On Friday, it was announced that a Charlotte, North Carolina investment fund operator had pleaded guilty to one count of securities fraud and one count of tax evasion. 41-year-old Richard Wyatt David Jr. pleaded guilty before United States Magistrate Judge David S. Cayer. Documents in the case show that from 2010 to February of 2015, the defendant defrauded roughly 75 victims of $9.3 million by encouraging them to invest in investments funds and other investments.
The defendant recruited victim investors by making a series of false and fraudulently representations about how their money would be invested. Some investors were told that David would use their funds to invest in natural resources and assets, such as real estate and gold mines. The defendant also touted the investments as a safe alternative to the stock material.
In actuality, Davis used the investor funds to pay administrative and overhead expenses, as well as to repay other investors. David also used some of the money to make direct and indirect payments to himself. Despite lacking sufficient financial information to make such claims, Davis assured victims that their assets were growing. The plea hearing and court documents show that Davis primarily targeted victims residing in and around Charlotte. His clients included professional athletes and church members.
Davis also gave speeches at events for “preppers” and survivalists. During these events, the defendant preyed on individuals that were fearful of the stock market and banking system. Some of the victims rolled over their entire retirement savings account into Davis’s funds. Davis has been released on bond. At the time of sentencing, he will face a maximum term of 20 years for securities fraud and 5 years for tax evasion. A date for the sentencing has not yet been set.
Additional details about the charges can be found here.