FBI: Operator of Multi-Million-Dollar Ponzi Scheme Sentenced to More Than Nine Years in Prison on Securities Fraud Charges

Read Time3 Minute, 15 Second
.S. Attorney’s OfficeOctober 28, 2015
  • Western District of North Carolina(704) 344-6222

CHARLOTTE, NC—Daniel H. Williford, 57, of Fleetwood, N.C. was sentenced on Tuesday, October 27, 2015 to 110 months in prison for operating a Ponzi scheme that defrauded nearly 100 investors, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. In addition to the prison term, U.S. District Judge Max O. Cogburn, Jr. ordered Williford to serve three years of supervised release and to pay $17,915,013.35 as restitution.

U.S. Attorney Rose is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI) in North Carolina.

According to filed court documents and statements made in court, from January 2007 through July 2013, Williford operated a fraudulent investment scheme, through which he obtained more than $44 million from over 200 investors in Charlotte and elsewhere, causing nearly $18 million in losses to more than 100 investors by the time the scheme collapsed. Court records show that Williford lied to his victims, promising their money would be invested in wireless Internet equipment, Internet towers, and other facilities and companies. According to court records, rather than investing the victims’ money as promised, Williford used the majority of the funds to run a Ponzi-style scheme and used a portion to fund his personal lifestyle. Court records show that over course of the fraud, Williford invested only $7.7 million of the victims’ money and used approximately $32 million to pay some of his victims’ supposed “profits” on their investments and to cover personal expenses.

Court records also show that even after Williford ceased having any legitimate business operations, he continued to solicit money from investors for several years. One victim told the court yesterday evening that he was Williford’s co-pilot in a commercial airliner, and that Williford had literally defrauded him on the runway before takeoff. Other victims spoke about being unable to retire, declaring bankruptcy, losing children’s college savings, and one victim told the court he would have to sell his businesses, jeopardizing the jobs of over 50 employees as a result of the fraud. Williford pleaded guilty to securities fraud in July 2014.

Judge Cogburn said that Williford’s lengthy sentence was intended to “frighten those who will think about doing this, to make them think twice about stealing other people’s money” and to make such people realize “that going to prison for that long is not worth it.” Judge Cogburn also noted that the victims “will suffer a long time,” and pointed to the “callousness and huge period of time in which [Williford] took these people’s money” as a basis for the sentence.

The FBI investigated the case. Assistant U.S. Attorney Dan Ryan of the U.S. Attorney’s Office in Charlotte prosecuted the case.

The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.”

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Source: FBI
Robert Williams
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Robert Williams

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