Opinion ID: 3045262
Heading Depth: 3
Heading Rank: 1

Heading: Defendants’ High Yield Investment Scheme

Text: Edwards found potential victims through investment conferences or by referrals from other victim-investors. Edwards utilized a variety of misrepresentations to encourage potential victims to invest in his scheme. He 1 Frontier Holdings Inc. is a Georgia corporation. Edwards is the CEO of Frontier Holdings and controls its decisions and operations. Edwards offered his high yield investment scheme through Frontier Holdings and used several bank accounts belonging to Frontier Holdings. While Frontier Holdings was not ordered to pay restitution, the defense makes no differentiation between the two defendants and both defendants challenge on appeal all issues. 2 Case: 11-15953 Date Filed: 09/06/2013 Page: 3 of 23 promised victims that the high yield program produced returns ranging from 75% to 800%. He also lied about his background. He told one victim that he owned five banks. Another was told that he owned the First National Bank of Georgia. A number of victims were told that he owned large tracts of land in Georgia and handled millions of dollars in investment funds. At other times, Edwards told victims that he was an agent of the Federal Reserve and a friend of then-VicePresident Dick Cheney. Edwards did not explain how the high yield investment program worked, but told victims that this was a special investment opportunity reserved for high net worth individuals. Despite these restrictions, Edwards assured victims that he could allow multiple small investors to pool their money and access these investments through his banking connections. At times, Edwards represented that the investment worked by depositing money into special high interest Federal Reserve accounts. At other times, Edwards asserted that the investment capitalized on “fads” at the International Monetary Fund. Despite the high returns, Edwards told victims that the high yield program was completely risk-free. According to Edwards, the money was only pledged; so, the victims’ money would never leave the bank he owned. These misrepresentations enticed victims to send the Defendants money. Victims were normally asked to wire money directly to the Defendants’ accounts. 3 Case: 11-15953 Date Filed: 09/06/2013 Page: 4 of 23 After receiving the victims’ money, Edwards did not invest it as promised. Rather, he used the money for extravagant personal expenditures including houses, cars, and cruises. Whenever victims attempted to withdraw money, Edwards assured them that the investment was producing returns, but provided excuses for why the money was not immediately available. Eventually, Edwards stopped communicating with the victims. The Defendants were indicted by a federal grand jury on six counts of mail fraud (counts 1-6), twenty counts of wire fraud (counts 7-26), and eleven counts of money laundering (counts 27-37). (Dkt. 127.) After the close of evidence at trial, the district court granted the Government’s motion to dismiss counts 3, 4, and 5, and the Defendants’ motion to dismiss counts 1, 12, 18, and 25. (Dkt. 239 at 1.) The court denied the Defendants’ motion to dismiss counts 2, 6, 7-11, 14-17, 19, 21-24, and 26. The jury convicted the Defendants on two counts of mail fraud (counts 2 and 6), seventeen counts of wire fraud (counts 7–11, 13–17, 19–24, and 26), and eleven counts of money laundering based on a high yield investment scheme (counts 27–37). (Dkt. 242, 243.)