Audio By Carbonatix
So says a press release from the U.S. Attorney’s Office that just landed in the in-box. His name is Brion Gary Randall, and according to the feds, on May 18 the 48-year-old will plead guilty in Dallas federal court to running a handful of scams between 2004 and last July that were eventually unearthed by the Financial
Fraud Enforcement Task Force. The release details the myriad dirty deeds that could land Randall in prison for the rest of life, but one in particular leaps out:
Randall said he owned something called Titan Home Theater, and he asked investors if maybe they wanted to loan him some dough to finish some big projects. Said he’s pay ’em off handsomely once the jobs were done — the original loan plus an additional 22 percent on top, ka-ching. And they believed him. Why? Because, according to the U.S. Attorney’s Office, “Randall falsely represented that Titan was a subcontractor on several commercial projects including projects at Southern Methodist University, the Bush Library and the Dallas Cowboys stadium.” People.
ORMER INVESTMENT ADVISOR TO PLEAD GUILTY
IN INVESTMENT FRAUD CASE
Brion Gary Randall Defrauded 30 Local Investors and
Caused More than $6 Million in Losses
DALLAS – A Plano, Texas, man, who has admitted running a
fraudulent investment scheme from 2004 through July 2009, will enter his
guilty plea before U.S. Magistrate Judge Paul D. Stickney on May 18,
2010, to felony offenses related to that crime, announced U.S. Attorney
James T. Jacks of the Northern District of Texas. Brion Gary Randall,
48, has signed documents, filed with the Court, pleading guilty to an
Information charging one count of mail fraud and one count of bank
fraud. Each count carries a maximum statutory sentence of 30 years in
prison and a $1 million fine.According to filed plea documents, Randall worked as an
investment advisor from 2004 through July 2009. During part of that
time, he operated, and owned in part, 2Randall Consulting Group, LLP and
also owned part of Titan Home Theater, LLC, which designed and installed
commercial and residential audio/visual systems. According to a
complaint filed by the U.S. Securities and Exchange Commission against
Randall and 2Randall in August 2009, the Financial Industry Regulatory
Authority (FINRA) suspended and fined Randall for improperly exercising
discretion in customer accounts without prior written permission. That
case is currently pending.From 2004 through July 2009, Randall raised more than $6
million from 30 investors through a scheme in which he caused persons to
invest in a number of short-term loan participation programs, which in
fact, did not exist. He used investors’ funds for his own benefit and
not for purposes he represented.For example, Randall represented that he was pooling money
in accounts at Chase Bank and AllianceBernstein for investment in a
variety of short-term loan participation programs. Randall represented
that an investor’s money in 2Randall Consulting’s account at Alliance
and Chase was held in a non-taxable escrow account and fully liquid,
with the investor able to withdraw his money at any time. He
represented that the 2Randall consulting account at AllianceBernstein
had a balance ranging from $25 million to $29 million, and that he had
also invested millions of dollars of his own money into the accounts.In reality, however, the Chase Bank and AllianceBernstein
accounts were nonexistent. To further the scheme, Randall created and
distributed fraudulent documents to investors, including bogus Chase
Bank and AllianceBernstein account statements. He also created bogus
2Randall Consulting accounting statements and portfolio summaries. In
meetings with some investors, he would display a false and fictitious
computer screen shot of either the Chase Bank or AllianceBernstein
account which would show the investor’s money on deposit.Randall also represented to investors that they could invest
in short-term loan participations, usually lasting 45 to 90 days and
returning a high rate of interest. He sold loan participation programs
in 1) Small Business Administration (SBA) loans; 2) Titan Home Theater
project completion loans; and 3) loans to acquire real estate in
Galveston, Texas.For the SBA loans, Randall falsely represented to investors
that they could participate with 2Randall Consulting in a short-term
loan to a local company seeking an SBA loan. Randall represented that
the short-term loan would provide sufficient capital to enable the
company to obtain the loan at a discounted rate, and once the SBA loan
closed, the company would return to 2Randall Consulting and the
participating investors the principal plus 10 percent. He represented
that the companies receiving the loans were reputable local businesses,
including 84 Lumber, General Packaging Corporation, PerotSystems
Vent-A-Hood and Richardson Bike Mart, businesses where Randall’s father
had an established relationship. Randall represented that participating
in an SBA loan participation program was low risk and that an investor
could only lose his money if the company declared bankruptcy during the
45-90 day term of the loan. Randall knew that no such SBA loan
participation agreements existed.With regard to the Titan Home Theater project completion
loans, Randall represented that investors could participate in
short-term loans to Titan enabling it to complete a number of commercial
projects, and that upon completion of the projects, Titan would return
the principal plus up to a 22% return. Randall falsely represented that
Titan was a subcontractor on several commercial projects including
projects at Southern Methodist University, the Bush Library and the
Dallas Cowboys stadium.Randall also represented to investors that they could
participate in short-term loans enabling him to finalize the acquisition
and sale of real estate in Galveston. Randall promised that on closing,
he would return the investor’s principal plus a sizeable rate of
interest.As a further part of his fraud, Randall obtained loans from
financial institutions by submitting forged signatures and false and
fraudulent documents. The plea documents note that Randall obtained
five loans, from Bank of America, Texas Capital Bank and Wells Fargo,
that all defaulted, causing a total loss to these financial institutions
of nearly $875,000.This case is part of President Barack Obama’s Financial
Fraud Enforcement Task Force (FFETF). President Obama established the
interagency FFETF to wage an aggressive, coordinated and proactive
effort to investigate and prosecute financial crimes. The task force
includes representatives from a broad range of federal agencies,
regulatory authorities, inspectors general, and state and local law
enforcement who, working together, bring to bear a powerful array of
criminal and civil enforcement resources. The task force is working to
improve efforts across the federal executive branch, and with state and
local partners, to investigate and prosecute significant financial
crimes, ensure just and effective punishment for those who perpetrate
financial crimes, combat discrimination in the lending and financial
markets and recover proceeds for victims of financial crimes.
