Audio By Carbonatix
This just in from the U.S. Attorney’s Office: A 29-year-old man from Plano, Edward Louis Molz III, pleaded guilty in Dallas federal court this morning to a single count of wire fraud, for which he faces up 20 years in prison and a $250,000 fine. On top of that, he could have to pay back the more than 200 people he swindled in an elaborate scheme detailed in the release — one that involved a phony name, a fake LLC, counterfeit docs and the promise of credit extended to small businesses in desperate need of “alternative financing.”
The whole sordid tale follows, but very long story short: Molz — using the name Frank Sullivan — promised these business owners that for a small fee (say, $3,250), they could buy a so-called “aged” corporation that had a line of credit worth at least $150,000, which they were then free to spend just nine to 12 weeks after he got their money. Except it didn’t quite work that way: Molz admitted to phonying up docs, then taking 247 individuals’ checks and wire transfers and depositing the pile into his personal bank accounts, which he then used to buy a 2007 BMW 650, a
2005 Maserati and property on Cartwright Street in Irving.
DALLAS AREA MAN PLEADS GUILTY TO WIRE FRAUD IN CONNECTION
WITH FRAUDULENT ADVANCE FEE SCHEME HE RAN
Defendant Faces Up to 20 Years in Federal Prison
DALLAS – Edward Louis Molz, III, aka “Frank Sullivan,” 29,
of Plano, Texas, pleaded guilty this morning before U.S. Magistrate
Judge Paul D. Stickney to one count of wire fraud in connection with a
fraudulent advance fee scheme he ran, announced U.S. Attorney James T.
Jacks of the Northern District of Texas. Molz faces a maximum statutory
sentence of 20 years in prison, a $250,000 fine and restitution.
Sentencing is set for April 18, 2011, before U.S. District Judge Sam A.
Lindsay.Molz was arrested in September 2010 at his home by FBI
agents on wire fraud and mail fraud charges outlined in a federal
criminal complaint, and was released on a personal recognizance bond. A
federal grand jury returned a six-count indictment the following month
charging Molz with four counts of wire fraud and two counts of mail
fraud.According to the factual resume filed in the case, from
November 2009 through May 2010, Molz ran a scheme in which he induced
small business owners, who were seeking alternative means of financing,
to pay a fee to purchase an “aged” corporations. These “aged”
corporations purportedly had access to lines of credit that were
available to the purchaser.To carry out his scheme, Molz established 3rd Street
Financial, LLC, and, using the assumed name of “Frank Sullivan,” held
himself out as its chief financial officer. He marketed 3rd Street
Financial through a website and a loose association of financial
brokers. He represented to potential purchasers that he had established
and maintained a number of “aged” corporations which had been in
existence for four to five years and had access to lines of credit
between $250,000 and $400,000. For a $3250 acquisition fee, a purchaser
could acquire a “Tier 1” corporation with a minimum line of credit of
$150,000. However, for a $6500 acquisition fee, a purchaser could
acquire a “Tier 2” corporation with a $250,000 minimum line of credit.Molz represented that upon payment of the fees, he could
deliver the aged corporation to a purchaser within nine to 12 weeks. He
also represented that each “aged” corporation had additional benefits,
including established “business trade lines,” a complete financial and
business plan, a Dun & Bradstreet listing and three years of valid tax
returns. He furnished potential purchasers with false and fictitious
documents, including service agreements, testimonials from satisfied
purchasers and letters from financial institutions confirming the
issuance of lines of credit.During the time frame mentioned above, approximately 247
individuals mailed or wired money to Molz and he deposited those funds
into JPMorgan Chase and Compass Bank accounts. Molz did not deliver any
“aged” corporations as promised. Instead, he used the money almost
exclusively for his personal benefit, including the acquisition of
personal assets and real estate.According to the plea agreement, Molz has agreed to forfeit
property that was derived from proceeds traceable to his offense,
including the funds seized on September 7, 2010, from the 3rd Street
Financial LLC account at JPMorgan Chase, as well as a 2007 BMW 650, a
2005 Maserati and real estate located on Cartwright Street in Irving,
Texas.This law enforcement action is part of President Barack
Obama’s Financial Fraud Enforcement Task Force. President Obama
established the interagency Financial Fraud Enforcement Task Force 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.The FBI is in charge of the investigation; Assistant U.S.
Attorney Christopher Stokes is in charge of the prosecution.
