Two Colorado financial services executives have been sentenced for their role in a multimillion-dollar investment scheme.
A former CEO and a former corporate counsel of a Colorado financial services company, Compass Financial Solutions Ltd. (CFS), were sentenced on June 19 and June 20, in Denver, Colorado, for their participation in a multimillion-dollar investment scheme.
The scheme involved falsely telling investors that they could access substantial financing, including hundreds of millions in cash in an overseas bank account, in exchange for up-front fees.
Brian G. Elrod, 59, of Buffalo Creek, Colorado, formerly the CEO of CFS, was sentenced to serve 38 months in prison, followed by three years of supervised release. Additionally, Elrod was ordered to pay restitution in the amount of $2,440,051.29.
William E. Dawn, 80, who was CFS’s corporate counsel, was sentenced to time served. U.S. District Judge William J. Martinez handed down the sentence for Elrod, and U.S. District Judge Robert E. Blackburn sentenced Dawn and ordered him to pay restitution in the amount of $366,752.01.
Elrod pleaded guilty on February 19, 2015, in the District of Colorado to one count of conspiracy to commit mail fraud and wire fraud. As part of his plea agreement, Elrod admitted that from approximately 2005 to 2011, while he served as the CEO of CFS, he marketed and sold to investors promissory notes that were purportedly guaranteed by CFS and others.
Elrod used the investors’ funds for, among other things, payments to other investors and to himself. After Elrod defaulted on the notes, he conspired with Kenneth Brewington, who purported to be a wealthy financier, and told investors that Brewington would assume CFS’s obligations on these notes.
To induce CFS’s investors to sign these assumption agreements, Elrod showed investors fraudulent documents that falsely claimed Brewington had 500 million euros in an overseas bank account. Elrod also sold additional promissory notes that were guaranteed by Brewington personally.
Key Facts
- State: Colorado
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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