Billings Chapman, Investment Fraud, Missouri 2014

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Columbia Man Sentenced for $1.1 Million Investment Fraud Scheme

A Columbia, Mo., man was sentenced in federal court today for a $1.1 million investment fraud scheme. Billings Chapman, 79, was sentenced by U.S. District Judge Stephen R. Bough to one year and six months in federal prison without parole. The court also ordered Chapman to pay $1,123,814 in restitution to his victims.

Chapman, a partial owner of CheckmarcUSA, LLC, a company formed to provide bad check collection services to banks, used his business, Federal Financial Services, LLC (FFS), to solicit investors. He admitted to engaging in a scheme from May 26, 2011, to April 30, 2014, to defraud investors by making materially false representations and using investment funds for his own personal benefit.

Chapman guaranteed monthly payments to investors and misrepresented to investors his financial condition and the financial condition of FFS. He falsely claimed that large numbers of banks had signed up for CheckmarcUSA’s services and that FFS was accruing substantial income as a result. Chapman did not tell investors that he had been barred from engaging in the securities industry in 1970 by the National Association of Securities Dealers, or that he had been issued cease and desist orders in 1991 and in 2004 from the Missouri Commissioner of Securities for engaging in fraudulent or illegal practices in the securities business.

Chapman, who was not registered to sell securities in Missouri, used investor money for his own personal gain and to make payments to prior investors. According to court documents, the loss to Chapman’s victims totaled $1,123,814. A number of the victims were devastated financially by their loss. For example, one victim lost all of his retirement savings and had to suspend his retirement and resume working. Another victim, a single mother of two, invested her entire savings with Chapman and FFS, and her loss caused her to be unable to pay her bills.

Assistant U.S. Attorney Jim Lynn prosecuted the case, while the FBI investigated. The case highlights the importance of doing thorough research before investing in any business or scheme, and the severe consequences of falling victim to a financial scam.

Chapman’s actions have left a trail of financial devastation in his wake, and his sentence serves as a reminder of the seriousness of investment fraud. The Grimy Times will continue to follow this case and provide updates as more information becomes available.

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