Douglas Hawkins, a Lexington investment advisor and attorney from Richmond, Ky., has been found guilty of investment advisor fraud, securities fraud, and two counts of mail fraud by a federal jury in Lexington.
According to the evidence presented at trial, Hawkins encouraged his clients to invest in properties located in Jackson, Mississippi, resulting in over $2 million in investments. However, Hawkins withheld crucial information about the properties, including their uninhabitable condition, burdensome rent collection, and frequent theft and vandalism.
Hawkins also failed to disclose to his clients that their investment funds would be used for purposes other than the properties, such as paying other investors and purchasing a Harley Davidson for an employee. This egregious breach of trust has led to severe consequences for the defendant.
The investigation, conducted by the United States Postal Inspection Service and the Kentucky Department of Financial Institutions, revealed the extent of Hawkins’ fraudulent activities. The United States was represented in the case by Assistant U.S. Attorneys Andrea Mattingly-Williams and Will Moynahan.
Carlton S. Shier, IV, United States Attorney for the Eastern District of Kentucky; Kyle Erhardt, Special Agent in Charge, United States Postal Inspection Service; and Justin Malcom Burse, Acting Commissioner, Kentucky Department of Financial Institutions, jointly announced the guilty verdict. Hawkins was indicted in October 2021 and is scheduled to appear for sentencing on April 24, 2023.
Hawkins faces significant penalties, including up to five years in prison on the investment advisor count, up to 20 years in prison on the securities fraud count, and up to 20 years in prison on each count of mail fraud. Additionally, he may be subject to fines and a judgment of restitution, as ordered by the Court. The U.S. Sentencing Guidelines and applicable federal sentencing statutes will be considered before imposing a sentence.
RELATED: Lexington Advisor Hawkins Found Guilty of Investment Fraud
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Key Facts
- State: Kentucky
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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