GRIMY NEWS UPDATE: In a stunning twist of financial chicanery, Joshua Allen and Michael Cox from Lubbock, Texas, have been slapped with federal fraud charges for their alleged role in a Ponzi scheme that bilked hundreds of victims out of millions. The duo is joined by Brooklynn Chandler Willy of San Antonio, who was arrested separately on obstruction and fraud charges.
The indictments, unsealed on July 2, accuse Allen and Cox of jointly owning and controlling four investment firms: Ferrum Capital LLC, Ferrum II LLC, Ferrum III LLC, and Ferrum IV LLC. According to the charges, they along with Willy and others lured unsuspecting victims into investing in these entities under the guise of asset management and financial planning services.
The defendants are accused of misleading investors about the security of their investments while pocketing high commissions and lying about the nature of the investments. The scheme’s unraveling resulted in a catastrophic loss for hundreds, with much of the stolen money funneled to earlier victim-investors and benefiting the conspirators themselves.
Allen and Cox face up to 70 years behind bars if convicted on all charges, including conspiracy to commit wire fraud, money laundering, and securities fraud. They made their initial court appearance before U.S. Magistrate Judge Henry Bemporad today.
U.S. Attorney Justin R. Simmons for the Western District of Texas announced the charges, while the FBI and IRS-CI are investigating the case. Assistant U.S. Attorneys Joe Blackwell and Kelly Stephenson will lead the prosecution. The defendants remain innocent until proven guilty in a court of law.
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Key Facts
- State: Texas
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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