Is it something in the water?
A federal jury in St. Paul is weighing whether Wayzata businessman Tom Petters orchestrated one of the largest Ponzi schemes in U.S. history. Federal regulators are suing Twin Cities money managers for allegedly running a Ponzi scheme that bilked more than 1,000 mom-and-pop investors out of their life savings.
And now, a former Hopkins resident faces federal charges that he ran a decade-long Ponzi scheme that sacked investors in a purported "high-yield" multi-state investment program.
A federal grand jury in Minneapolis last month handed up an indictment against Mark S. Sutton, charging him and Colorado resident Joseph L. Finney with conspiracy to commit mail fraud and wire fraud and money laundering conspiracy. And Sutton faces an additional charge of conspiracy to defraud the United States with a tax evasion scheme.
According to the indictment, the men first offered what they said were high-yield investments in 1999, promising high profits and the guarantees of government agencies, as long as investors made large investments and kept them secret from others.
Some of the money was used to repay investors to keep alive the illusion that the men were generating and sharing profits, but other monies were simply shared among Sutton, Finney and perhaps others, the indictment says.
The pair used a variety of corporations, an entity and a limited liability partnership to transfer and conceal the money, including Midwest Consultants, Passion Ministries, Tabletalk Research Inc., Envestclub, Providence Consortium, Admiral Aviation Ltd. and Berbrook, Ltd.
The tax fraud conspiracy allegedly involved Sutton establishing a trust and using a corporate name to help an unnamed individual to conceal money from the Internal Revenue Service. The indictment also mentions e-mails from 2004 in which Sutton appears to help someone file frivolous tax returns.
U.S. Attorney B. Todd Jones said in court documents that Sutton's case is related to charges filed two years ago against John A. Higginbotham, 61, of Plymouth, who pleaded guilty in 2007 to two counts of income tax evasion for attempting to conceal $182,960 in 1991.
Matt McKinney 612-673-7329