Georgia Man and Woman Indicted for Defrauding Investors

GEOFFREY A. GISH, 56, of Marietta, Georgia, was arraigned yesterday before United States Magistrate Judge Janet King on charges that he and another individual operated a Ponzi scheme. A federal grand jury returned an indictment on August 24, 2010, charging GISH and MYRA J. ETTENBOROUGH, 55, of Roswell, GA, with conspiracy and mail and wire fraud arising out of their operation of GISH’s business, Weston Rutledge Financial Services, Inc. (“Weston Rutledge”), which was located in Marietta and, later, Roswell, Georgia. ETTENBOROUGH appeared for her initial appearance on the indictment on Friday.

United States Attorney Sally Quillian Yates said, “Investors lost millions of dollars that they were told was successfully invested and was generating earnings on their investment. Instead, Mr. Gish and Ms. Ettenborough allegedly made false promises and diverted the money to other uses, including their own personal benefit.”

Brian D. Lamkin, Special Agent in Charge, FBI Atlanta Field Office, stated: “The loss amounts sustained by the many victims in this investment fraud scheme represent the greed of those responsible. While it is hard to avoid becoming a victim of these aggressive and well constructed schemes when the facts and figures being provided are blatantly falsified, people should always be extremely cautious of promises of high rates of returns.”

According to United States Attorney Yates, the indictment and other information presented in court: Beginning in 2005 and continuing to May 17, 2006, GISH and ETTENBOROUGH conspired to defraud and defrauded investment clients of Weston Rutledge by fraudulently misrepresenting the ways in which they used their clients’ money and the purported earnings that the clients’ investments generated. On May 17, 2006, a federal judge froze Weston Rutledge’s assets and appointed a receiver to take over Weston Rutledge and find any and all assets derived from the alleged fraud for return to investors. Despite having received almost $29 million in investments from its clients, Weston Rutledge’s bank accounts had only approximately $1 million of the money raised from investors left when it was placed into receivership. The indictment alleges that GISH and ETTENBOROUGH used the invested funds for a variety of purposes that were different than the purposes and uses represented to investors. None of these uses returned any principal, earnings, or profits to Weston Rutledge that were consistent with or that supported the representations that GISH and ETTENBOROUGH made to investors about the earnings and profits generated with their funds.

The indictment alleges that GISH operated, controlled, and was the primary salesperson for Weston Rutledge, which was headquartered in Marietta, Georgia until August 2005, and thereafter at an office in Roswell, Georgia. GISH also established an office for Weston Rutledge in Denton, Texas. ETTENBOROUGH was Weston Rutledge’s Office Manager, responsible for managing its day-to-day operations, answering questions from investors about their accounts at Weston Rutledge, and maintaining Weston Rutledge’s various bank accounts, including the bank accounts established to receive and disburse investment funds raised from investors.

The indictment alleges that Weston Rutledge’s investment offerings included three pooled investment funds or entities named or referred to as “Zamindari Capital,” the “Lexington International Fund,” (the “Lexington Fund”) and “Oxford Adams.” Zamindari Capital purportedly was involved in bond or note trading “projects” or “programs” that varied in length. The Lexington Fund purportedly was involved in currency trading. Oxford Adams purportedly was involved in index or options investing.

The indictment alleges that to obtain investments, GISH made false representations to investors and potential investors about the uses, security, and profits and earnings of investments in Zamindari Capital and the Lexington Fund. When meeting with investors and potential investors, GISH falsely represented that funds invested in Zamindari Capital would be held in a bank account that was blocked, would not be touched, and not depleted during the course of the investment. GISH falsely represented that money invested in the Lexington Fund would be used for currency trading. GISH falsely promised that Zamindari Capital produced gains of 10-15 percent per month and that Lexington produced gains of 4-8 percent per month depending on the amount invested. GISH provided investors and caused investors to be provided with written materials repeating and confirming these false promises and representations.

The indictment alleges that ETTENBOROUGH, as Weston Rutledge's Office Manager, falsely portrayed to investors that Zamindari Capital and the Lexington Fund were successful investments that generated the returns and “earnings” that GISH promised and caused to be promised. GISH and ETTENBOROUGH sent investors monthly statements that falsely reflected earnings on and the growth of their funds invested in Zamindari Capital and the Lexington Fund. These statements showed increases in investors’ total account balances as a result of purported earnings or gains from the supposed investments.

The indictment alleges that GISH and ETTENBOROUGH used the money invested in Zamindari Capital and the Lexington Fund for a variety of uses and purposes that were different than those represented to investors. These uses and purposes included payments to investors who requested withdrawals or distributions of principal and earnings from their Zamindari Capital, Lexington Fund, and Oxford Adams investments; transfers to third parties purportedly for or in connection with investments or, in certain cases, as loans; payments and transfers to GISH and for his personal benefit; payment of Weston Rutledge’s operating expenses, including ETTENBOROUGH’s salary, other employee salaries, office rent, and travel expenses; payment of commissions to the sales representative working out of the Denton, Texas, office; payments to investors for referring new investors; and transfers to other Weston Rutledge bank accounts that GISH and ETTENBOROUGH established that were not related to Zamindari Capital or the Lexington Fund.

The indictment alleges that Weston Rutledge, Zamindari Capital, and the Lexington Fund did not receive significant and meaningful funds, earnings, and gains back from and as a result of GISH and ETTENBOROUGH's uses of investor money. GISH and ETTENBOROUGH's representations about Zamindari Capital and Lexington Fund earnings and gains, including the account statements that they sent and caused to be sent to investors, were not supported by and consistent with any earnings and gains returned or received from the supposed investments and loans made with investor funds. GISH and ETTENBOROUGH allegedly concealed and failed to disclose these material facts to investors.

The indictment alleges that in December 2005, and until it was placed into receivership on May 17, 2006, Weston Rutledge did not have sufficient funds on hand to satisfy all investor requests for withdrawals of principal and earnings. To help fund requested withdrawals, GISH and ETTENBOROUGH attempted to retrieve some of the money they had sent to a third party as a purported investment or loan. GISH and ETTENBOROUGH were unsuccessful and received no money back. GISH and ETTENBOROUGH delayed paying certain withdrawal requests until they could fund requested withdrawals with money from other investors.

The indictment charges one conspiracy count and 10 counts of mail and wire fraud. The conspiracy charge carries a maximum possible sentence of up to five years and a fine of up to $250,000. Each of the mail and wire fraud charges carry a maximum possible sentence of up to 20 years in prison and a possible fine of up to $250,000. In determining the actual sentence, the court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.

Members of the public are reminded that the indictment only contains charges. The defendant is presumed innocent of the charges and it will be the government's burden to prove the defendant's guilt beyond a reasonable doubt at trial.

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As Hurricane Earl Approaches, FEMA Urges East Coast Residents to be Prepared

Families Should Visit Ready.gov to Learn Steps to Prepare for Hurricanes and Severe Weather

As Hurricane Earl moves toward Puerto Rico and the U.S. Virgin Islands and then up toward the East Coast of the United States, the Federal Emergency Management Agency (FEMA) is urging all Americans in East Coast states to take steps now to prepare their families and businesses for hurricanes and severe weather. While there are currently no hurricane warnings or watches in effect for the U.S. mainland, current projections from the National Hurricane Center show the storm could affect states up and down the East Coast and storm tracks can change quickly and unexpectedly. With this in mind, FEMA is coordinating through its regional offices to aggressively prepare should severe weather affect the East Coast and encouraging all Americans to visit www.ready.gov for helpful tips on preparing for hurricanes, flash flooding, and other disasters.

"Hurricane Earl should serve as a reminder to all of us of the importance of being prepared for hurricanes and other emergencies," said FEMA Administrator Craig Fugate. "At FEMA, we're taking steps to aggressively prepare should a hurricane make landfall along the East Coast, but FEMA is only one part of the team. Even if this storm doesn't make landfall, everyone should visit Ready.gov now and learn how to make your family safer and better prepared."

Steps individuals and families should take to prepare for an emergency include developing a family communications plan, putting together a kit with 72 hours of food and water, and staying informed of risks in their area.

It's also important to remember that hurricanes frequently bring with them heavy rains and the threat of flash flooding, which can occur hundreds of miles inland from the coast. People along the coast should also be aware of dangerous rip tides and surf. Floods are the costliest natural disaster in the United States, and so valuables and important documents should be copied and kept in a safe place.

Hurricane Earl has been categorized by the National Hurricane Center as a Category 4 hurricane. A hurricane warning has been issued for the U.S. Virgin Islands, and a watch has been issued for Puerto Rico. FEMA is coordinating across the federal government and working with commonwealth and territorial officials in the Virgin Islands and Puerto Rico to support their preparedness and response efforts on the ground. Learn more about those efforts.

FEMA personnel are also monitoring the storm and reaching out to Governors and local officials up and down the East Coast to ensure they are prepared should they be affected by severe weather in the coming days. FEMA has life-saving and life-sustaining commodities and supplies strategically located across the country to support states in their response, including in the areas of possible impact. These supplies, including water, meals, tarps, blankets, generators and other essential items, can be replenished through the national logistics supply chain.

Since this weekend, FEMA has been in constant contact with the White House and Department of Homeland Security (DHS) to provide regular updates on the storm's developments. Today Administrator Fugate briefed DHS Secretary Janet Napolitano about FEMA's ongoing preparations for and response to severe weather in the Atlantic Ocean, including Hurricane Earl.

The National Weather Service remains the source of official severe weather watches and warnings, including flash flooding which can take only a few minutes to develop in the case of heavy rains.

FEMA encourages all individuals in the region to listen to NOAA Weather Radio and their local news to monitor for severe weather updates, and to follow the directions provided by their local officials especially concerning any potential evacuations.

4.4 Percent of Prison Inmates and 3.1 Percent of Jail Inmates Reported One or More Incidents of Sexual Victimization During 2008-2009

/PRNewswire/ -- An estimated 88,500 inmates--64,500 in prison and 24,000 in jails--reported experiencing one or more incidents of sexual victimization by another inmate or facility staff during 2008-09, the Justice Department's Bureau of Justice Statistics (BJS) in the Office of Justice Programs announced today. The findings are based on a survey of prison and jail inmates about incidents occurring in the last 12 months or since their admission to the facility, if less than 12 months.

To meet requirements of the Prison Rape Elimination Act of 2003, BJS surveyed more than 81,500 inmates held in 167 state and federal prisons, 286 jails, and 10 special confinement facilities between October 2008 and December 2009. About 4.4 percent of prison inmates and 3.1 percent of jail inmates reported sexual victimization by another inmate or facility staff. Nationwide, 2.1 percent of all prison inmates and 1.5 percent of all jail inmates reported at least one incident involving another inmate; 2.8 percent of prison inmates and 2.0 percent of jail inmates reported having had sex or sexual contact with facility staff.

Among the 463 facilities in the survey, eight male prisons, two female prisons, and six jails were identified as "high rate" facilities based on the prevalence of inmate-on-inmate sexual victimization. Four male prisons, two female prisons, and five jails were identified as "high rate" based on the prevalence rate of staff sexual misconduct.

Among all prison inmates, the reported use or threat of physical force to engage in sexual activity was generally low. An estimated 1.3 percent of prison inmates reported the use or threat of force during inmate-on-inmate victimization and 1.0 percent during staff sexual misconduct. Among all jail inmates,

1.0 percent reported the use or threat of force during inmate-on-inmate victimization and staff sexual misconduct.

Female prisoners (4.7 percent) were more than twice as likely as male prisoners (1.9 percent) to report experiencing sexual victimization by another prisoner. Jail inmates reported a similar pattern of inmate- on-inmate sexual victimization (3.1 percent for females compared to 1.3 percent for males).

Sexual activity with staff was somewhat more prevalent among incarcerated males. An estimated 2.9 percent of male prisoners and 2.1 percent of male jail inmates reported at least one incident with staff, compared to 2.1 percent of female prisoners and 1.5 percent of female jail inmates.

Among male inmates who reported staff sexual misconduct in prison and jail, about two-thirds reported sexual activity with female staff.

White or multi-racial inmates reported higher rates of inmate-on-inmate sexual victimization in prisons and jails than black inmates. Higher rates were also reported among inmates who had a college degree or more compared to those who had not completed high school, who had a sexual orientation other than heterosexual compared to heterosexuals, and who had experienced a sexual victimization before coming to the facility compared to those who had not.

Rates of reported staff sexual misconduct were higher among black inmates compared to white inmates and higher for inmates ages 20 to 24 compared to those age 25 or older. Also, rates of staff sexual misconduct were higher among inmates with a college degree or more compared to those who had not completed high school, and among inmates who had experienced a sexual victimization before coming to the facility compared to those who had not.

About half of the inmates who reported inmate-on-inmate sexual victimizations reported at least one incident of nonconsensual sex, defined as unwanted oral, anal, or vaginal sex, or manual stimulation. Over half of the inmates who reported staff sexual misconduct said that the sexual contact or activity was willing.

Among victims of inmate-on-inmate sexual victimization, 37 percent of males in jail and 21 percent of males in prison reported being injured. Among females, eight percent in jail and 17 percent in prison reported being injured. For victims of staff sexual misconduct, 17 percent of males in jail and nine percent of males in prison reported they had been injured, compared to eight percent of females in jail and 19 percent of females in prison. The most common injuries were bruises, scratches and cuts.

The report, Sexual Victimization in Prisons and Jails Reported by Inmates, 2008-09 (NCJ 231169), was written by BJS statisticians Allen J. Beck and Paige M. Harrison and RTI International staff Marcus Berzofsky, Rachel Caspar, and Christopher Krebs. Following publication, the report can be found at http://bjs.ojp.usdoj.gov/.

Seeking Information on Three Robberies in the Atlanta Metro Area

Special Agent in Charge (SAC) Brian D. Lamkin, FBI Atlanta, requests the assistance of the public in identifying and locating the individuals believed to be responsible for at least three bank robberies in metro Atlanta, Georgia.

On Wednesday, August 25, 2010, at approximately 10:43 a.m., two black males entered the Wachovia Bank, located at 1280 Dogwood Drive, Conyers, Georgia, brandishing handguns and disguising themselves with black wigs while announcing a robbery. After obtaining an undisclosed amount of money, the robbers departed the bank without further incident.

These two robbers are also believed to be responsible for two additional armed robberies within the metro Atlanta area, the details of which are provided below:

On Monday, August 16, 2010, at approximately 10:30 a.m., two black males, armed with handguns, entered the Wachovia Bank located at 3374 Holcomb Bridge Road, Norcross, Georgia and proceeded to take over the banking center. Robber #1 vaulted over the teller counter, while Robber #2 remained in the lobby area, ordering other bank patrons to the ground at gunpoint. The armed robbers obtained an undisclosed amount of cash before fleeing the bank, possibly in a silver Lexus.

On Tuesday, July 27, 2010, at approximately 10:44 a.m., two black males, armed with handguns, entered the Wachovia Bank located at 2725 Clairmont Road, Atlanta, Georgia and announced a robbery. Robber #1 vaulted the teller counter, carrying a blue canvas bag and obtained an undisclosed amount of money from the teller stations. Robber #2, while brandishing a silver semi-automatic handgun, remained in the lobby of the bank and ordered customers to the ground. Both robbers departed the bank shortly thereafter without further incident.

The robbers are described as follows:

Robber #1 is described as a black male, 20-30 years in age, wearing a short black wig, glasses, and t-shirt.
Robber #2 is described as a black male, 20-25 years in age, wearing a shoulder length wig, black in color, shorts, work style boots, stocky build.

The robbers are believed to be traveling in a silver Lexus.

Both robbers brandished handguns throughout the robbery and should be considered armed and dangerous.

Anyone with information regarding this matter should contact the Atlanta office FBI at tel. (404) 679-9000 or Conyers PD at tel. (770) 929-4206.

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ATF Offers $5K Reward for Information on Retail Gun Theft

/PRNewswire/ -- The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Atlanta Field Division, today announced a reward of up to $5,000 for information leading to the arrest and convictions of those responsible for a recent firearms theft at Kemp's Pharmacy, a federal firearm licensee in Claxton, Ga. The incident has triggered a multi-jurisdictional investigation, being conducted by ATF, the Georgia Bureau of Investigation, the Evans County Sheriff's Office and the Claxton Police Department.

"Gun thieves play a critical and deadly role in the chain of violence, and ATF places a major emphasis on solving these crimes," said Special Agent in Charge Gregory Gant. "Investigative experience has shown that felons, gang members and juveniles are some of the most common customers for stolen guns in the underground economy of our streets. When guns fall into the wrong hands, the potential for violence increases. Solving this crime will be a team effort, among law enforcement and concerned members of the public."

The early morning burglary occurred on Saturday, June 12 at the business, located at 107 S. Duval St., Claxton, Ga. At approximately 12:50 a.m., the store's security system alerted owners and law enforcement to the burglary. The thieves made entry by smashing the front glass door of the business with a large, metal 55-gallon barrel. Once inside, they smashed two glass display cases and were able to steal a total of 26 handguns and an AK-47 style rifle. Security cameras from an adjacent business filmed two black male subjects fleeing on foot from Kemp's Pharmacy at the time of the theft.

Investigators are seeking the public's help with identifying the subjects involved and providing information on the location of any or all of the stolen firearms. Anyone with information is encouraged to call ATF's toll-free, 24-hour hotline at 1-888-ATF-TIPS (1-888-283-8477). Callers can remain anonymous.

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Georgia Man Convicted of Child Sex Abuse Offenses

Dwain D. Williams was convicted Thursday by a federal jury in Valdosta, Ga., on child sex abuse offenses, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and Acting U.S. Attorney G.F. Peterman III of the Middle District of Georgia.

Williams was convicted of one count of traveling in foreign commerce and engaging in illicit sexual conduct, one count of aggravated sexual abuse, and one count of abusive sexual contact of a child under 12 years of age. The aggravated sexual abuse and the abusive sexual contact charges were committed while Williams was accompanying a member of the Armed Forces outside of the United States in violation of the Military Extraterritorial Jurisdiction Act (MEJA). Williams faces a possible mandatory minimum sentence of 30 years in prison and a maximum sentence of life in prison for his conviction.

At trial, the female victim, currently 15 years old, testified that Williams had repeatedly raped her starting from when she was 9 years old until she was 13, when she lived in Okinawa, Japan.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

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Georgia Man Sentenced to 30 Years in Prison for Role in Drug Trafficking Conspiracy

MARLON BURTON, 38, of McDonough, Georgia, was sentenced today by United States District Judge Thomas W. Thrash to serve 30 years in federal prison on charges of conspiring to distribute drugs.

United States Attorney Sally Quillian Yates said, “Mr. Burton ran a sophisticated drug-trafficking organization for over 10 years while appearing to operate a legitimate contracting business in Atlanta. In reality, he was purchasing hundreds of kilograms of cocaine and other drugs from a Mexican drug cartel and then distributing the drugs to a variety of street-level dealers working for his organization.”

Atlanta FBI Special Agent in Charge Brian D. Lamkin said, “The FBI, as part of the multi-agency Wilhelm Strike Force, is pleased to have this career offender off the streets. Burton had integrated himself into an international drug cartel and it was his role to bring that cartel’s interests and product to the Atlanta area and beyond.”

According to United States Attorney Yates, the charges and other information presented in court: Beginning in November 2008, the Federal Bureau of Investigation in Atlanta began to investigate BURTON and his drug-trafficking organization. The investigation quickly revealed that BURTON led a large drug-distribution group that operated in Atlanta. BURTON, and those working for him, distributed wholesale quantities of cocaine, heroin and marijuana during the conspiracy.

In November 2008, the United States District Court for the Northern District of Georgia authorized the first wiretaps of telephones used by members of this organization. From November 2008 to December 2009, the FBI monitored telephones carried by its members, including BURTON. It quickly became apparent that BURTON was working with members of a Mexican drug trafficking cartel to obtain his drugs. In fact, it was not uncommon for BURTON to fly to Mexico himself to negotiate with cartel members concerning the price and quantity of drugs they would ship to him in Atlanta.

During the year-long investigation, BURTON was intercepted on the FBI wiretaps directing the distribution of hundreds of kilograms of cocaine and thousands of pounds of marijuana in the Atlanta area. In July 2009, for example, after intercepting coded talk from BURTON concerning a load of drugs, law enforcement stopped a tractor trailer in McDonough, Georgia carrying 40 kilograms of cocaine destined for BURTON.

BURTON also generated millions of dollars in drug proceeds from the sale of the narcotics. In an effort to launder profits from his drug dealing, BURTON funneled drug money through his construction company and the other businesses he owned. It is estimated that BURTON laundered over $1.5 million in drug proceeds this way.

BURTON and eight other individuals were indicted in December 2009, on drug trafficking and money laundering charges relating to the drug conspiracy. PRINSTON CARTER was sentenced to four years in prison on May 18, 2010, for his role in the offense. DECARLO TATUM was sentenced to 11 years, three months’ imprisonment on July 28, 2010. RUFINO PRUNEDA received a nine-year prison sentence on August 18, 2010. INNECENCIO OCHOA, DAVID RUIZ, and OTONIEL HERRERA await sentencing in the case. MARCO DURON remains a fugitive.

BURTON was sentenced to 30 years in prison to be followed by five years of supervised release. The court also ordered the forfeiture of BURTON’s vehicles and house in Clayton County, Georgia. BURTON was convicted of these charges on May 26, 2010, after entering his guilty plea with the District Court.

This case was investigated by special agents of the Federal Bureau of Investigation.

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