More people come forward in FBI investigation of local pyramid scheme

FBI seeks seizure of Apostelos’ assets

An affidavit in support of seizure warrant and FBI sources have identified several assets owned by William and Connie Apostelos and their companies:

The companies Apostelos used in the alleged scheme include:

The FBI asks anyone who has invested with Apostelos to call:

(937) 222-7485 or Springboro police at (937) 748-0611.

The companies Apostelos used in the alleged scheme include:

The FBI asks anyone who has invested with Apostelos to call:

(937) 222-7485 or Springboro police at (937) 748-0611.

Update (Nov. 1), 3:45 p.m.:

About 50 people who have dealt with William and Connie Apostelos have called the Federal Bureau of Investigation a day after the newspaper published a story about the couple’s alleged Ponzi scheme.

“Of those calls, some were from attorneys who are representing individuals in civil actions against William and Connie, and some were individual investors who wanted to call and report that they had lost their investment,” FBI Supervisory Senior Resident Agent Timothy Ferguson said Saturday morning.

The Springboro couple is named in an FBI-signed seizure warrant and U.S. Bankruptcy court filings as the masterminds of a financial pyramid scheme that one attorney said could result in investors’ losses being “north of $50 million.”

According to an affidavit filed in federal court, a five-month investigation has revealed more than 160 individuals from the greater Dayton area invested in the pyramid scheme, and that from November 2012 to May 2014, more than $32 million was deposited into accounts controlled by Apostelscos and $28 million was transferred to prior investors. Investigators said the scheme could span several more years.

“We wanted to get the story out there to make sure that there were no other investors that were working with him and if anybody was thinking about it, they would stop, No. 1,” Ferguson said. “And No. 2, if there were any (other) victims out there, we could identify them.”

William and Connie Apostelos, Scott A. Doak and Rebekah Fairchild, who are all named as suspects in the affidavit, have not been arrested, charged or indicted with any crimes and the investigation is ongoing, Ferguson said. The Apostelos’ Springboro residence and business were raided Wednesday and documents are being studied by the FBI, Springboro police, the Internal Revenue Service and state law enforcement officials.

Doak disputes the government’s claim that he was involved in the alleged scheme.

“The facts are that I am a physician who is another of Mr. Apostelos’ victims to the tune of well over a million dollars,” he wrote in an email to the newspaper.

The FBI asks anyone who has invested with Apostelos to call: (937) 222-7485 or Springboro police at (937) 748-0611.

First Take:

A local couple swindled “north of $50 million” from nearly 200 Miami Valley investors in Ponzi-type financial pyramid schemes to fund an extravagant lifestyle that included buying racehorses and a $1 million farm in Clark County, according to federal court documents and the Federal Bureau of Investigation.

William M. Apostelos, 53, and his wife Connie M. (Cooper) Apostelos, 49, robbed one family of more than $5 million and owes about $7 million to others through local seven Warren County court judgments, according to filings in United States Bankruptcy Court.

FBI Supervisory Senior Resident Agent Timothy Ferguson said the couple reside at the Tanglewood Drive residence in Springboro the FBI raided Wednesday morning.

“I think the truly tragic part about it is there are going to be a lot of people in the Miami Valley who’ve been victimized and, in some circumstances, have lost everything,” said attorney Toby Henderson, who along with Robert Hanseman is representing creditors in Apostelos’ forced bankruptcy stemming from the allege pyramid scheme.

According to an affidavit filed in federal court, a five-month investigation has revealed more than 160 individuals from the greater Dayton area invested in the pyramid scheme, and that from November 2012 to May 2014, more than $32 million was deposited into accounts controlled by Apostelos and $28 million was transferred to prior investors.

The “shell” companies Apostelos used in the alleged scheme include Apostelos Enterprises Inc., Coleman Capital, Inc., Midwest Green Resources, LLC, WMA Enterprises, LLC, OVO Wealth Management, LLC and Silver Bridle Racing, LLC —many of which are housed at 35 Commercial Way in Springboro.

“In addition to ripping these investors off, basically, he was taking some of this money and purchasing several assets including cars and horses down in Kentucky,” Ferguson said.

Records indicate Apostelos’ alleged victims include professionals such as doctors, cops and area car dealerships.

“We know of law enforcement officers who have invested with him and lost their entire life savings,” Ferguson said. “It was spread a lot by word of mouth. One person would bring someone else in and, unwittingly — I don’t think it was intentional — but they were receiving large percentage ‘returns’ on their investments when, in actuality, it was just that someone else was investing.”

The Apostelos — and other possible co-defendants Rebekah E. Fairchild and Scott A. Doak — have not been arrested nor charged.

“It is an ongoing investigation because we believe that there are a whole lot more victims than we have identified,” Ferguson said. “So, what we’re trying to do is identify who all the victims are so that we can determine exactly what the extent of the fraud is. That, in and of itself, is going to determine restitution and it’s going to determine prison sentences as well.”

The potential criminal violations of the four individuals include wire fraud, conspiracy and money laundering. The FBI asks anyone who has invested with Apostelos to call (937) 222-7485 or Springboro police at (937) 748-0611.

“To the extent that people have investments with Mr. Apostoles, they may want to take a very hard look at those,” Henderson said. “If they feel like they’ve been victimized, they probably should reach out and chat with law enforcement or somebody else.”

The seizure affidavit states that Apostelos “enticed investors to send him money with false promises as to how he would invest these funds and the rates of return that would be repaid for those investments” and that he guaranteed rates from 10 to 20 percent. The promissory notes were typically signed by Apostelos and notarized by Fairchild, Apostelos’ sister.

One retired doctor who invested $3.34 million was persuaded by Apostelos to sign a power of attorney, according to a declaration in a bankruptcy court document: “Because I had invested most everything I owned with (Apostelos), he assured me I would be able to live off my investments.”

The doctor wrote that when the monthly payments stopped, Apostelos said the money had been invested with TD Ameritrade, which transferred it to PNC Bank. The doctor added that Apostelos wrote a $1.2 million check from the doctor’s account into his own and then claimed the money was no longer accounted for and unable to be recovered. The doctor’s family won a judgment in a Warren County court for $5.53 million, which remains unpaid.

Ferguson said it will take time for the Internal Revenue Service, FBI, Springboro police and Ohio officials to go through paper records and computer files before a full picture is presented to prosecutors.

“We have a whole lot of work to do now that we’ve done the search warrants and got all those documents,” Ferguson said. “So it’s going to take us some time to go through all the documents and identify all the victims and get a closer amount of loss or fraud.”

Bankruptcy court documents file by creditors’ attorneys state that Apostelos “simply cannot be trusted” and that he told a petitioning creditor that he will “sell it all.” Apostelos transferred the 168-acre farm he purchased for $1 million near South Vienna in Clark County into a trust and named his attorney, Steven C. Scudder, as trustee, according to a court document.

Investigators are at the “tip of the iceberg” learning about Apostelos’ years-long scheme that spans several states, said Henderson, one of the attorneys representing creditors in Apostelos’ bankruptcy.

“We are concerned that he’s liquidating, that he’s going to hide assets” through the bankruptcy and criminal process, Henderson said. “There are real concerns there: Knowing where this money is; where the resources have gone. From a civil perspective, that’s the real challenge.”