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Second Mississippi man indicted in $85M timber Ponzi scheme

MGN Online

A second Mississippi man has been charged in a Ponzi scheme in which investors lost more than $85 million.

Posted: Mar 2, 2019 11:47 AM

JACKSON, Miss. (AP) — A second Mississippi man has been charged in a Ponzi scheme in which investors lost more than $85 million.
William McHenry of Canton pleaded not guilty Friday in federal court in Jackson to an indictment charging him with one count of securities fraud and two counts of wire fraud. He remains free on $10,000 bail with a current trial date of April 15 before U.S. District Judge Carlton Reeves.
McHenry's lawyer, Frank Trapp, did not respond to an email seeking comment.
The scheme's leader, Arthur Lamar Adams, pleaded guilty to wire fraud charges last year and is serving a 17-year prison sentence.
The indictment charges that McHenry was a salesman in a scheme selling bogus timber rights for Madison Timber, claiming investors were buying the rights cheaply from timber owners and selling them at higher prices to lumber mills. Investors loaned money to Madison Timber Properties in exchange for a guaranteed annual interest rate of 12 percent or more, but in reality new loans were used to pay old investors. Adams skimmed some for himself and used some to pay 10 percent commissions to salesmen, including McHenry.
A separate civil suit brought in October by a receiver trying to recover assets charges that McHenry made at least $3.5 million in commissions between 2010 and 2018. The indictment alleges he sold investments worth "well more" than $18 million to more than 25 people.
McHenry operated a separate company called First South Investments, but the indictment says McHenry worked from 2010 to 2018 in a shared office with Adams and Madison Timber. It also says he followed the same procedures as Adams, using fake timber deeds with forged signatures. Investors agreed not to legally record the deeds unless Madison Timber defaulted on its payments. The indictment says McHenry represented that he was part-owner of Madison Timber, when in fact he held no position with the company and had invested none of his own money.
More than 250 investors in at least 14 states lost money in the overall scheme, prosecutors have said. They argued during Adams' sentencing hearing that at least 34 investors sustained "substantial financial hardship." The minimum investment was generally $10,000, but some invested much more.
Among other investors who were defrauded was U.S. Sen. Roger Wicker, the Mississippi Republican.
Receiver Allyson Mills has thus far recovered more than $4 million for investors, according to court filings.

Mississippi Coronavirus Cases

Data is updated nightly.

Cases: 308737

Reported Deaths: 7139
CountyCasesDeaths
DeSoto20901250
Hinds19953410
Harrison17551302
Rankin13358276
Jackson13141243
Madison9949211
Lee9886170
Jones8308161
Forrest7537147
Lauderdale7221237
Lowndes6286144
Lamar613284
Lafayette6063117
Washington5288133
Bolivar4775129
Oktibbeha457097
Panola4456103
Pearl River4433141
Warren4294118
Marshall4283101
Pontotoc417572
Monroe4061132
Union404675
Neshoba4001176
Lincoln3883109
Hancock373385
Leflore3470124
Sunflower330789
Tate325082
Pike3205105
Scott311272
Yazoo304769
Alcorn298865
Itawamba297477
Copiah293965
Coahoma290378
Simpson289486
Tippah285168
Prentiss276559
Marion266279
Leake261473
Wayne261441
Grenada256284
Covington254980
Adams246882
Newton245561
George238347
Winston226081
Tishomingo222467
Jasper219948
Attala213573
Chickasaw205257
Holmes186972
Clay183054
Stone179531
Clarke177576
Tallahatchie175940
Calhoun165231
Yalobusha159736
Smith159234
Walthall131043
Greene129633
Lawrence126623
Noxubee126533
Montgomery125742
Perry125238
Carroll120926
Amite120741
Webster113732
Jefferson Davis105432
Tunica103025
Claiborne101330
Benton97425
Kemper95628
Humphreys94432
Franklin82723
Quitman78916
Choctaw73717
Wilkinson64928
Jefferson64828
Sharkey49817
Issaquena1686
Unassigned00

Alabama Coronavirus Cases

Cases: 521201

Reported Deaths: 10736
CountyCasesDeaths
Jefferson753981490
Mobile39011799
Madison34002496
Tuscaloosa25329444
Montgomery23996567
Shelby23160239
Baldwin20674302
Lee15567165
Calhoun14330311
Morgan14152271
Etowah13677346
Marshall11988220
Houston10402278
Elmore10008200
Limestone9843147
Cullman9501189
St. Clair9449234
Lauderdale9254228
DeKalb8756181
Talladega8104171
Walker7126275
Jackson6751110
Autauga6748103
Blount6511134
Colbert6225130
Coffee5418113
Dale4771111
Russell429338
Franklin420582
Chilton4100109
Covington4059114
Tallapoosa3904146
Escambia389574
Dallas3522149
Chambers3513122
Clarke346760
Marion3072100
Pike306176
Lawrence295395
Winston273072
Bibb256059
Marengo248261
Geneva245975
Pickens233059
Barbour226255
Hale218675
Butler212867
Fayette209460
Henry188044
Cherokee182544
Randolph177041
Monroe172440
Washington164738
Macon155548
Clay150055
Crenshaw149457
Cleburne146341
Lamar139634
Lowndes136553
Wilcox124527
Bullock121540
Conecuh109428
Perry107626
Sumter103232
Coosa99428
Greene91334
Choctaw58724
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