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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: 263023

Reported Deaths: 5752
CountyCasesDeaths
DeSoto17675191
Hinds16813331
Harrison14224204
Rankin11167219
Jackson10839190
Lee9050144
Madison8568168
Jones6668114
Forrest6177124
Lauderdale6097192
Lowndes5518120
Lafayette516298
Lamar503965
Washington4923125
Bolivar4104109
Oktibbeha405982
Panola384881
Pontotoc376258
Warren3674103
Monroe3671108
Union355663
Marshall355270
Neshoba3485154
Pearl River3468105
Leflore3111109
Lincoln305688
Hancock291862
Sunflower291475
Tate279662
Alcorn272354
Pike268981
Itawamba268063
Scott259648
Yazoo255256
Prentiss252553
Tippah249250
Copiah249049
Coahoma248054
Simpson242171
Leake237367
Grenada223272
Marion222073
Covington219973
Adams213671
Wayne212634
Winston207371
George204339
Newton199046
Attala196963
Tishomingo194161
Chickasaw189044
Jasper179538
Holmes171768
Clay165837
Tallahatchie156235
Stone151425
Clarke147262
Calhoun140822
Smith129226
Yalobusha122034
Walthall114337
Greene113529
Noxubee112926
Montgomery111636
Carroll106622
Lawrence106517
Perry104531
Amite101426
Webster96124
Tunica88821
Claiborne88325
Jefferson Davis88329
Benton85623
Humphreys84624
Kemper80520
Quitman7089
Franklin69917
Choctaw63213
Wilkinson59825
Jefferson56821
Sharkey45117
Issaquena1606
Unassigned00

Alabama Coronavirus Cases

Cases: 439442

Reported Deaths: 6657
CountyCasesDeaths
Jefferson644371007
Mobile31435569
Madison28158217
Tuscaloosa21492275
Montgomery19873332
Shelby19248132
Baldwin17128189
Lee13137107
Morgan12594142
Etowah12070181
Calhoun11496206
Marshall10420123
Houston8988164
Limestone832081
Cullman8257124
Elmore8183110
DeKalb7871107
Lauderdale7847107
St. Clair7808130
Talladega6445112
Walker6028183
Jackson599145
Colbert548694
Blount546286
Autauga535862
Coffee460764
Dale409685
Franklin374150
Russell354215
Chilton344373
Covington338580
Escambia334544
Tallapoosa3143109
Dallas312996
Chambers303470
Clarke298036
Pike262431
Lawrence253355
Marion253161
Winston233342
Bibb222348
Geneva210247
Marengo208231
Pickens199531
Hale184944
Barbour180538
Fayette177829
Butler173160
Cherokee165131
Henry159525
Monroe152021
Randolph145536
Washington141727
Clay129746
Crenshaw123745
Macon121937
Cleburne121525
Lamar119922
Lowndes114836
Wilcox107922
Bullock103328
Perry99918
Conecuh97822
Sumter90527
Greene77923
Coosa63418
Choctaw51924
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