Anchorage Man Sentenced to More Than Three Years in Prison for Investor Fraud Scheme
|U.S. Attorney’s Office March 22, 2013|
ANCHORAGE—U.S. Attorney Karen L. Loeffler announced today that an Anchorage man was sentenced in federal court in Anchorage for fraudulently obtaining over $300,000 from Alaska victims.
Donald Lee Smith, 61, of Anchorage, was sentenced to just over three years in prison today by Senior U.S. District Court Judge H. Russell Holland, who imposed a term of 37 months in prison, followed by a three-year term of supervised release. Smith was ordered to pay $316,150.58 in restitution, with credit for $25,000 in payments made at the time of sentencing. Two of the victims addressed the court, discussing the financial and emotional impact they suffered because of Smith’s crimes.
Smith pled guilty on August 6, 2012, to engaging in an investment fraud scheme and that he fraudulently obtained over $300,000 from victims in Alaska during 2007 and 2008. Smith pled guilty to one count of wire fraud and one count of money laundering in connection with the scheme. Smith admitted that he obtained over $300,000 from the victims by making intentionally false representations about investment opportunities. Smith admitted that he obtained the funds from his investors and lenders without telling them that he was using a substantial portion of their money to gamble in casinos rather than invest in properties. According to the admissions made in court, the victims transferred funds from Anchorage to Oklahoma, which the defendant then withdrew and transferred money to other accounts, knowing the money was criminally derived.
Smith was indicted by a federal grand jury in December 2011 and was originally charged with 12 counts of mail and wire fraud and one count of money laundering. Smith lived in Alaska when the scheme began but then moved to Oklahoma, according to court documents.
“Defendant Smith took advantage of the trust of his victims. The three-year sentence imposed demonstrates the seriousness of his criminal conduct. We will continue to work with our law enforcement partners to protect victims of financial fraud and rigorously prosecute those who seek to steal the savings of others through fraudulent schemes,” stated U.S. Attorney Karen L. Loeffler.
“I hope that today’s sentence serves to bring some closure to those victims defrauded by Mr. Smith,” said FBI Acting Special Agent in Charge Kevin C. Donovan. “On behalf of the FBI, I would like to thank the U.S. Attorney’s Office and IRS-Criminal Investigation for their unwavering commitment to this investigation and prosecution. Working together, we will continue to pursue those who misrepresent themselves or their intention to defraud innocent victims.”
Ms. Loeffler commends the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation Division for the investigation of this case.