Lebanon County Man Charged in $1 Million Investment Fraud Scheme
|U.S. Attorney’s Office December 06, 2013|
The United States Attorney’s Office for the Middle District of Pennsylvania announced the filing of an Information in U.S. District Court in Harrisburg Thursday charging Christopher Burhans, age 64, of Lebanon County, Pennsylvania, with conspiracy to commit mail fraud.
According to United States Attorney Peter J. Smith, in or about 2003, Burhans started a private mortgage company known as Angelic Ventures. The stated business purpose of Angelic Ventures was to solicit private investors to provide money for private mortgages. Later, in about 2006, Burhans started a business known as Home Buyers Solutions Inc. (HBSI). HBSI, like Angelic Ventures, was in the business of making private real estate loans financed with private investor funds. Burhans operated both businesses out of his home located at 847 Maple Street in Lebanon, Pennsylvania.
Burhans carried out the scheme to defraud the individuals who invested in Angelic Ventures and HBSI by placing advertisements in several farming newspapers, including “Fish Wrapper,” “Die Botschaft,” and “Lancaster Farming,” announcing an investment opportunity with Angelic Ventures and HBSI. In the advertisement, Burhans represented that the investments were insured, secured, and promised rates of return as high as 12 percent.
Burhans falsely represented to investors that their money would be solely used to make loans for the purchase of real estate.
Between on or about April 1, 2005 to on or about May 1, 2007, Burhans received and deposited into the Angelic Ventures Real Estate Escrow Account approximately $1,880,150 received from investors.
Between on or about November 2006 to on or about April 2008, Burhans received and deposited into the HBSI bank account approximately $450,000 received from HBSI investors.
In December 2009, Burhans wrote to Angelic Ventures and HBSI investors stating that due to the downturn in the economy, Angelic Ventures and HBSI were no longer in business. In the December 2009 letter, Burhans misrepresented to investors that the business losses “ate up even our reserves and all our own personal belongings.” As of December 2009, Burhans owed Angelic Ventures and HBSI investors in excess of $1,000,000.
Burhans misappropriated much of the money he received from investors. He diverted money to other businesses he owned and for his own personal needs and expenses, including payment of a salary for himself, his wife, and his son. Burhans also used investor money to purchase multiple timeshares he used for vacation.
The investigation was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Joseph J. Terz.
The U.S. Attorney’s Office also filed a plea agreement which must be approved by the District Court.
Indictments and criminal informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is five years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public, and provide for the defendant’s educational, vocational, and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.