Bay Area Man Pleads Guilty to Investment Scam

SAN FRANCISCO—Malcolm McVickar, Jr., pleaded guilty in federal court in San Francisco yesterday to mail fraud and wire fraud, United States Attorney JOSEPH P. RUSSONIELLO announced today.

In pleading guilty, Mr. McVickar admitted to devising a short-term investment scheme in which he promised fixed rates of return. Mr. McVickar admitted making a number of false representations in conjunction with the investment scheme, including:

1. Investors’ money would be invested in the “Phoenix Private Investment Fund (“PPIF”), a legitimate investment fund involved with the Foreign (Currency) Exchange Market, the stock market, and real estate investments.
2. PPIF was managed by friends that Mr. McVickar met at school.
3. Investors would receive a fixed monthly interest payment on his or her investment.
4. Investors in the PPIF “doubler” program would receive double their investment within a short fixed time period.
5. Investors could withdraw the principal investment after a fixed period of time.
6. Mr. McVickar was the agent and investor contact for PPIF, and an investor could not contact the fund managers directly.
7. Mr. McVickar was unable to disclose any facts about the investments due to non-disclosure agreements.
8. The investments had “a money-back guarantee for a fail-safe investment.”
9. Mr. McVickar was personally responsible for insuring that investor funds were “handled professionally, and that all funds are paid back in a timely fashion per the anticipated schedule.”

Mr. McVickar used the money he obtained from the investors to pay off earlier investors, to make other undisclosed investments that were not for the benefit of the investors, and for personal expenses. As a result of the fraud scheme, Mr. McVickar obtained a total of $436,583.37 from multiple victims. As part of the plea agreement, Mr. McVickar agreed to pay restitution to victims as ordered by the Court.

Mr. McVickar was indicted by a federal Grand Jury on May 5, 2009. He was charged with three counts of wire fraud in violation of 18 U.S.C. § 1343 and three counts of mail fraud, in violation of 18 U.S.C. § 1341. Under the plea agreement, Mr. McVickar pled guilty to all counts.

The sentencing of Mr. McVickar is scheduled for December 18, 2009 before Judge Consuelo B. Marshall in San Francisco. The maximum statutory penalty for each count in violation of 18 U.S.C. §§ 1341 and 1343 is 20 years in custody and a fine of $250,000, plus restitution if appropriate. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

Christina Hua is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Elizabeth Garcia. The prosecution is the result of an investigation by the Federal Bureau of Investigation.