Retired Boston Police Officer Arrested, Indicted in Investment Fraud Scheme
|U.S. Attorney’s Office March 21, 2014|
BUFFALO, NY—U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury has returned a five-count indictment charging Daniel Rice, 50, a retired Boston, Massachusetts police officer, with wire fraud and conspiracy to commit wire fraud. The charges carry a maximum penalty of 20 years in prison and a fine of $250,000.
Assistant U.S. Attorney Paul J. Campana, who is handling the case, stated that Rice is charged with causing a broker from Montana to wire $250,000 in March 2009 to Carnic Services LLC, one of the “New Frontier” companies controlled by Michael Wilson, formerly of Hamburg, New York. According to the indictment, by March 2009, Rice (the defendant) knew that Michael Wilson’s companies failed to pay out on deals promising large returns in short periods of time. Wilson is currently under indictment for deals entered into by his companies in 2008 through 2010.
The indictment against Rice also charges that, in two deals brokered in January and July of 2010, the defendant intentionally failed to tell the same Montana broker that the company offering the investment program “Zodiak Capital” was another of Wilson’s companies. As a result, in January 2010, the Montana broker wired $100,000 to Rice, who kept $40,000 before passing the remaining $60,000 on to a Wilson account at HSBC Bank in Buffalo. In July 2010, Rice was involved in a second deal with Zodiak, and again failed to tell the Montana broker about Zodiak’s connection to Wilson’s companies. As a result, on July 15 and 19, 2010, a total of $71,875 of a different investor’s money was wired to accounts in the Buffalo area controlled by Zodiak. None of these deals paid out. The only money ever recovered was the $71,875 wired to Zodiak in July 2010, which was recovered because the government quickly applied to have the receiving bank accounts frozen. The funds eventually were returned to the investor, who lives in Utah.
Rice was arrested today in Stoughton, Massachusetts and made an appearance in U.S. District Court in Boston, after which he was released. The defendant will be arraigned in Buffalo before U.S. Magistrate Judge Jeremiah J. McCarthy on March 28, 2014 at 2:30 p.m.
The indictment is the result of an investigation by the Federal Bureau of Investigation, with assistance from the Boston Police Department Anti-Corruption Division.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.