Department of Justice Releases Approximately $1,000,000 in Funds to Pay Victims of Hendersonville Investment Scam

ASHEVILLE, NC—The Department of Justice has released $997,899.47 in forfeited funds to the Western District of North Carolina clerk of court, to be distributed to the victims of an investment scam carried out by two individuals who operated a Henderson County business, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina.

U.S. Attorney Tompkins is joined in making today’s announcement by North Carolina Secretary of State Elaine F. Marshall; Chris Briese, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division; and Kelly M. Nesbit, United States Marshal, of the United States Marshals Service for the Western District of North Carolina. The two individuals, Bryan Keith Noel, 41, of Hendersonville, and Alexander Klosek, 33, of Etowah, were charged separately in U.S. District Court in 2009 with conspiracy to commit fraud, and other crimes, in connection with a fraudulent investment business started by Noel in 1999 soliciting investors and offering estate planning services geared toward retirees. According to filed documents and court proceedings, the defendants solicited over 100 clients, mostly local retirees, to invest money with Certified Estate Planners, a business owned by Noel. Noel and Klosek then diverted several million dollars to another company without the investors’ knowledge, significantly reducing the value of their clients’ investments. Noel and Klosek then lied to the investors by telling them that their assets had grown significantly, when, in fact, the clients’ assets had dwindled to about $1 million.

In March 2010, a federal jury found Noel guilty, and U.S. District Judge Richard Voorhees sentenced him to serve 25 years in prison. He was also ordered to forfeit seized property, including the $997,899.47 in funds, and to pay restitution in the amount of approximately $11 million to individual victims and banks. Noel has appealed his conviction and sentence. Klosek, who pled guilty to one count of conspiracy to commit mail fraud, received 87 months’ imprisonment, was ordered to forfeit the $997,899.47 in funds, and was ordered to pay restitution in the amount of approximately $10.5 million to the victims of the investment fraud. The FBI had seized the funds from a Noel and Klosek entity, Pinnacle Fiduciary and Trust Group, during the earlier phases of the investigation of Certified Estate Planners. In turn, the U.S. Marshals Service held the funds pending conclusion of the case. This week, after the U.S. Attorney’s Office obtained the approval of the Department of Justice Asset Forfeiture and Money Laundering Section to return the funds to victims, the U.S. Marshals Service released the funds to the court for distribution to individual victims identified in the Klosek case.

U.S. Attorney Anne M. Tompkins noted in making the announcement today, “We place a high priority in this district on using federal debt collection tools and forfeiture laws to the benefit of victims. When Noel and Klosek were first charged, this office noted that the victims had waited a long time for that day and expressed this office’s hope that the filing of charges would be the first of many steps toward seeing justice served. Since then, Noel and Klosek were convicted and sentenced to lengthy prison terms. Today marks another step toward justice. While not replacing all of the money lost or eliminating the anguish suffered, we hope this disbursement of money provides at least some measure of restitution for these deserving victims.”

“Sadly, it is a rare thing when you can get investment fraud victims their money back from a financial scam,” NC Secretary of State Elaine Marshall said Friday. “So while these seized funds certainly do not equal what was taken from the victims in this case, I am sure it will give them some significant financial relief. The FBI has done a great job in finding these monies and I appreciate their efforts to help these victims.”

The investigation was handled by the FBI, and the Securities Division of the Office of the North Carolina Secretary of State. Substantial assistance on forfeiture was provided by the Department of Justice Asset Forfeiture and Money Laundering Section and USMS. The prosecution was handled for the government by former Assistant U.S. Attorney Matthew Martens and Assistant U.S. Attorneys Melissa Rikard and Edward Ryan, of the U.S. Attorney’s Office in Charlotte. The forfeiture aspects of the case were handled by Assistant U.S. Attorney Benjamin Bain-Creed of the U.S. Attorney’s Office in Charlotte.