Jacksonville Man Convicted of Orchestrating a Scheme to Defraud, Attempting to Murder a Witness, and Murder-for-Hire
|U.S. Attorney’s Office February 12, 2013|
JACKSONVILLE—A federal jury yesterday found Paul S. Kruse (59, Jacksonville) guilty of conspiracy, wire fraud, attempting to murder a government witness, and murder-for-hire. Kruse faces a maximum penalty of 20 years in prison on the conspiracy conviction, 20 years for each wire fraud conviction, 30 years for attempting to kill a government witness, and 10 years for his murder-for-hire plot. Kruse’s sentencing hearing is scheduled for June 19, 2013.
Kruse was initially indicted in April 2012. A second superseding indictment was filed on November 1, 2012.
According to the evidence presented at trial, beginning in 2010, Kruse and his brother conspired to recruit and defraud a number of clients to whom they provided financial advisory services. Although Kruse and his brother had been licensed financial advisors for decades, at the time of the scheme, both were unlicensed. As part of the scheme, Kruse established a sham investment firm called Yorkshire Financial Services. Kruse and his brother convinced their clients, a number of whom were retirees, to move their individual retirement accounts (IRAs) to Yorkshire. Kruse and his brother deceptively told clients that Yorkshire had been in business for more than 30 years, had a staff of experienced securities traders, and traded in a combination of stocks, bonds, and currencies appropriate for IRAs. In reality, Kruse did not invest the investors’ funds. Rather, he spent the investors’ money on luxury cars, home improvements, personal items, and made hundreds of thousands of dollars in cash withdrawals.
In early 2011, Kruse hired a personal assistant who witnessed Kruse’s conduct, which included forging investors’ signatures, not engaging in investment activity, and lavish spending of investors’ money. While Kruse was out of town, the assistant took the documents from the Yorkshire scam to the Federal Bureau of Investigation. In early 2012, Kruse approached the FBI and provided a voluntary written confession of his guilt in running an investment fraud scheme.
After Kruse’s confession, his co-conspirator brother committed suicide. Kruse was subsequently held in custody on pre-trial detention. While in jail, Kruse hired hitmen to murder his former personal assistant. The assistant was scheduled to be a government witness. Kruse stated that he wanted the former assistant killed to prevent her from testifying and to avenge his brother’s death. Kruse also hired the hitmen to rob and kill two former business partners, whom Kruse contended had cheated him. Unbeknownst to Kruse, the hitmen were undercover federal agents.
This case was investigated by the FBI and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. It is being prosecuted by Assistant United States Attorney Mark B. Devereaux and Trial Attorney Ryan Rohlfsen, with the U.S. Department of Justice, Criminal Division, Fraud Section in Washington, D.C.