Central Coast Man Pleads Guilty in Fraud Scheme That Bilked In-Laws, In-Laws’ Friend, and Banks of Nearly $50 Million
|U.S. Attorney’s Office April 29, 2013|
SANTA ANA, CA—A Central Coast man pleaded guilty this afternoon in a wide-ranging fraud scheme that caused more than $47 million in losses to several victims, including his in-laws, who were long-established and well-respected farmers in San Luis Obispo County.
John Mark Moore, 51, of Nipomo, pleaded guilty today to federal charges relating to his fraud scheme, which continued for well over a decade until he came clean to his family in the fall of 2011 and then to federal authorities last year.
Appearing before United States District Judge David O. Carter, Moore pleaded guilty to four federal offenses: two counts of making false statements to Farm Credit West (FCW), a production credit association in Templeton, California; one count of mail fraud; and one count of wire fraud.
Over the course of 11 years, Moore misappropriated approximately $24 million from his in-laws, plus another $23 million from five banks and another individual who was a friend and business associate of his in-laws.
According to court documents, Moore took unauthorized disbursements from the bank accounts and lines of credit belonging to his father-in-law and mother-in-law. Once he had control of the funds derived from his in-law’s accounts, Moore used the money to support businesses that he and his father controlled. Over the course of approximately 11 years, Moore diverted approximately $13.8 million from his in-laws’ business and personal accounts at FCW and transferred the money to his father’s company, Moore Agricultural Products (which after March 2004 was owned by his mother) or to companies Moore himself owned, such as American Microtech LLC.
In another scheme, Moore also stole money from his in-laws by fraudulently increasing their personal and business lines of credit at FCW and then fully drawing down on these lines of credit without having the ability to repay these loans. Moore improperly increased these lines of credit by repeatedly forging his in-laws’ signatures on several loan applications that allowed him to increase their personal and business lines of credit at FCW—in one case, from $1 million to $6.5 million and, in another case, from $1 million to $4 million. Accordingly, Moore fraudulently borrowed $10.5 million against his in-laws’ business and personal lines of credit from 2000 through 2011, and he fully defaulted on these obligations.
In another scheme, Moore fraudulently obtained funds by increasing his lines of credits he obtained in the name of himself, his wife, his companies, and his mother through various means, including forging his wife’ signature, submitting false personal financial statements, and pledging phony collateral to secure the loans. As a result of this fraudulent borrowing, the victim lending institutions—including FCW, Heritage Oaks Bank, Union Bank, Rabobank, and Happy State Bank in Dumas, Texas—sustained aggregate losses of approximately $11.4 million.
In the fourth scheme in this case, Moore bilked a friend and business associate of his in-laws beginning in 2002 when Moore entered into a series of ranching and farming ventures with the victim. As part of Moore’s scheme to defraud his in-laws’ friend, who is identified in court documents as GLM, Moore entered into a bogus contract in which he agreed to undertake various agricultural ventures and share the proceeds of these ventures with GLM in exchange for GLM providing the start-up capital. However, Moore had no intention of starting agricultural ventures, and instead he used GLM’s money for other purposes. As a result of Moore’s defendant’s fraudulent scheme, GLM lost more than $12 million, which was never repaid.
The false statement charges each carry a statutory maximum penalty of 30 years in federal prison, and the fraud charges each carry a potential penalty of 20 years in prison. Therefore, as a result of his guilty pleas today, Moore faces a potential sentence of 100 years in federal prison. The actual sentence will be determined by Judge Carter when he sentences Moore on July 29.
Moore self-reported his illegal conduct to federal authorities over the course of 2012. Based on the information he provided and a subsequent investigation, the case against Moore is the product of work completed by special agents with the Federal Bureau of Investigation.