The former Portland developer, Michael Liberty, has been charged with wire and securities fraud as part of a multi-million dollar ploy to get investors to invest in a new financial technology company. Wednesday, officials announced the US Department of Justice.
Liberty, 58, of Windermere, Florida, and Paul E. Hess, 63, of Braintree, Mass., Were each charged in an indictment filed Wednesday in federal court in Portland with a chief. Charges of conspiracy to commit online fraud and four charges of wire fraud and a charge of securities fraud, according to a press release issued by the Ministry. In addition, Liberty was charged with one count of conspiracy to launder money and three counts of money laundering.
Liberty had previously been charged with fraud in a civil case filed last year by the Securities and Exchange Commission. The SEC has accused Liberty and others of defrauding investors for nearly $ 50 million. Liberty and other defendants have denied the allegations in their official responses to the SEC's action.
Wednesday's indictment states that Liberty and Hess had solicited, beginning in 2010, investments in Mozido, a private start-up in the financial technology sector based in Austin, Texas, which offered users a way to to pay with their mobile phone, says the release.
Liberty and Hess reportedly collected millions of dollars from investors, telling them that their money would be used to finance Mozido's commercial activities and that he was not paid to do so.
The indictment alleges that much of the money has not been donated to Mozido – what Liberty describes as a mobile wallet. Some of the money was diverted to pay for Liberty's personal expenses, while Hess received commissions and other payments for the money he raised from investors, according to the Department of Justice.
Portland-based Liberty lawyer Thimi R. Mina said his client "categorically denies criminal charges" and hopes to be exonerated. Mina issued a statement on behalf of her client Wednesday night in response to the government's legal actions.
"The fact that there is already a civil lawsuit filed by the Securities & Exchange Commission in the District of Maine, which is the appropriate forum to deal with these allegations," Mina emphasizes. I said.
Mina said Liberty founded Mozido more than a decade ago and had helped the company become an innovative leader in the mobile wallet market, which had won several patents worldwide.
"Mr. Liberty has been recognized as a visionary who wanted to give millions of unbanked people access to a mobile financial platform that would provide them with upward economic mobility and hope for a better life," said Mina.
Mina said investors would benefit from these unique technologies developed by Mozido.
"Ironically, these criminal lawsuits, while claiming to be motivated by the desire to protect Mozido's sophisticated investors, could have a negative impact on the company's ability to take advantage of the patents and technologies coined by Mr. Liberty," he said. said Mina.
Mina added that Liberty would continue "to work tirelessly to develop Mozido's business," while waiting for his day in court.
The accused is liable to imprisonment for up to 20 years and a fine of not less than $ 250,000, to a fine of not more than $ 250,000, to a fine of $ 5 million and a $ 5 million fine. In addition, Liberty is liable to imprisonment for up to 10 years and a fine of at least US $ 250,000 for money laundering.
Liberty is from Gray, Maine. He developed the 100 Middle St. Portland office complex and Chandler's Wharf condominiums in the 1980s before leaving. Although he now lives in Florida, Liberty still holds stakes in Maine and the SEC says most of the activities described in the civil allegations took place in Maine.
Deputy Attorney General Brian A. Benczkowski of the Criminal Division of the Maine Department of Justice, US Attorney Halsey B. Frank, Special Agent in Charge Joseph Bonavolonta of the FBI Office in Boston and Special Agent in Charge Kristina O. Connell of The criminal investigation of the IRS in Boston made the announcement Wednesday of the indictment.
The FBI's resident agency in Portland, Maine, and the IRS-CI are investigating the case. Trial Attorneys Michelle Pascucci and Matthew Sullivan of the Criminal Division Fraud Section and US Deputy Attorney General Donald Clark of the District of Maine continue the case.
The editor of the city, John Richardson, contributed to this report.
Dennis Hoey can be contacted at 791-6365 or at:
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