Michael Eugene Kelly (6 October 1949 – 22 December 2013) was a dual citizen of the U.S. and Mexico
[ who operated a number of fraudulent resort enterprises and the Avanti Motor Corporation. In 2007, with 23 others, he was accused by the ]FBI
The Federal Bureau of Investigation (FBI) is the domestic intelligence and security service of the United States and its principal federal law enforcement agency. Operating under the jurisdiction of the United States Department of Justice, t ...
and the United States Attorney's Office
United States attorneys are officials of the U.S. Department of Justice who serve as the chief federal law enforcement officers in each of the 94 U.S. federal judicial districts. Each U.S. attorney serves as the United States' chief federal ...
of operating an enormous Ponzi scheme
A Ponzi scheme (, ) is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. Named after Italian businessman Charles Ponzi, the scheme leads victims to believe that profits are comi ...
that defrauded over a thousand elderly and senior citizens of their retirement money. It was later disclosed that 7,000 victims from throughout the U.S. lost more than $342 million.[
]
Fraud charges
Kelly was arrested at the Mayo Clinic in Rochester, Minnesota
Rochester is a city in the U.S. state of Minnesota and the county seat of Olmsted County. Located on rolling bluffs on the Zumbro River's south fork in Southeast Minnesota, the city is the home and birthplace of the renowned Mayo Clinic.
Ac ...
on December 22, 2006. He claimed to earn $55,000 a year and had only $48,000 in assets, yet he offered a private jet, four yachts and a race track as collateral at his detention hearing. All of his assets were located outside the U.S.[ He was denied bail and remanded to the ]Metropolitan Correctional Center, Chicago
The Metropolitan Correctional Center, Chicago (MCC Chicago) is a United States federal prison in Chicago, Illinois, which holds male and female prisoners of all security levels prior to and during court proceedings in the Northern District of Ill ...
.
Kelly attempted to avoid indictment by arranging a plea agreement
A plea bargain (also plea agreement or plea deal) is an agreement in criminal law proceedings, whereby the prosecutor provides a concession to the defendant in exchange for a plea of guilt or '' nolo contendere.'' This may mean that the defenda ...
that included paying restitution to the victims. On 14 May 2008, he pleaded not guilty to 14 counts of fraud and was remanded in custody.[About Michael Eugene Kelly]
Unofficial anti-fraud website, which includes a timeline of the proceedings On April 14, 2009, a court permanently enjoined him from violating sections of the Securities Exchange Act of 1934
The Securities Exchange Act of 1934 (also called the Exchange Act, '34 Act, or 1934 Act) (, codified at et seq.) is a law governing the secondary trading of securities (stocks, bonds, and debentures) in the United States of America. A landma ...
. On June 30, 2012, he remained in prison as the court liquidated assets with a view to providing partial restitution to victims of the Ponzi scheme.
In December 2012, he was sentenced to 5 years in prison with a $10-million bond to secure lenient periods of house arrest for treatment of colorectal cancer.
References
External links
SEC vs. Michael E Kelly, Michael P Kelly, Donald L Kelly and 23 others
Final news item, 27 October 2006
* Brady-Lunny E
SEC: B-N man defrauded seniors of over $6.4 million
' Pantagraph (Bloomington, Illinois), 12 September 2007
Mexico Timeshare News
at The Gatehouse website, 6 September 2014
Michael E. Kelly Pleads Guilty in First Stage of Resolving $500 Million Timeshare Ponzi Scheme
at Inside the Gate website, 14 December 2012
{{DEFAULTSORT:Kelly, Michael Eugene
American construction businesspeople
1949 births
2013 deaths