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Two more indicted in Warren Ponzi scheme



Published: Sun, August 25, 2013 @ 12:05 a.m.

By Ed Runyan

runyan@vindy.com

YOUNGSTOWN

Keelan Harris, 37, of Warren, is in federal custody, detained by U.S. officials after he was indicted last week by a federal grand jury in the Ponzi scheme for which his brother, Kevin Harris, was sent to prison in 2012.

The grand jury also indicted Karen Starr of Ontario, Canada, for her role in the enterprise, which she and the Harris brothers operated out of the former electrical- workers union hall on Parkman Road Northwest from 2006 to 2009. Starr remains at large.

Keelan Harris pleaded innocent in Youngstown federal court Wednesday, and he was taken into custody pending a hearing Monday in Cleveland federal court to determine whether he can remain free while the case is pending.

He is charged with eight counts of wire fraud and four counts of money laundering, accused of scheming to defraud customers of Complete Developments LLC and Investments International Inc. by giving false representations about the investments they sold. Starr is charged with eight counts of wire fraud.

Kevin Harris was sentenced to seven years in prison for his role in the scheme, which prosecutors said bilked hundreds of investors, most of them from the Toronto area but also from the U.S., out of $15.8 million.

The companies promised returns ranging from 7 percent to 12 percent per month and told investors that 80 percent of their principal investment would be secure and returned at the end of the program.

But by 2008, the investors learned their accounts had been frozen, and their money was never returned. Kevin Harris has been ordered to pay restitution of $15.8 million to the victims, but they believe very little of the money remains.

The Harris brothers and Starr used the money on themselves and to make phony “interest” payments to keep the enterprise afloat until the money ran out, prosecutors said.

The companies claimed to be investing money in foreign-currency exchange, but the Harris brothers and Starr did practically no Forex trading with the money, officials said.

Among the crimes Keelan Harris and Starr are accused of are concealing the fact that they and Kevin Harris previously had been convicted of fraud and fraud-related crimes.

Keelan Harris and Starr are also accused of “lulling” activities, intended to dissuade investors from contacting law-enforcement and civil-regulatory authorities, according to the indictment.

It lists eight bank transactions totaling about $800,000 that took place between September 2008 and April 2009 from the companies’ bank accounts in Ontario, Canada; Warren and Panama to bank accounts in Warren, Panama and Buffalo, N.Y., that constituted mail fraud, according to the indictments.

Dominic Ventura of Toronto, one of the investors, said of the indictments of Keelan Harris and Starr said, “It’s about time. As the grand schemer, Kevin Harris sits in jail, it is fitting his two accomplices are now being hunted down.

“These are a fraudulent few who would extend a hand to shake while the other hand is on the take. With eyes of concern they pretend to be family people but are ruthless criminals looking to take anything and everything they can.”


Comments

1southsidedave(4841 comments)posted 1 year, 3 months ago

$15.8 million...how much is enough???

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