Folsom Man Arrested in High Yield Investment Fraud Scheme

Steve K. Wilson, aka Stefan Andre Wilson, age 44, was arrested yesterday evening without incident at his home located at 730 Glen Mady Way, Folsom, California, on charges related to a fraudulent high yield investment program. Drew Parenti, Special Agent in Charge of the Sacramento FBI and Scott O’Briant, Special Agent in Charge of IRS Criminal Investigation, announced the arrest.

According to allegations contained in the affidavit in support of the complaint, Wilson managed a hedge fund operating under the names Christians in Crisis Investment Fund, Shake the Nations and Opus Capital Holdings. Wilson solicited individuals to invest in what he described as a high risk hedge fund which, based on the investment agreement, promised investors a 2% monthly return (24% annual return) on their investment. The agreement also gave the investors the ability to withdraw earnings or after one year, the investor could ask for the return of their principal.

Investigators determined that Wilson maintained two financial accounts associated with Christians in Crisis (CIC). Investor contributions were deposited into a Washington Mutual (WaMu) account in the name of CIC Investment Fund. A portion of the money was then transferred into an Ameritrade brokerage account in the name of CIC International. An analysis of these two accounts demonstrates that the CIC Investment Fund operated as a Ponzi scheme.

During the period of March 2006 through July 2007, approximately $9 million was deposited into the WaMu account. These deposits were in the form of personal checks, cashier’s checks and wire transfers from various investors and were payable to CIC Investment Fund. Approximately $6.4 million was transferred from the WaMu account to the Ameritrade account where Steve Wilson engaged in day trading in the stock market. The Ameritrade brokerage account sustained approximately $5.1 million in trading losses. Of the roughly $3.85 million of remaining money in the WaMu account, Wilson withdrew at least $1.1 million for personal expenses and disbursed approximately $2.06 million to investors as capital appreciation or earnings. These payments were not the result of earnings and appear to be lulling payments to investors so as not to arouse suspicion. The capital appreciation or earnings payments were made with new investor’s money.

On February 15, 2008, Special Agents with the FBI and the IRS Criminal Investigation executed search and seizure warrants on Wilson’s home and business. A lis pendens has been filed against Wilson’s residence and items seized pursuant to the seizure warrant included a 2007 Porsche Cayman, a 2006 Sea Ray vessel, a brokerage account and a bank account.

Wilson was booked into custody last night and will make his initial appearance in federal court today at 2:00 p.m. in Sacramento, California.

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