A member of the Winans gospel-music family has pleaded guilty in an $8 million scam involving bogus bonds.
The government says 30-year-old Michael Winans knew Saudi Arabian oil bonds weren't real, but he continued to accept money from more than 1,000 investors in 2007 and 2008. The court document says Winans recycled the money among investors and also used cash for his personal use.
Winans is the grandson of the late David "Pop" Winans Sr.
Hatchett says no Winans family members were involved in the operation.
Information presented to the court at the time of the plea showed that Winans operated the Winans Foundation Trust (the Trust) and represented that the Trust was a company investing in crude oil bonds in Saudi Arabia. Winans initially recruited eleven other individuals, whom he called "shareholders" in the Trust, to invest in the crude oil bonds. Winans required the "shareholders" to solicit additional investors and send the investors' funds to the Trust. Over 1,000 victim investors from several states sent over $8,000,000 to the Trust. All of these victims were led to believe they were investing in Saudi Arabian crude oil bonds that Winans well knew did not exist. Winans guaranteed the victim investors that the bonds would yield returns of $1,000 to $8,000 within 60 days.
In reality, Winans converted some of the victim investors' money to his own personal use while giving some of his later victims' money to his earlier victims, and falsely represented
to them that it was the return on their "investments" he had promised.
Winans sentencing has been set for Feb.27, 2013. He faces a statutory maximum penalty of 20 years in prison.
A telephone line and e-mail address have been set up by the FBI/United States Attorney’s Office to collect information about potential victims. Individuals who believe they may have been a victim of the Winans Foundation Trust should provide their name, address, phone number and e-mail address to one of the following: e-mail:
email@example.com or toll free 1-888-702-0553.
For those wishing to call the toll free phone line, please call after Thursday. A representative of the FBI will follow up with potential victims for further information.