By Nathan Baca, News Channel 3 Reporter & KESQ.com Wire Services
nbaca@kesq.com
RIVERSIDE - Seven people face a combined 249 charges stemming from alleged fraudulent securities and mortgage fraud.
Riverside District Attorney Rod Pacheco made the announcement Thursday afternoon, crediting the cooperation of his department with the U.S. Attorneys Office, the Internal Revenue Service, FBI, and the U.S. Postal Inspection Service.
The crimes include the selling of fraudulent securities leading to a loss of more than $17 million, as well as mortgage fraud leading to a loss of $124.5 million throughout Riverside County. The defendants carried out similar schemes in other areas of California and Arizona.
The defendants created several false companies, including Pacific Wealth Management and Stonewood Investments, advertising a quick return of monetary investments through Internet advertising, large investment seminars and word of mouth by victims and the defendants.
Those facing charges include James Benjamin Duncan, 38; Hendrix Moreno Montecastro, 37; Helen Moreno Pedrino, 47; Maurice McLeod, 37; Charlie Sung Muk Choi, 34; Cindi Gayle Kelly, 33; and Thuan Nhan Du, 33.
Update: Helen Pedrino was apprehended at a fast food restaurant about 6:20 Thursday night in Torrance. She is the mother of co-defendant Hendrix Montecastro. Pedrino faces 207 counts in the massive fraud case.
Duncan billed himself as "James the Cash King" in a series of online videos, promising high yields for his customers' investments, allegedly pocketing $19 million by not providing returns.
"These scam artists skillfully deceived their victims with the promise of a better life through making easy money," said District Attorney Rod Pacheco. "By creating the illusion of financial stability they were able to lure in potential investors and then take advantage of their credit to bring in large amounts of money for themselves."
In plea agreements also filed today in United States District Court in Los Angeles, Christopher J. Oetting, 47, of Palm Desert; Linda Brooks, 54, of Murrieta; and Steven Kayden, 51, of Cathedral City; all have agreed to plead guilty to federal charges related to their roles in one or more investment schemes.
Oetting has agreed to plead guilty to money laundering and four counts of filing false tax returns, admitting that he played a key role in fraudulent enterprises that included the Total Return Fund investment fraud, the Stonewood Consulting mortgage fraud, and the fraudulent solicitation of investments in overpriced Iraqi dinars. Brooks and Kayden have each agreed to plead guilty to a single count of conspiracy, both admitting that they participated in the Stonewood Consulting mortgage fraud. They also ran a chell company called Pacific Wealth Management, not affiliated with the business of the same name based out of San Diego.
Richard Ackerman represents over 80 of Duncan's alleged victims. He talks to News Channel 3 about how Duncan allegedly pulled it off, "He was working congregations. Him and Mr. Montecastro were working various churches throughout Southwest Riverside County and they didn't stop until they gutted at least one church. They they would just move on to the next church. "
But Ackerman says scam victims urgently wrote D.A. Pacheco 3 years ago pleading for Duncan to be stopped and asks why Duncan could continue his $150 million dollar fraud after those early warnings.
"The bad guys spend a lot of money in those 3 years too while we were waiting to see something happen."
When asked if he thought it took too long for the DA to build their case, Ackerman responds, "We brought it to them a long time ago."
The D.A.s office states they began working with the FBI on an undercover operation against Duncan in 2007.
If convicted, Duncan faces up to a 97 year state prison sentence.
