It’s been just over a year since, in February 2010, our sister site Magnolia Voice first reported that a Magnolia couple had been charged with running a ponzi scheme, raising over $3 million from investors in Queen Anne and Magnolia and participating in fraudulent business practices.
On Friday, April 1 defendant James Liddell was sentenced to 57 months in prison, three years of supervised release, and $1,175,518 in restitution for wire fraud by the U.S. District Court in Seattle. Liddell, 57, was indicted by a federal grand jury in April 2010 and turned himself in to authorities, pleading guilty to the charges in June 2010. From our sister site Magnolia Voice:
Between 2003 and 2009, Liddell claimed his business was rehabilitating point of sale machines and selling them to a large area drug store chain. Liddell represented to the investors that they would “own a series of contracts” with the machine purchasers. Liddell provided promissory notes to investors outlining high rates of interest on the loans and promising investors would receive up to 50% of the profits from the sales of the machines. However, no machines were ever bought or sold to the Seattle retailer, and there were no contracts for any such sales. Some of the money was used to pay “returns” to earlier investors, but Liddell used $1.2 million for his own benefit.
Prosecutors say Liddell “stole over a million dollars from victims whom he conned into believing he was a friend and experienced business person who could be trusted with their money. Mr. Liddell met many of his victims through contacts in his neighborhood and through school connections with his children. He preyed on his victims by gaining their respect as a friend and neighbor prior to soliciting loans for a business he knew was a total sham. In order to further his scheme, he repeatedly fabricated documents and provided bogus reasons to explain away bounced checks and missed payment deadlines until he found a new victim to supply him with funds needed to pay off his last victim. As a result of his fraud, several victims are facing severe financial hardship including the possibility of bankruptcy.”
Liddell’s wife, Leslie Collins, who was originally implicated in the case last year, was not charged with anything. Liddell wrote a letter to authorities that stated that the two were going through a divorce at the time and that Collins had no idea about his financial activities.
Read the full story at Magnolia Voice.