UPDATED Atlanta Currency Exchange Executives Indicted in 'Pumping' Scheme

by **Ssmith** Wed Feb 24, 2016 9:31 am

UPDATED

Atlanta Currency Exchange Executives Indicted in 'Pumping' Scheme

R. Robin McDonald, Daily Report
February 23, 2016

UPDATED Atlanta Currency Exchange Executives Indicted in 'Pumping' Scheme International-Currencies-Article-201602231211

UPDATED Atlanta Currency Exchange Executives Indicted in 'Pumping' Scheme International-Currencies-Article-201602231211

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A federal grand jury has indicted three executive officers of an Atlanta currency exchange firm that at one time was one of the nation's largest sellers and exchangers of Iraqi currency, the U.S. attorney in Atlanta announced Monday.

Tyson Rhame, 51, and James Shaw, 53—co-owners of the Sterling Currency Group—and company COO Frank Bell, 54, were indicted on multiple charges of conspiracy, mail fraud and wire fraud. Rhame and Shaw were also charged with multiple counts of money-laundering.

The indictment also charges Terrence Keller, a 55-year-old Internet promoter, with multiple counts of fraud. Federal prosecutors say Sterling paid Keller to illegally "pump" sales of the Iraqi dinar.

A Kentucky resident also known as TerryK, Keller ran an Internet website and chat room known as "The GET Team" that he used—along with weekly conference calls with potential investors—to promote investments in the Iraqi currency, often with a Sterling representative joining, prosecutors said.
Federal authorities have already seized and are seeking the forfeiture of the defendants' assets, including: millions of dollars held in dozens of financial accounts; millions in foreign currencies; three private airplanes; two Mercedes and an Audi Quatro; real estate in Brookhaven, Atlanta, Panama City Beach, Florida, and Charlotte, North Carolina; and 48 trusts, capital investment groups and limited liability companies in which the defendants had invested.

Sterling Currency Group, a limited liability company, also did business as Sterling Online Processing Services LLC, and Dinar Banker Sterling sold and exchanged so-called "exotic currencies," including most predominantly the Iraqi dinar.

Sterling Currency said in a news release that since federal authorities obtained search warrants and filed a civil forfeiture complaint as part of the investigation of Sterling Currency and what it labeled "the Iraqi dinar industry," Sterling has provided evidence to the U.S. attorney that it believes "demonstrated … that the central fact allegations in the civil forfeiture complaint were inaccurate, and in some instances flatly false." But, the release said, the U.S. attorney secured a criminal indictment anyway.

"From Sterling's perspective, these charges are without any merit. Sterling, a lawful business which sold a lawful product, was owned and operated by law-abiding and conscientious individuals, two of whom served extensively in the United States Armed Forces," the release said. "These executives worked hard to ensure Sterling complied with all state and federal laws and regulations. This included investing enormous resources into its compliance program and maintaining extensive legal and other professional counsel to ensure it was fully compliant with all applicable laws. Sterling and the named individuals strongly deny the U.S. attorney's charges and look forward to vigorously defending themselves throughout this process and at trial."

Mike Brown of Alston & Bird, Rhame's criminal defense attorney, told the Daily Report on Tuesday, "We look forward to defending Mr. Rhame and are confident that when the facts come out there will be a conclusion that he committed no crime."

Don Samuel of Garland, Samuel & Loeb, who is defending Shaw, referred the Daily Report to Sterling's statement.

Aaron Danzig of Arnall Golden Gregory, who is defending Bell, said he is "confident that when the facts come out, people will conclude that Mr. Bell hasn't committed any crime."

According to the indictment, a key component of what federal authorities say was the illegal pumping scheme was Keller, who made "materially false" statements to followers of his website that he had information verified by "high-level confidential sources" in the U.S. government, the Iraqi government, major financial institutions and other international organizations. He also told followers that he had no financial motive to promote investments in the dinar but was rather an altruist who shared his knowledge so that others might benefit.

Prosecutors said Keller fueled financial speculation by predicting an imminent "revaluation" of the dinar that would lead to a quick, exponential rise in value over U.S. dollars and other stable foreign currencies. Holders of dinars would realize potentially enormous gains if a revaluation occurred. And the participation of Sterling's executives on Keller's conference calls and chat forums provided validation to Keller's followers that his claims about a revaluation of the dinar were credible, according to the indictment. Keller and his GET Team, prosecutors said, was one of the leading Internet-based proponents of speculation on a dinar revaluation.

Sterling executives didn't make direct representations about the likelihood of a revaluation or offer investment advice to Keller's followers, but the indictment said that Sterling executives "assured listeners" on Keller's conference calls that Sterling was prepared and able to handle the high volume of dinar exchanges that would likely occur once the Iraqi currency was revaluated.

Prosecutors said Keller had a secret financial arrangement with Rhame, Shaw, and Bell and was paid more than $160,000 to fuel speculation in currency sales, particularly the dinar. Keller's promotional activities generated millions of dollars in sales for Sterling Currency, which sold the dinar and other "exotic currencies" as Sterling Online Processing Services and Dinar Banker, prosecutors said.

The indictment also contends that Rhame, Shaw and Bell never believed that Keller had the high-level sources he claimed to have and warned their own employees not to speculate. But, the indictment said, Sterling executives also knew that Keller's alleged pumping activities were essential to their company's financial success and would continue to boost their sales. The dinar has not yet been revalued.

Rhame is alleged to have told colleagues that Keller and his GET Team had generated as much as 80 percent of Sterling's business and was Sterling's single largest referrer, prosecutors added. From 2010 to 2015, prosecutors said that Sterling grossed over $600 million in revenue in currency sales and generated over $180 million in distributions for the company co-owners.

"Investors in the Iraqi dinar, like all investors, are entitled to make an informed choice based on honest and transparent information," U.S. Attorney John Horn in announcing the indictment. "These defendants are alleged to have defrauded investors by spreading misinformation about the investment potential of the Iraqi dinar in order to profit from sale of the currency."

Said Veronica Hyuman-Pillot, special agent in charge of the IRS criminal investigation division in Atlanta: "Investment fraud schemes are designed to appeal to people's hope, often resulting in the total loss of their investment. Individuals who line their pockets with money gained through deceiving others should know they will not go undetected and will be held accountable.'

Read more: http://www.dailyreportonline.com/id=1202750405579/Atlanta-Currency-Exchange-Executives-Indicted-in-Pumping-Scheme#ixzz415zqixus