ABOVE + BELOW – Michael Liberty

https://bangordailynews.com/2019/02/27/news/state/michael-liberty-once-called-trump-with-a-maine-accent-faces-new-charges-for-alleged-scam/

Former Portland real estate developer Michael Liberty, 58, of Windermere, Florida, and Paul E. Hess, 63, of Braintree, Massachusetts, were indicted Wednesday by a federal grand jury in Portland for allegedly scamming investors out of $50 million to support their lavish lifestyles.

The criminal charges were lodged less than a year after the Securities and Exchange Commission sued Liberty and others for the same conduct.

The indictments charged each man with one count of conspiracy to commit wire fraud, four counts of wire fraud and one count of securities fraud. In addition, Liberty was charged with one count of conspiracy to commit money laundering and three counts of money laundering.

Beginning in 2010, Liberty and Hess solicited investments in Mozido, a privately held financial technology startup that offered users the ability to make payments using their mobile phones, the U.S attorney’s office said Wednesday.

Liberty and Hess allegedly raised millions of dollars from investors telling them, among other things, that their money would be used to fund Mozido’s business operations and that Hess was not being paid to raise the money. The indictment alleges that a substantial amount of the money did not go to Mozido, that a portion of the money was diverted to pay Liberty’s personal expenses, and that Hess received commissions and other payments in return for the money he raised from investors.

Liberty “adamantly denies the criminal charge” and looks forward “to
being exonerated of these allegations,” his attorney, Thimi Mina of Portland, said late Wednesday.

Mina called the prosecution “an unnecessary overreach by the federal government.” He said the pending civil action filed by the SEC was the “proper forum” for the allegations.

“Michael is greatly appreciative of the support he has received from his

family, friends and fellow Mozido investors,” Mina said. “While he awaits his day in court, Mr. Liberty will continue to work tirelessly to grow Mozido’s business.”

Hess’ Portland attorney, Bruce Merrill, did not immediately return a request for comment Wednesday. Hess is set to be arraigned March 6 in Portland. Liberty’s arraignment has not been set.

Liberty, who grew up in Gray, was released from federal prison in January 2018 after serving a sentence for making illegal contributions to the campaign of 2012 Republican presidential candidate Mitt Romney. In November 2016, Liberty waived indictment and pleaded guilty to illegally donating $22,500 to Romney’s campaign. He obscured his total donations by splitting the contributions up into nine parts over about two weeks in May 2011, and by making the gifts under the names of employees, family members and associates, according to court documents.

In August 2017, a federal judge sentenced the real estate, franchising and software mogul to pay a $100,000 fine and serve four months in prison followed by one year of supervised release.

If convicted on the new charges, Liberty and Hess face up to 20 years in prison and a fine of up to $250,000 or twice the gain to the defendant or loss to the victims, and a $5 million fine on the securities fraud charge.

Liberty faces up to 10 years in prison and a fine of the greater of $250,000 or twice the amount of criminally derived property involved in the transactions on the money laundering charges.

USA DOJ ANNOUNCEMENT: 2 Defendants Charged in Connection with Alleged Multimillion-Dollar Investment Fraud Scheme