Wednesday, Nov. 11, 2009

Prosecutor: Trio preyed on debt-ridden

COLUMBIA -- Three South Carolina men accused of bilking investors out of millions made anyone with ties to law enforcement or attorneys exit their seminars, and threatened investors with $1 million in fines if they told anyone about the massive returns they were making, a former bookkeeper testified Tuesday.

"If you are affiliated with any legal entities, would you please leave?" Somera Samuels said one of her bosses, Timothy McQueen, said at seminars he hosted with his two business partners.

The trio called themselves the "3 Hebrew Boys" after the biblical tale of brothers who survived an inferno because of their faith. They are on trial in federal court on nearly 60 federal charges, including mail fraud and money laundering, and face decades in prison and millions in fines if convicted.

Prosecutors say McQueen, Joseph Brunson and Tony Pough preyed on debt-plagued investors, luring church congregants and even U.S. soldiers serving overseas to invest a total of more than $80 million with their group. They promised daily returns up to 500 percent.

"These men have no financial training or background, but they claim to have figured out how to make all this money," Assistant U.S. Attorney Winston Holliday said.

The men with no business expertise promised to help clients get out of debt, telling clients their money would be invested in foreign currency markets.

But Samuels - the trio's only employee - said she never spoke with a foreign currency trader or saw any evidence money was being invested with one.

And prosecutors say the men kept millions for themselves, spending it on items like a Gulfstream jet, vacation homes and limousines.

Defense attorneys argued during their opening statements Tuesday that their clients didn't defraud anyone, saying they used the money to buy investment properties and pay out more than $30 million to their investors.