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01/25/2011

News / Monroe Man Pleads Guilty to Defrauding Investors

Stephen Sparks, 37, of Monroe, Michigan, a business partner of Global Points, pleaded guilty to federal fraud offenses, announced United States Attorney Barbara L. McQuade. In December 2010, Sparks was charged with wire fraud and money laundering.

McQuade was joined in the announcement by Erick Martinez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation, and FBI Special Agent in Charge Andrew Arena.

According to court records, during 2006 through 2009, Sparks took part in a scheme that solicited over $1 million from individual investors. Sparks represented to these investors that his business, Global Points, had an opportunity to purchase a warehouse full of Chinese electronic equipment and sell it in the United States at a substantial profit, returning over five times the amount invested. Sparks also represented that Global Point was in a position for a second had a second deal to acquire CD and DVD players that had been seized n Chicago, Illinois, and were being sold for the payment of back taxes. Sparks indicated that there would be a quick turn around and the profit would be twice the original investment.

Court records further showed that Sparks knowingly failed to inform the investors that he gave most of their money to his uncle, Barry Sparks, who had past criminal convictions for fraud. Sparks continued to provide excuses for the failure of the deals to close, and continued to solicit additional funds, claiming that the closings were imminent. Regarding the specific charges, in 2007, Sparks withdrew $12,000 in cash from his bank account knowing that these funds had been wired from Ohio to Michigan by an investor and, therefore, derived from the proceeds of wire fraud.

"Investment fraudsters prey on trusting investors by enticing them with a can't miss deal and then steal their hard earned money," said Special Agent in Charge Erick Martinez. "IRS Criminal Investigation is committed to investigating investment schemes in an effort to protect the financial well being of the American investor."

The case was investigated by special agents of the IRS Criminal Investigation and the FBI. It is being prosecuted by Assistant United States Attorney Ross I. MacKenzie.

http://detroit.fbi.gov/dojpressrel/pressrel11/de012511.htm

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