The lure of quick money – $1 million in just 30 days – was enough to attract investors from Germany, Britain and the Bahamas.
It was a promise, they later learned, that would turn them into victims.
Michael K. Martin, one of the men accused of bilking the investors, was arraigned Monday in Buffalo federal court on 34 charges of wire fraud. He entered a plea of not guilty.
Martin, 57, of Virginia Beach, Va., is accused of conspiring with others as part of a bank account scheme that promised $1 million in 30 days to investors who made $100,0000 deposits into an escrow account.
In reality, according to the FBI, the deposits were pocketed by Martin, Christopher Venti and others involved in the conspiracy. Venti, 47, of Hamburg, pleaded guilty to wire fraud and tax evasion last year.
Martin, who waived his court appearance Monday, was initially charged with defrauding one investor.
"There are now an additional five victims," Assistant U.S. Attorney MaryEllen Kresse said Monday.
Martin's arraignment before U.S. Magistrate Judge H. Kenneth Schroeder Jr. came just a year after Venti took a plea deal in which he admitted enticing investors with false promises of high-yield returns and then pocketing much of the money they gave him.
All told, Venti’s clients, many of them large institutional investors, lost more than $7 million.
In Venti's plea agreement, Kresse outlined the various schemes he used over the years and how he, on at least four occasions, stole investor funds and used them to pay personal expenses, including the mortgage on his Holiday Lane home.
Venti also admitted withdrawing $148,000 in investor funds while at three local casinos.
As part of its investigation, the government relied on an undercover FBI employee who posed as an investor and recorded two telephone conversations with the defendant.