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Man charged in $8 million scam returns from Vietnam

Michael H. Wilson raised a few eyebrows when he arrived in town and bought a $6.3 million home in Hamburg in 2008.

Only 22 at the time, Wilson had a reputation as a savvy, young investor from Cleveland.

On Friday, he returned to Buffalo but, this time, as a criminal defendant accused of operating an $8 million investment scam.

Wilson, who has been on the run, was recently discovered and arrested in Vietnam and extradited back to Buffalo. His arraignment Friday before U.S. Magistrate Judge Jeremiah J. McCarthy was his first courtroom appearance since being charged in a 47-count indictment six years ago.

"As this case shows, we will pursue individuals to the extent we need to," said Adam S. Cohen, special agent in charge of the FBI in Buffalo.

Wilson said little during his appearance but pleaded not guilty to the charges against him. FBI agents were joined in the courtroom by the two Vietnamese law enforcement officials who escorted Wilson back to the U.S.

From Day One, Wilson was viewed by the FBI as the ring leader of a scheme that offered high returns on complex investments and targeted wealthy, sophisticated investors.

Investigators say it wasn’t uncommon for Wilson’s clients to pony up as much as $250,000 apiece as part of their initial investments. But Wilson never invested that money.

Instead, he used it to buy his luxury home on Boston State Road in Hamburg, investigators say. At the time, it was the most expensive home ever purchased in Erie County.

Viewed by prosecutors as a flight risk, Wilson was ordered held without bail Friday. He will appear in court again next week for a detention hearing.

"The defendant has already fled twice," Assistant U.S. Attorney Scott S. Allen Jr. told McCarthy. "He has proven to be a flight risk."

As part of his scheme, Wilson is accused of using proceeds from his scheme to buy valuable art work and several luxury vehicles, including a Hummer, Corvette and Mercedes-Benz.

The vehicles and 126-acre estate, which in addition to two houses includes ponds and wooded areas, were later taken from him.

A federal judge also ordered the forfeiture of seven flat-screen televisions and 15 paintings and sculptures. They included two works by renowned artists Frank DiVita and Michael Flohr valued at $23,000.

The forfeiture followed Wilson’s indictment on 47 counts of fraud, conspiracy and money laundering. At the heart of the prosecution is the allegation that he ran an investment firm that bilked investors out of $8 million over a two-year period.

"I think the indictment speaks volumes about what he was involved in," Cohen said Friday.

The first evidence of the FBI’s interest in Wilson came in July 2009 when agents searched his Hamburg home. By the time he was indicted a year later, disgruntled investors were coming forward and pointing fingers at Wilson.

One Texas businessman called him a “junior Madoff.”

Wilson's return to Buffalo is the latest development in a case that already has resulted in two convictions.

Daniel Rice, a retired Boston, Mass., police detective, pleaded guilty to wire fraud in connection with Wilson’s investment scheme. Rice admitted inducing a broker to invest $100,000 with “George Possiodis,” an alias investigators say Wilson often used when dealing with investors.

Rice, in his plea deal, said he kept about $40,000 of the $100,000 for himself and gave the balance to Wilson.

In 2013, Wilson’s brother William also admitted to playing a minor role in the scheme. He pleaded guilty to a misdemeanor charge and admitted helping his brother commit one of the crimes he is accused of.

The two convictions are the result of an investigation by the FBI and the Internal Revenue Service’s Criminal Investigation Division.

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