They agreed to plead guilty next week in exchange for prison terms of less than 10 years, according to the U.S. Attorney's office. This is the second set of charges facing Boelens. He was convicted in January when he pleaded guilty in New York to charges of conspiracy and grand larceny of $29.5 million of Evergreen's assets. He is scheduled to be sentenced April 15.
Securities salesmen Thomas S. Spencer of Orlando and Anthony V. Micciche of Tampa, FL were also formally charged Wednesday. Spencer was charged with securities, mail and wire fraud; Micciche with selling unregistered securities. The bonds promised interest returns of 10% to 12% at a time when market returns were in the 5% range.
Boelens voluntarily placed Evergreen into Chapter 11 protection from creditors under the U.S. Bankruptcy Code in January 2001, listing liabilities of $214 million and assets of $3 million. That's when Evergreen's Ponzi scheme unfolded for the first time.
Court-appointed trustee R.W. "Bill" Cuthill Jr. expects to recover a total $12 million of missing Evergreen funds by fall and pay qualified creditors about $10 million after deductions for legal and administrative fees.
An undetermined number of creditors are not expected to ask for some of their money back because they were hiding the funds in the first place from the Internal Revenue Service and state tax agencies, according to testimony in the case. About 500 creditors have filed claims to date.
The bulk of the missing funds remain hidden in offshore banks such as the Surety Bank & Trust Co. of Nassau, operated periodically by other Evergreen principals, court records show.
The scam was operated for 10 years without detection from plainly furnished leased offices on Pine Street in Downtown Orlando. Criminal and civil court offices then were only a block away.
An unexpected reaction from the Orlando-based Evergreen investigation is the unwanted response the Boston-based Evergreen family of mutual funds is receiving from investors seeking more information on the probe.
The funds family is owned by Wachovia Corp. of Charlotte. The Boston mutual fund has no association with the Orlando Evergreen fund, authorities stress.
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