Earlier this month Jamie Campany, owner of three invesment firms specializing in alleged metal purchases, was sentenced to 151 months in prison on multiple counts of mail and wire fraud.
According to the Information filed in the case and statements made in court during the plea and sentencing, Campany was the owner of three investment firms specializing in purported gold, silver, platinum, and palladium bullion purchases on behalf of individual clients. Among his companies were Global Bullion Exchange, LLC (“Global”) and various affiliated licensee businesses throughout Palm Beach, Broward and Miami-Dade counties in Florida and other locations outside of Florida. In addition to Global, Campany owned and operated two predecessor firms, Barclay Trading Group, Inc. (“Barclay”) and The Bullion Group, Inc., both with offices in West Palm Beach.
Campany’s three businesses conducted a sophisticated telemarketing operation to solicit investors to purchase precious metal bullion using purported “leverage” financing. These same investors were led to believe that they would need only to provide a fraction of the total cost of the purchased metals, with the remainder of the purchase price to be covered by margin-type financing, which would purportedly be extended to the investor by a purported “clearing firm.”
As further detailed in court records, the purported “clearing firm” with which Barclay had initially associated, began delaying and ultimately ignoring requests by Barclay’s customers to sell their precious metals investments. As a result, the unsatisfied clients began to complain and threatened Barclay with litigation. In addition, the clearing firm’s failure to sell the clients’ holdings left Barclay insolvent.
In an attempt to prevent further complaints, litigation, and possible governmental enforcement action, Barclay began to satisfy its clients’ requests for liquidation of their investments by making payments to these clients using funds it had received from newer investors.
After Global succeeded Barclay, Global continued this same Ponzi strategy. Global used Diversified Investment Group, Inc. (“Diversified”), a shell company, as its “clearing firm.” In fact, however, no bullion was purchased, even though clients paid substantial commissions and fees totaling approximately 18% of the total purported value of the metal allegedly purchased.
Campany also misrepresented to the inventors that their holdings had been financed through so-called “margin” credit. Thus, the investors were charged substantial interest on these non-existent “loans” and were subjected to periodic false “margin calls” during market declines. Moreover, investors who could not comply with such “margin calls” were informed that their investment positions had been forcibly liquidated and taken by Diversified as a secured creditor.
In a recent litigation filed in Miami-Dade Circuit Court by a court-appointed assignee, it is estimated that more than 1,400 investors were defrauded by Campany’s scheme out of more than $29.5 million – Source.
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