Lamar Adams pleads guilty to multi-state fraud scheme involving - MSNewsNow.com - Jackson, MS

Lamar Adams pleads guilty to multi-state fraud scheme involving over $100 million and hundreds of victims

Sketch of Lamar Adams in Court - Source: Bill Wilson Sketch of Lamar Adams in Court - Source: Bill Wilson
Sketch of Lamar Adams in Court - Source: Bill Wilson Sketch of Lamar Adams in Court - Source: Bill Wilson
Sketch of Lamar Adams in Court - Source: Bill Wilson Sketch of Lamar Adams in Court - Source: Bill Wilson
JACKSON, MS (Mississippi News Now) -

58-year-old Arthur Lamar Adams, of Jackson, pleaded guilty Wednesday before U.S. District Judge Carlton Reeves to one count of wire fraud for his role in a large, multi-state Ponzi scheme involving more than $100 million and hundreds of victims spanning a number of years.

READ MORE: Jackson man charged in multi million dollar fraud scheme

Restitution is mandatory under federal law and Adams has agreed to forfeiture of all funds and assets related to the Ponzi scheme.

“Those who prey upon and swindle people out of their hard-earned money, in some cases their life savings and retirements, will be firmly prosecuted by this office and face justice in our courts. This criminal conduct will not be tolerated in our state, and if others were involved, we will continue to dig until all those responsible have been brought to justice,” said U.S. Attorney Hurst. “Victims may contact the U.S. Attorney’s Office, and you can rest assured that we will do everything within our power to ensure victims are assisted, protected and afforded their rights.”

WATCH: Lamar Adams enters federal court Wednesday before pleading guilty in multi state fraud scheme

Over a period of at least seven years, Adams executed this sophisticated Ponzi scheme using Madison Timber Properties, LLC, a company wholly owned by Adams. From as early as 2011 through April 2018, Adams’s scheme defrauded investors by soliciting millions of dollars of funds under false pretenses, failing to use the investors’ funds as promised, and converting investors’ funds to Adams’s own benefit without the knowledge of the investors.

Instead of investing his clients’ money, Adams used the invested funds for his own personal benefit and for purposes other than those represented to investors, which also included making payments due and owing to other investors, thus perpetuating the Ponzi scheme. During the fraudulent scheme, Adams fraudulently obtained well in excess of $100 million from more than 250 investors located in at least 14 different states.

As part of his fraudulent scheme, Adams falsely represented to investors that Madison Timber Properties was in the business of buying timber rights from landowners and then selling the timber rights to lumber mills at a higher price. The object of the scheme was to cause individuals to invest in loans that purportedly were for the purpose of financing contracts for the purchase of timber rights to be sold to lumber mills at a higher price. However, neither Adams nor Madison Timber Properties had such timber rights or contracts with lumber mills, except in only a few instances.

Adams entered into fraudulent investment contracts with investors, most often in the form of promissory notes on behalf of Madison Timber Properties. The loans typically guaranteed investors an interest rate of 12-13 percent, with the interest to be repaid to investors over the course of 12-13 months. The monthly payments due on these promissory notes were typically due on either the first or the fifteenth of the month.

Adams created false documents causing investors to believe that their investments were secured by sufficient collateral from which they could recover all or part of their investment in the event that Madison Timber Properties defaulted on the loans. Specifically, Adams created false timber deeds purporting to be contracts conveying timber rights from landowners to Madison Timber Properties. Adams forged the signatures of landowners and also created false timber deeds purporting to convey timber rights from Madison Timber Properties to the investors.

Craig Endris anxiously sat through Wednesday's hearing as he learned more about the scope of Adams' ponzi scheme.

Endris said his parents are victims in this case.

"I met a friend of his that works with him and he told me about the business and he go my parents involved in it," Endris said. "It was a good deal. They were buying timber, at least we thought they were and we were investing in the timber business."

Endris said everything appeared to be going well for his family until recently. 

"A couple of weeks ago everybody said they were looking for Lamar," Endris said. "A friend of my dad's tolf my dad his check wasn't any good."

Endris did not disclose exactly how much money his family lost but said he felt his parents were preyed on.

"My dad is 85 years old," Endris said. "I feel like Lamar and his company is taking advantage of a vulnerable adult. It was everything they had. We sold our farm in Canton and my mom and dad moved to deerfield."

Adams will be sentenced by Judge Reeves on August 21, 2018, at 9:30 a.m., and faces a maximum penalty of 20 years in federal prison and a $250,000 fine.

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