Sacramento Accountant Sentenced to 19.5 Years in $13.5 Million Ponzi Scheme

SACRAMENTO, Calif., May 28 /PRNewswire-USNewswire/ -- William Murray, 56, of Sacramento, was sentenced today to 19.5 years in prison, followed by three years of supervised release for mail fraud and interference with tax administration in a Ponzi scheme, announced U.S. Attorney Benjamin B. Wagner.  U.S. District Judge Edward J Garcia also ordered Murray to pay restitution of $10,375,118.31 to victims of the scheme.

This case is the product of a joint investigation by the Treasury Inspector General for Tax Administration and Internal Revenue Service (IRS), Criminal Investigations.  Assistant U.S. Attorney Matthew D. Segal prosecuted the case.

According to Murray’s guilty plea on March 9, 2010, Murray stole approximately $13,357,133 from more than 50 clients between 2001 and 2009. He told clients to write checks to accounts under his control so that he could pay taxes or invest money on their behalf.  In fact, he spent millions of dollars in client money on his own lifestyle.  He bought himself houses, a classic car, a fleet of limousines, jewelry, rugs, fine wines and other luxury items.  Murray changed his clients’ addresses to his own, so that they would not receive the IRS’s demands for payment on their delinquent taxes.  As demands for payment arrived from clients and the IRS, Murray’s fraud became a Ponzi scheme. He used $3,507,502 in later clients’ money to pay off demands associated with earlier clients.

Prior to his arrest, Murray had been a person of some prominence.  He was a certified public accountant with hundreds of clients.  He regularly gave tax advice on a local television channel, and gave sworn expert witness testimony in courts in five counties.  He had served as an IRS Revenue Agent between 1976 and 1980.

Murray’s sentence provides for the forfeiture of all of his remaining property, the disclosure of his bank account information to his victims and a full disclosure of all of his financial affairs.

Ten victims spoke at the hearing, describing how Murray assured them that he would take care of their financial problems, saying, “Let me do what I do best.” Victims told how Murray had stolen their savings for college or retirement. Even while Murray’s clients were receiving care for serious and terminal illnesses, he would advise them to deposit even more money into his trust fund and then spend that money.

Judge Garcia said that the sentencing guidelines covered the victims’ sentiments. He said, “Victims’ lives have been changed forever and some will never recover due to their age,” noting that “the assets recovered will not begin to make the victims whole.”

“Mr. Murray intentionally jeopardized the financial well-being of his clients. He told them he would pay their taxes and invest their savings. Instead he spent millions on lavish gifts and a luxurious lifestyle,” said Scott O’Briant, Special Agent In Charge of the IRS Criminal Investigation. “IRS-CI will aggressively pursue those who take advantage of the hard working honest taxpayer.”

“As some of the victims indicated during the sentencing hearing today, crimes of this sort not only cause devastating financial harm, they also represent a profound betrayal of trust. The sentence imposed on Mr. Murray should stand as a warning to other professionals who handle their clients’ funds — those who take advantage of their positions to steal from their clients will face the full weight of federal criminal law,” said U.S. Attorney Wagner.

This law enforcement action is part of the work being done by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit StopFraud.gov.

SOURCE U.S. Department of Justice