Second figure in national Ponzi scam pleads guilty
The Dunedin man follows another of the six men indicted in the scam based in Clearwater that took millions from unsuspecting investors.
By KATHERINE K. LEE
Published October 30, 2004
A Dunedin man pleaded guilty Thursday to one count of securities fraud and one count of money laundering in a Ponzi scheme authorities say scammed investors of $18.4-million.
Danny Lee Wey, 56, faces up to five years in prison and three years probation on the count of securities fraud, the sale of unregistered securities and mail fraud.
The second count of money laundering carries a maximum sentence of 10 years imprisonment and three years probation.
Each count also carries a potential fine of $250,000 or twice the amount of the money taken in the scheme, according to the U.S. Attorney's Office in Tampa.
Wey and six other men were indicted by a federal grand jury in Tampa in December 2000 in what federal investigators said was an $18.4-million national investment scam based in Clearwater. Wey could not be reached for comment Friday.
A sentencing hearing for Wey has not been set. He had been charged with a total of 38 counts of securities fraud and conspiracy to commit mail fraud. The U.S. Attorney's office is likely to make a motion to dismiss the 36 other counts as part of his plea agreement.
Federal authorities charged that Wey, along with co-defendant Gregory G. Schultz, 54, of Clearwater, were the main organizers of a Ponzi scheme in which unregistered securities were sold from late 1996 to August 2000. In a Ponzi scheme, money from new investors is used to make payments to earlier investors until the whole deal collapses.
The companies through which the securities were sold include Millennium, the Stonehenge Group, First Dominion Venture Capital, Global Research International, Impact Marketing, West Coast Distributors, Innovative Financial Concepts, Investor Business Journal, Delta Financial Services, Envision International and The IR Firm.
The Florida Comptroller's Office shut down the offices of Millennium and Stonehenge in Clearwater and Oldsmar in 1999, charging that the companies and their affiliates had illegally sold promissory notes and preferred stock to more than 100 investors, mostly in Florida.
A court-appointed receiver took control of the companies' assets and froze bank accounts belonging to some of those charged in the indictment.
Those indicted along with Schultz and Wey were Joseph Cuciniello, 54, Oldsmar; Anthony Cuciniello Jr., 59, Odessa; Dean Sinibaldi, 43, Fort Myers; Robert Phillips, 53, Palmetto; and Gene Tyrrell, 53, Glendale, Ariz.
The U.S. Attorney's office in Tampa said Friday that Phillips pleaded guilty to one count of securities fraud on Oct. 20, and at least one of the other defendants also has entered into a plea agreement. A criminal trial for the remaining defendants is set for Feb. 7.
