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Co-Conspirators Sentenced in $213 Million Ponzi Scheme
Failed Banks: Summary of Action: On December 2, 2010, Toni Jo Wilder and Gary Wilder (Wilders), owners of Wildwood Industries, were sentenced to 15 years (184 months) and seven years (84 months) respectively for their role in a $213 million fraud scheme that defrauded lenders to fund manufacturing equipment that did not exist. U.S. District Judge Michael M. Mihm also ordered the couple to pay $172 million in restitution to victims of the fraud scheme; to 85 financial institutions including the above listed failed banks and FDIC regulated banks. The Wilders previously pled guilty to an Information charging them with Title 18, United States Code, Section 1344, Bank Fraud, Title 18, and Title 18, United States Code, Section 1956 (h), Money Laundering. Mr. and Mrs. Wilder orchestrated a $213 Million equipment leasing Ponzi scheme. Nature of scheme: Gary K. Wilder and Toni Jo Wilder, owners of Wildwood Industries (Wildwood) in Bloomington, Illinois, and his employees conspired with an equipment manufacturer, William Stephen Hudson, dba W.S. Hudson Converting, Inc. to commit bank fraud. Wildwood borrowed at least $213 million from numerous lending institutions for equipment, which was already used as collateral for numerous other loans. Wildwood was a company that manufactured lawn bags and vacuum bags. Wildwood had a large facility in Bloomington which contained assorted manufacturing equipment. Hudson Converting, at one time, was one of the manufacturers of the machinery used by Wildwood. Hudson provided Wilder with falsified invoices purporting the purchase of machines to be used at Wildwood. Hudson included the falsified serial numbers on the invoices he created for Wider. Hudson wired the proceeds of the equipment leases to Wilder once the lease was funded by the lender. In Ponzi-scheme-like fashion, Wilder used the revenue from his fraud to make the lease payments for other fraudulently obtained equipment leases which used the same equipment as collateral. Wilder continued to fool lenders by using new invoices with different serial numbers for the same equipment. Previously, Doyle F. Fry (Accountant), Dominick F. Propersi (Operations Manager), Kimberly J. Hill (Bookkeeper), and William S. Hudson each plead guilty to separate Informations charging each with Title 18, United States Code, Section 371, conspiracy and are scheduled to be sentenced December 9, 2010 (Propersi, Fry and Hill) and March 17, 2011 (Hudson). On March 5, 2009, a group of Wildwood's creditors petitioned for Chapter 11 involuntary bankruptcy against Wildwood Industries. On May 20, 2009, Wildwood Industries' assets were sold for approximately $2 million. Lease records indicate there was an intended loss in excess of $245 million Source: United States Attorney's Office, Central District of Illinois. Responsible Agencies: Joint investigation by the FDIC OIG, United States Postal Inspection Service, Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation. The case was prosecuted by the United States Attorney's Office, Central District of Illinois. For further information, contact Special Agent in Charge Nancy Grinnell at (312) 382-7513. ## |