CONCORD - A York man pleaded guilty in federal court on Friday to participating in an investment fraud scheme that bilked Granite State investors of more than $4.2 million.
William Bischoff, 76, of York, Maine, also admitted he failed to file federal income tax returns.
According to court documents and statements made in court, from 2009 through September 2017, Bischoff defrauded more than two dozen clients of his financial advisory business by falsely promising to invest their money in real estate, structured legal settlements, high yield notes, and a start-up recycling business. He further guaranteed returns that far exceeded market norms. Bischoff sent many solicitations to the victims of the fraud scheme by e-mail, while running his Portsmouth investment company.
To conceal that conduct, Bischoff used money he received from some victim investors to make payments to other victim investors. He also provided monthly account statements to the victim investors that falsely represented the balance of their fictitious investment accounts.
A Ponzi scheme is a form of fraud in which belief in the success of a nonexistent enterprise is fostered by the payment of quick returns to the first investors from money invested by later investors.
Bischoff also admitted in court documents that he failed to file individual federal tax returns for from 2011 to 2015, which resulted in a $568,845 tax revenue loss to the U.S. Treasury.
Bischoff pleaded guilty to one count of wire fraud and one count of willfully failing to file federal tax returns. He will be sentenced on June 20.
United States Attorney Scott W. Murray said Bischoff's violation of client trust was a reprehensible act, especially as a fiduciary counsel.
"Mr. Bischoff manipulated and misled his victims, depriving them of millions of hard-earned dollars," he said. "The U.S. Attorney's Office is committed to working closely with our law enforcement partners to identify those who commit such schemes and to seek justice for the victims of white collar crimes."
Harold H. Shaw, Special Agent in Charge of the FBI Boston Division, added, "Mr. Bischoff is finally taking responsibility for defrauding his clients out of millions of dollars. Through a web of lies and deceit, Mr. Bischoff betrayed their trust and used their money to line his own pockets and prop up his failed investments,"
Director of the New Hampshire Bureau of Securities Regulation Jeffrey Spill said that timely prosecution of the probe helped lessen the damage, "When the fraud was uncovered, the agencies acted quickly to shut the scheme down which prevented further losses," he said.
The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigation Division, and the New Hampshire Bureau of Securities Regulation. Assistant United States Attorneys William Morse and Robert Kinsella prosecuted the case.