After a two-day trial in District Court on St. Thomas, a federal jury found Janice Rey guilty of 56 counts of conspiracy, wire fraud, federal money laundering offenses and tax evasion, according to the U.S Attorney’s Office for the Virgin Islands.
Rey was found guilty of one count of conspiracy, eight counts of wire fraud, 43 counts of money laundering and four counts of tax evasion.
The charges and convictions stem from evidence that Rey and co-conspirator Devon McLean set up a Ponzi scheme that operated out of a storefront in St. Thomas, from which they bilked some 50 investors out of more than $5.5 million.
McLean pled guilty to federal wire fraud as part of a plea agreement entered March 5, and agreed to continue to cooperate with prosecutors in exchange for consideration at sentencing.
According to the indictment, Rey was chief executive officer and McLean chief financial officer of a company they set up in Nevada called Paramount Group. They then set up a storefront on St. Thomas where they solicited investors.
The two told investors Paramount is part of the massive multinational Halliburton company, and because of this claimed relationship, it could generate large returns on investment and investors would double their money in less than a year. They claimed then-Vice President Dick Cheney, who at one time was chairman and CEO of Halliburton, was associated with the group, and that it was making an array of investments overseas.
From 2005 through 2009, the two took hundreds of thousand of dollars in investor funds and distributed them to several bank accounts. Many of the transactions were laundered through "Junor Company," an art gallery in Decatur, Ga., owned by McLean.
McLean testified against Rey in his plea agreement, saying he "conspired with his co-defendant to operate a ‘Ponzi’ investment scheme" from 2005-2009, "defrauding people of over $5.5 million."
McLean confessed he and Rey "perpetrated the scheme by setting up bogus businesses and enticing people to invest with these businesses by promising them huge returns on their investment. Instead of actually investing the money obtained, the defendant and his co-defendant instead used the newly gained funds to pay earlier investors and for personal gain."
Rey went to trial April 1 and was convicted by a jury. She faces up to 20 years in prison and potential fines of up to $3.1 million. The statutory penalty for tax evasion under local law is a fine of not more than $10,000 or imprisonment not more than 5 years, or both, according to the U.S. Attorney’s office.
