Boulder Man, Mark Yost, Charged with Fraud, False Statements and Money Laundering

Source- http://denver.fbi.gov/dojpressrel/pressrel11/dn012611.htm

DENVER—Mark Yost, manager of Yost Partnership, L.P., based in Boulder, Colorado, was charged today by Information with fraud, false statements to banks and money laundering, the U.S. Attorney’s Office, the Federal Bureau of Investigation, the Internal Revenue Service – Criminal Investigation, and the Federal Deposit Insurance Corporation Office of Inspector General announced today. Yost appeared before a U.S. Magistrate Judge in U.S. District Court in Denver this afternoon, where he was advised of the charges pending against him, as well as the related penalties to those charges. He was also arraigned. At the conclusion of the hearing Yost was released on a personal recognizance bond. A change of plea hearing has been scheduled for February 3rd at 9:30 a.m., where Yost will be given an opportunity to plead guilty.

According to the Information filed today, Yost received investor funds to trade in securities and to make other investments. On February 4, 2005, and continuing thereafter to on or about July 6, 2010, Yost devised and intended to devise a scheme to defraud Yost Partnership and the limited partners by means of materially false and fraudulent pretenses. As part of the scheme, Yost, at the conclusion of each quarter of each year, beginning with the first quarter of 2005 and continuing through the second quarter of 2010, prepared account statements and caused them to be delivered to the limited partners, knowing each one of the statements to be false in that it overstated the value of the limited partner’s share of the assets of Yost Partnership. Yost failed to disclose to the limited partners that a certified public accountant had not completed an audit because the financial statements included inflated and improperly recorded values of the partnership’s interests in a privately held company and a publicly traded company. During the course of the scheme, Yost diverted money which he was not entitled to and converted those funds for his own use and benefit. He also made multiple false statements to banks and in reports.

The Information also alleges that from January 15, 2009 through July 7, 2010, Yost, the acting president of Flatirons Bank at the time, devised a scheme to defraud the bank and to obtain money by and under the control of the bank by means of materially false and fraudulent pretenses. Specifically, on two separate occasions, Yost caused Flatirons Bank to grant lines of credit to two individuals. The defendant ultimately converted those funds to his own use and benefit.

“Financial fraud, like this one have been all too common in recent years, and the U.S. Attorney’s Office is determined to fight them,” sais U.S. Attorney John Walsh. “In many cases investors are misled by unrealistic profit projections and impossibly high returns. This case is yet another reminder that thoroughly checking out an investment is crucial for all investors.”

“Everyday people entrust their hard earned money with banking and investment professionals,” said FBI Special Agent in Charge James Davis. “The FBI will aggressively investigate and pursue prosecution of financial professionals who breach this trust and misuse other people’s money for their own gain.”

“The IRS, along with our law enforcement partners, will pursue corporate officers who victimize their investors and violate the public trust,” said Sean Sowards, Special Agent in Charge, IRS Criminal Investigation, Denver Field Office.

Yost faces one count of wire fraud, four counts of false statements or reports to banks, one count of bank fraud, and one count of money laundering. If convicted, the defendant faces not more than 20 years’ imprisonment, and up to a $250,000 fine for wire fraud, not more than 30 years’ imprisonment, and up to a $1,000,000 fine for each false statements or reports to banks, not more than 30 years imprisonment, and up to a $1,000,000 fine for bank fraud, and not more than 20 years imprisonment, and up to a $500,000 fine (or twice the value of the property involved in the transaction) for money laundering.

This case was investigated by the Federal Bureau of Investigation (FBI), the Internal Revenue Service – Criminal Investigation (IRS CI), and the Federal Deposit Insurance Corporation Office of Inspector General (FDIC OIG).

The defendant has been charged by Information, which means he has waived his Constitutional right to be indicted by a federal grand jury.

The charges contained in the Information are only allegations, and the defendant is presumed innocent unless and until proven guilty.

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