Tuesday, Nov. 10, 2009

$82 million 3 Hebrew Boys fraud trial beginning

The 3 Hebrew Boys investment scheme goes to trial today, as opening arguments and testimony begin in the $82 million case.

The men were first arrested by state officials in 2007 for selling unregistered securities. They were indicted on federal charges a year later.

A summary of the criminal trial held in federal court in Columbia:

The accused: Joseph Brunson of Hopkins, Timothy McQueen of Blythewood and Tony Pough of Columbia

The charges: 35 federal counts of mail fraud and one count of conspiracy to commit mail fraud, punishable up to 20 years in prison if convicted

The accusations: The men are accused of leading groups - under the names 3 Hebrew Boys and Capital Consortium Group - to lure at least 7,000 investors with promises of daily returns of up to 500 percent, authorities said. Investors were recruited in two dozen states, mainly from military bases and churches.

Representatives of the groups told investors the money would go into foreign currency exchange markets. Instead, the groups' leaders are accused of investing less than $40,000 and going on shopping sprees, authorities said. Their purchases included a $5 million jet, homes and stadium luxury boxes, authorities said. About $18 million has been frozen from bank accounts tied to the groups and its leaders.

The defense: The trio said their work is faith-based and does not fall under securities laws. They also say in court filings that U.S. law does not apply to them since their ancestors inhabited what's now America before the European colonists arrived. The trio said in filings that since they have not damaged the plaintiff in the case, the United States of America, federal prosecutors have "failed in their duties" to protect the Constitution.

- Andrew Shain

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