David Saks: International Con Man Sentenced - Scammed Investors and Dodged Taxes

David Saks - Real Estate Broker - The Real Estate Mart of Tennessee, Inc. - 4040 North Watkins-Suite #4 - Memphis, Tennessee 38127 - Phone (901) 357-4663

International Con Man Sentenced - Scammed Investors and Dodged Taxes

International Con Man Sentenced for Scamming

Investors and Dodging Taxes

U.S. Attorney’s Office August 21, 2014
  • Southern District of California (619) 557-5610

Svein Erik Ulsteen,

a former executive and shareholder of Anturion Limited, a company formed in the Channel Islands, was sentenced today to 46 months in custody for bilking investors of more than $2 million by selling them counterfeit and forged Anturion securities. Ulsteen used the investor funds to pay for his personal entertainment and living expenses—such as yacht and BMW payments—rather than to operate Anturion. Ulsteen was also sentenced in a separate case with corruptly preventing the Internal Revenue Service from determining his true tax liability, and attempting to cheat the IRS out of almost $400,000 in lawfully owed taxes. Ulsteen has been in custody since December 16, 2013, when he attempted to board a plane leaving for his home country of Norway. United States District Judge M. James Lorenz rejected Ulsteen’s request to be released from custody today, commenting that Ulsteen’s sole motivation to commit his crimes was to benefit himself, and “there are too many victims out there that have lost everything because of your greed. Now it’s time to make the defrauded public whole.” District Judge Lorenz also rejected Ulsteen’s attempt to characterize himself as a credible businessman, and instead commented, “You’re just a con man.”

According to court records and admissions by Ulsteen, between October 2011 and June 2013 Ulsteen solicited investors by pretending to either: (1) sell them shares of Anturion stock; or (2) borrow money on behalf of Anturion, which would be paid back with interest. In fact, however, Ulsteen was neither authorized to sell company stock nor borrow money on its behalf. To support his deceptive solicitations, Ulsteen created fake “subscription agreements” and phony “loan” documents that purported to be authentic securities of Anturion. Using these counterfeit securities, Ulsteen convinced investors throughout the United States to send more than $2 million to Ulsteen’s nominee accounts.

Personal Luxury Expenditures

Ulsteen admitted that instead of transferring these investments and loans to Anturion, he took the money for himself. For example, from a $300,000 loan one victim thought was going to Anturion, Ulsteen spent over $8,500 on his 82-foot yacht moored in Florida, over $42,000 paying personal credit card expenses, $5,000 in payments to his then-spouse, more than $4,600 in BMW car payments, over $66,650 in insurance premiums, as well as numerous other personal expenditures such as cell phone service, health care premiums and on-line dating services.

Investors Received Nothing, or Worthless Shares

Multiple investors who thought they were purchasing stock in Anturion received nothing. Other investors eventually received shares, but by that time the price of Anturion stock had dramatically declined. This stock came from Ulsteen’s own personal holdings (and not directly from the company as Ulsteen had promised) and could not be sold through any investment firm in the United States. Indeed, trading in Anturion is presently suspended on London’s ISDX Growth Market, so there is no way to reliably value any of the shares Ulsteen eventually provided to his victims. And those individual victims who thought they were loaning money to Anturion were never repaid as promised.

Tax Evasion

In addition to selling forged securities, Ulsteen admitted to corruptly obstructing the IRS’s attempts to assess his true tax liability. Between 2010 and 2012, Ulsteen earned over $1 million from various activities, including the sale of his Anturion stock. Although the IRS notified Ulsteen that he needed to file federal income tax returns as he owed taxes, penalties and interest, Ulsteen refused to file for any of these years, and took several steps to prevent the IRS from learning how much income he had earned. These steps included depositing investor funds into the nominee accounts he controlled and paying his personal expenses out of these company accounts.

Ulsteen was ordered to return to court on December 11, 2014, for a hearing to determine how much restitution he owes to his victims.

Today’s sentencing was announced by United States Attorney for the Southern District of California Laura E. Duffy, who commended and thanked her colleague Benjamin B. Wagner, the United States Attorney for the Eastern District of California, for his Office’s excellent work on the case before Ulsteen’s arrest in San Diego late last year. That arrest and the prompt conviction of these fraud and tax charges was the result of coordinated investigations by the San Francisco and San Diego Divisions of the Federal Bureau of Investigation, and the San Diego Division of the Internal Revenue Service, Criminal Investigation.

Defendant

  • Svein Erik Ulsteen
  • Age: 50
  • San Diego, CA

Criminal Case Nos. 14CR0923-L (S.D. Cal.), 14CR0924-L (S.D. Cal.), and 3:14-CR-0067-WHA (N.D. Cal.)

Summary of Charges

  • Counterfeit and Forged Securities, in violation of 18 U.S.C. § 513. Maximum Penalties: 10 years’ imprisonment, $250,000 fine or twice the pecuniary gain or loss resulting from the offense, $100 special assessment, restitution.
  • Obstruction of Internal Revenue Laws, in violation of 26 U.S.C. § 7212(a). Maximum Penalties: three years’ imprisonment, $250,000 fine or twice the pecuniary gain or loss resulting from the offense, $100 special assessment, restitution.

Agencies

  • Federal Bureau of Investigation—San Francisco Division and San Diego Division
  • Internal Revenue Service, Criminal Investigation
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David Saks



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Comment balloon 3 commentsDavid Saks • August 22 2014 09:25AM

Comments

 

Don't forget to review this week's real estate fraud cases.

Posted by David Saks ((retired)) over 5 years ago

David, just about everyone operating businesses out of the Channel Islands is suspect.  It is a place made for evading taxes.

Posted by Gabe Sanders, Stuart Florida Real Estate (Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales) over 5 years ago

$2 million's quite a swindle. Lot's of people got hurt. Hope the guy does every second of his time, Gabe.

 

 

Posted by David Saks ((retired)) over 5 years ago

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