United States Attorney
Southern District of New York
OCTOBER 18, 2010 ELLEN DAVIS,
Ponzi Scheme Involved Fraudulent Investments In ATM Machines
PREET BHARARA, United States Attorney for the Southern
District of New York, announced that VANCE MOORE II pled guilty
today in Manhattan federal court to nine counts of wire fraud and
one count of conspiracy to commit wire fraud for his role in an
$80 million Ponzi scheme involving fraudulent investments in
Automated Teller Machines (“ATMs”). MOORE pled guilty before
U.S. District Judge THOMAS P. GRIESA.
According to the Indictment, statements made during
various proceedings in this case, and statements made during
today’s guilty plea:
From 2005 through January 2008, MOORE and his codefendant,
WALTER NETSCHI, solicited over $80 million worth of
investments in ATMs purportedly placed in various retail
locations around the country, including convenience stores, gas
stations, malls, and hotels. MOORE and NETSCHI claimed that the
ATMs would generate revenue streams for the victims based on fees
charged for withdrawals of cash. In reality, MOORE and NETSCHI
did not use the victims’ funds to purchase ATMs, but rather used
the money to further the fraudulent scheme and to enrich
MOORE and NETSCHI entered into contracts with victims
falsely representing that the victims collectively had purchased
over 4,000 ATMs. In fact, approximately 90 percent of the
machines sold to the victims either did not exist or were never
owned by MOORE or NETSCHI. To further the fraudulent scheme,
MOORE transmitted monthly reports and monthly payments to the
victims relating to their investments in the ATMs. The reports
actually contained false information and the payments were not
revenues from ATMs, but were simply monies received by NETSCHI
from new investors.
MOORE made additional misrepresentations to victims who
noticed discrepancies in the monthly reports or inquired about
problems concerning ATMs they believed they had bought. For
example, in the fall of 2006, a victim visited the location of an
ATM in Florida that he thought he had purchased from NETSCHI’s
company and that was purportedly being serviced by MOORE’s
company. The investor could not find the ATM and was informed by
the hotel where the ATM was supposedly located that no such ATM
existed. MOORE then falsely represented to the investor that the
ATM in question had been relocated elsewhere in Florida.
MOORE, 55, of Raleigh, North Carolina, faces a maximum
penalty of 200 years in prison, and a fine of over $2,500,000.
MOORE has also agreed to a money judgment of $50 million and to
specifically forfeit his right, title, and interest in properties
located in North Carolina and Florida.
Manhattan U.S. Attorney PREET BHARARA said, “Today’s
guilty plea confirms that Vance Moore treated his victims like
cash machines to fund his $80 million Ponzi scheme. He
repeatedly lied to them in order to steal their hard-earned funds
pretending to purchase ATM machines that in fact didn’t exist.
This Office, working with our partners at the FBI, remains
committed to exposing, prosecuting and punishing the perpetrators
of Ponzi schemes.”
Mr. BHARARA praised the work of the FBI in the
investigation of this case.
The case is being handled by the Complex Frauds Unit of
the U.S. Attorney’s Office. Assistant U.S. Attorneys ANTONIA M.
APPS, CARRIE H. COHEN, and MICHAEL LOCKARD are in charge of the