A Little Rock man accused of swindling more than 46 people, including several in Pine Bluff, is scheduled to be sentenced this summer after pleading guilty to mail fraud in federal court.
Lee Charles Johnson, 42, could get up to 20 years in federal prison and a fine of up to $250,000 when he is sentenced by U.S. District Judge D. Price Marshall Jr. on Aug. 2 at 1 p.m. at the federal District Courthouse in Little Rock.
Johnson was indicted by a federal grand jury following an investigation by the United States Secret Service that alleged he was selling securities and investment opportunities to three companies he ran, TJC Group, Johnson Food Group, and Keystone Hybrid Fund, and was not licensed to sell securities or give financial advice.
At a plea hearing March 15, Johnson admitted that each victim was told they would have individual accounts in which their money would be deposited and that funds would not be withdrawn from those accounts. Johnson drafted contracts for the victims guaranteeing a 12-15 percent return on their investment, but when he received the money, he used it for personal use, including purchasing vehicles and paying for trips.
He also used the money to make child support payments, tuition payments for his children’s private school, and tens of thousands of dollars in cash withdraws.
Independent reporting for Pine Bluff & Jefferson County since 1879.
According to the United States Attorney’s Office, Johnson mailed maturity date letters which stated that even with the turbulent economic times, the accounts were fully protected.
Victims mailed payments to Johnson each month, and Johnson mailed the victims an account statement on a regular basis, showing the balance on their investment.
The loss to date is $743,846.38.
The U.S. Attorney’s Office said one of the victims was the widow of a man killed in Fallujah who invested all of the military survivor benefits she received with Johnson, while a second invested all of the life insurance benefits she received after her husband died. To date, each woman has had less than $2,000 of those funds returned.
Assistant U.S. Attorney Karen Whatley, who is representing the government, said there will be a restitution provision during Johnson’s sentencing.