HONOLULU — A federal grand jury in Honolulu on Friday returned a 17-count indictment against two Maui residents for operating an alleged Ponzi scheme. George Lindell, 65 , and his daughter, Holly Hoaeae, 39, are accused of operating a pyramid
HONOLULU — A federal grand jury in Honolulu on Friday returned a 17-count indictment against two Maui residents for operating an alleged Ponzi scheme.
George Lindell, 65 , and his daughter, Holly Hoaeae, 39, are accused of operating a pyramid scheme between January 2005 and November 2010. The indictment charges the two, who were Maui residents at the time of the alleged offenses, with 13 mail fraud and three wire fraud violations and one count of money laundering conspiracy.
Each charge carries a maximum possible sentence of 20 years imprisonment. The indictment also seeks a forfeiture of various properties and assets of up to $8,626,588.86, which are allegedly proceeds obtained as a result of the fraud.
In addition, the defendants face fines of up to $250,000 on each of the fraud violations and up to $500,000 or twice the value of the funds or financial instruments involved on the conspiracy charge.
U.S. Attorney for the District of Hawaii Florence T. Nakakuni said that according to the indictment, Lindell and Hoaeae, neither of whom was licensed by the state of Hawaii to accept deposits or investments, induced others to invest funds with them in an investment described as “The Parking Lot.”
Investors were told they could earn between six and eight percent returns on their investments. Instead of investing the funds into safe holdings such as bonds, as represented, the defendants used the funds for their personal needs.
The indictment alleges Lindell and Hoaeae refinanced investors’ personal residences through their business “The Mortgage Store” for amounts well above the existing mortgages against those properties. They are accused of inducing clients to invest the equity drawn from their personal homes with them, and then used it to construct a personal residence in Lahaina, a Lexus automobile, debt on a truck loan, and a New Zealand safari.
The charges contained in the indictment are merely allegations, and the defendants are presumed innocent until and unless proven guilty.
The case was investigated by agents of the Federal Bureau of Investigation. Assistant U.S. Attorney Ken Sorenson is handling the prosecution of the case.
