By Stan Welch
The federal legal proceedings, originating with a criminal investigation into the financial activities of former Anderson County councilman Ron Wilson continue to make waves, as recently as last week. Candy Kern Fuller, an Easley attorney who was associated with Wilson, as well as other participants in Wilson’s Ponzi scheme, has been named in a federal lawsuit to recover profits Fuller made from her participation in the fraudulent silver investment scheme.
Fuller, who repeatedly and adamantly denied any illegal role in the scheme, which garnered Wilson and others approximately fifty seven million dollars in ill gotten gains, claimed in the past that she too was an innocent investor. She claimed that she managed to recoup her original investment of $10,800, but did not profit. In fact, she led an aborted attempt to organize a class action against Wilson.
The lawsuit filed by the federally appointed receiver in the case, Beattie Ashmore, disputes her claim that she did not profit. The lawsuit claims that on June 23, 2011, she withdrew $35,000 from her account at Atlantic Bullion & Coin, the business which Wilson used as the instrument of his confessed fraud. The lawsuit asks the court to force reimbursement of the $24,200 profit which Fuller made on her original investment.
Like any other assets recovered, those funds will go towards whatever reimbursement of the fraud’s victims is possible.
According to documents filed by Ashmore in federal court earlier this month, Fuller invested $5400 on each of two separate occasions, just over a week apart during the spring of 2009. It was during that same general time period that Fuller began representing former county administrator Joey R. Preston in his lawsuit against Anderson County, which was seeking to recover a $1.2 million severance package that the lame duck Council had awarded him just weeks before they left office.
She was concurrently representing various clients in tangential lawsuits challenging the legal authority of the County to conduct an investigation of Preston’s administration. One such lawsuit, filed by Michael and Doreen Montepara, Erick Bradshaw, Cordes Seabrook and former Anderson Independent Mail publisher Fred Foster, was quickly thrown out of court. Fuller then appealed and the state Supreme Court quickly affirmed the lower court’s decision, calling Fuller’s argument absurd.
Subsequent revelations of that investigation indicated that Wilson’s daughter, Allison Schaum, also named as a participant in the Ponzi scheme, received a lucrative extension of a consulting contract she had with the County just weeks before her father presented the severance package, which he admitted he unilaterally and without authorization, instructed the county’s legal counsel in the matter to draw up.
Wilson and Preston were well known associates, both personally and professionally. Preston has since been ordered to return some $600,000 he received as a result of his role in luring and bilking investors in Wilson’s scheme. When the news of Wilson’s arrest and the closing of his business first became public, Fuller also stated, on behalf of her client Preston, that he too was an innocent victim.
In the documents filed last week, claims are made and details supplied that essentially argue that anyone of normal prudence should have been alerted to a number of warning signs that the scheme was fraudulent and beyond reasonable belief. The arguments amount to one large general claim that anyone who failed to see the scheme for what it was basically did so willingly.
Among some of those red flags mentioned were the fact that an investor who wanted to withdraw money from their account had to wait for thirty days, ostensibly to give Wilson time to obtain or transfer funds in order to cover the withdrawal being made. Similarly, investors were often asked to provide an explanation for their withdrawal, a requirement that would not exist in a regulated financial institution.
Court documents also state that Fuller never provided Wilson or his company with a federal social security number, driver’s license or any other proof of identity. Apparently, she never once approved a buy/sell order, as is typical with a licensed broker.
Instead, Wilson apparently had carte blanche to sell and buy silver on her behalf. Court records indicate that none of the trades conducted on her behalf amounted to less than one hundred per cent profit. According to court documents, Fuller never sought nor received “any year end tax accounting or report, including but not limited to a K- or 1099.”
Wilson is currently serving 235 months in federal prison on the original charge of two counts of mail fraud. He was sentenced on July 30, 2012. He has since been indicted and pled guilty to an additional charge, this one of secreting assets from the government receiver. Several hundred thousand dollars in cash were discovered in the possession of family members. He has received an additional sentence for that charge.
Fuller has twenty one days from the date of service of the lawsuit to respond, or a judgment against her will result by default.