Springboro Ponzi scheme defendants could plead

The Springboro couple accused of bilking investors out of tens of millions of dollars in a Ponzi scheme is scheduled to be in court Friday, a hearing that could result in a plea deal, according to federal court sources.

William and Connie Apostelos are scheduled for a final pretrial hearing in front of U.S. District Court Judge Thomas Rose. Their trial is scheduled to begin Feb. 6.

RELATED: Trial postponed in Ponzi scheme case

Court documents show William Apostelos’ hearing could become a plea. An assistant U.S. attorney confirmed that is a possibility.

Connie Apostelos’ attorney said his client’s involvement was much smaller than her husband’s, and he is in plea negotiations with prosecutors.

“Connie is at a substantially different place than her husband,” said attorney Jon Paul Rion. “He was the main target of this investigation. Her involvement cannot be analyzed in the same framework as his.

“So, we are in negotiations and considering these developments. Those changes in the case may or may not affect the necessity of a trial in this case.”

RELATED: Apostelos' attorney faces charges

Apostelos’ attorney, Steven Scudder, is scheduled for a Thursday arraignment and plea by bill of information to a count of wire fraud.

The Aposteloses were indicted in October 2015 on 27 counts alleging that the Springboro couple bilked nearly 500 investors out of tens of millions of dollars in a $70 million Ponzi scheme during at least a five-year period from 2009 to 2014.

The seizures from Apostelos, his wife Connie and her son include two race horses, racing proceeds, bank accounts and cash totalling about $650,000 plus vehicles, jewelry and artwork. Court documents alleged Apostelos' spending included $400 per month on Victoria Secret's lingerie and $35,000 per month on Connie Apostelos' horse racing company.

A message seeking comment was not immediately returned by assistant U.S. attorney Brent Tabacchi.

A related civil lawsuit by some of Apostelos' alleged victims against PNC bank was dismissed by U.S. District Court Judge Thomas Rose.

Rose wrote in his ruling earlier this month that, “The specific issue raised by Defendants’ Motion to Dismiss is whether — reading the Complaint in the light most favorable to Plaintiffs — Plaintiffs plausibly allege that Defendants participated in or assisted the Aposteloses in the sale of unregistered securities. The Court concludes that Plaintiffs have not done so.”

Rose wrote that he recently dismissed a nearly identical complaint (Boyd v. Kingdom Trust Co.) alleging the same cause of action under the Ohio Securities Act.

“In that case, the plaintiffs also alleged that, but for the defendant’s banking services, it would have been impossible for the Aposteloses to sell their unregistered securities,” Rose wrote. “The plaintiffs failed to make any allegation, however, that the defendant ‘acted outside the scope of routine banking activities,’ which Ohio courts have held do not subject financial institutions to liability under (the law).”


STAYING WITH THE STORY

The Dayton Daily News has followed every step of the alleged Ponzi scheme story, starting with the raid of a Springboro business in October 2014, attending federal court hearings and reviewing hundreds of pages of documents related to federal bankruptcy, civil and criminal cases.

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