JEFFERSON CITY, Mo. – A Columbia, Mo., man pleaded guilty in
federal court today to an investment fraud scheme.
Billings Chapman, 78, of Columbia, pleaded guilty before
U.S. Magistrate Judge Willie J. Epps, Jr., to one count of mail fraud and one
count of money laundering.
Chapman owned an interest in CheckmarcUSA, LLC, a company
formed to provide bad check collection services to banks. He also owned Federal
Financial Services, LLC (FFS), which he used to solicit investors.
By pleading guilty today, Chapman admitted that he engaged
in a scheme from May 26, 2011, to April 30, 2014, to defraud investors by
making materially false representations and using investment funds for his own
personal benefit. Chapman guaranteed monthly payments to investors and
misrepresented to investors his financial condition and the financial condition
of FFS. Chapman falsely claimed that large numbers of banks had signed up for
CheckmarcUSA’s services and that FFS was accruing substantial income as a
result.
Chapman did not tell investors that he had been barred from
engaging in the securities industry in 1970 by the National Association of
Securities Dealers, or that he had been issued cease and desist orders in 1991
and in 2004 from the Missouri Commissioner of Securities for engaging in
fraudulent or illegal practices in the securities business. Chapman, who was
not registered to sell securities in Missouri, used investor money for his own
personal gain and to make payments to prior investors.
The money laundering charge to which Chapman pleaded guilty
is related to the transfer of $100,000 that was derived from the fraud scheme.
Under federal statutes, Chapman is subject to a sentence of
up to 20 years in federal prison without parole. The maximum statutory sentence
is prescribed by Congress and is provided here for informational purposes, as
the sentencing of the defendant will be determined by the court based on the
advisory sentencing guidelines and other statutory factors. A sentencing
hearing will be scheduled after the completion of a presentence investigation
by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Jim
Lynn. It was investigated by the FBI.
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