Arkansas man pleaded guilty, accused of fleecing investors of up to $9.5 million

Conviction carries up to 20 years in prison, $250,000 fine

FORT SMITH -- William Jackson Moates Jr. pleaded guilty in federal court last week to fraud, theft and money laundering after he was accused of fleecing investors and the government out of as much as $9.5 million.

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Moates, 49, of Fort Smith entered into a plea agreement with the U.S. attorney's office, admitting to six counts of a 25-count indictment issued in May. He has been free on a signature bond since his initial appearance in court.

At the hearing before U.S. District Judge P.K. Holmes III on Oct. 11, Moates pleaded guilty to two counts of wire fraud and one count each of mail fraud, money laundering, theft concerning a program receiving federal funds, and theft or embezzlement from an employee benefit plan.

Assistant U.S. Attorney Aaron Jennen told Holmes that the amount the 25 investors lost ranged from $3.5 million to $9.5 million. Some entries in bank records were vague about what money went where, he said, and discussions between the government and Moates are continuing. He said a more precise total of the money stolen would be available at the sentencing hearing.

Moates' sentencing hearing will be scheduled after the completion of a pre-sentence investigation, which can take about two months.

The longest sentence he could receive for the offenses to which he pleaded guilty is 20 years in prison and a fine of up to $250,000. Moates also will be ordered to forfeit property, the amount of which will be announced at the sentencing, Holmes said.

Moates was scheduled to go to trial Oct. 3 on the indictment charges, but his attorney Rex Chronister of Fort Smith requested a delay in mid-September because Moates had undergone surgeries in July and September for Dercum's disease, a disorder characterized by painful tumors in fatty tissue.

His client would need up to four more surgeries in the next six months, Chronister wrote. It was not discussed in court whether Moates' health problems had an effect on his decision to accept the plea agreement.

Moates seemed lucid and alert in court. He sat with his attorney, writing at times during the hearing, and he asked Holmes questions a couple of times.

About 20 people, family members and investors, sat in the audience. Jennen told Holmes that victims would not make any impact statements until the sentencing hearing.

According to his plea agreement, Moates owned several businesses in Fort Smith and, with others, recruited investors with the promise of investing their money in such things as annuities, precious metals and stones, businesses, art and automobiles.

He also helped investors create employee benefit plans and set up an advance medical payment plan for which he received more than $2 million from the U.S. Department of Health and Human Services.

But instead of investing the money of the 25 people who entrusted their funds to him or using the government money as it was intended, the plea agreement said, he used the money to renovate his home, take vacations, make credit card payments, make payments to personal iTunes and Amazon accounts, make contributions to local charitable organizations and make home mortgage payments.

"Moates would also use client funds to make disbursements to other clients whose investment money he had liquidated and/or dissipated," the plea agreement said. "These payments allowed Moates to conceal his fraudulent conduct by causing investors to believe that Moates had successfully invested their money as represented."

In January 2015, the plea agreement said, Moates' business partners learned about his scheme. They met with one person who had invested about $4 million with Moates. The investor confronted Moates about stealing his money, and Moates apologized.

The investor went to the FBI in March 2015, the agreement said, and agents and Jennen met with Moates, who admitted stealing clients' money in the amount of $2 million to $3 million.

FBI agents searched Moates' computer records and found a list containing 11 clients to whom he owed $6.9 million, according to the plea agreement. The list included all but five of the investment client victims who had not recouped their investments as identified in the investigation of Moates' business accounts.

State Desk on 10/18/2016

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