A Logan man was charged in federal court with stealing more than $308,000 from investors through a fraudulent horseracing venture and using the money to buy expensive clothes, vehicles and pay for gambling expenses, law enforcement officials said.
The charges were announced by U.S. Attorney Carole Rendon, Kathy Enstrom, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation, Cincinnati Field office, and Craig Wisniewsky, Special Agent in Charge of the Secret Service’s Cleveland office.
Jonathan Pippin, 29, was charged via criminal information with two counts of wire fraud and one count of money laundering.
Pippin created PJH Horse Racing, Inc. in 2011. The company was headquartered in Cleveland and purported to be in the business of purchasing race horses. Pippin had sole control over the company and its various bank accounts, according to the information.
Pippin solicited investors to his company under false pretenses. He told potential investors that they were investing in a venture with a wealthy businessman and widely-known horse racing figure - identified in the charges only as M.R. - when in reality Pippin did not know M.R.
Pippin falsely represented to investors that they would receive a percentage of the winnings of M.R.’s horses when he knew it was not true. He also told investors that he had stud rights to M.R.’s horses when he did not, according to the information.
Pippin used the investors’ money to enrich himself and pay personal expenses, such as the purchase of a Cadillac Escalade, tickets to sporting events, gambling expenses, rent and expensive clothing, according to the information.
Four investors lost a combined $308,305, according to the information.
“This defendant created a web of lies to pay for fancy cars, expensive clothes and gambling expenses," Rendon said. “He defrauded investors to pay for a lifestyle he couldn’t afford. Now he’ll be held accountable for his actions."
“Investment fraud schemes are often described as a house of cards," Enstrom said. “In this case, when the dust settled, the underlying structure fell apart and exposed the individual responsible."
“This case is another example of the success of the task force concept where multiple federal agencies bring expertise to an investigation resulting in a successful conviction," Wisniewsky said.
This case is being prosecuted by Assistant U.S. Attorney Christos M. Georgalis following an investigation by the IRS-CI and United States Secret Service.
If convicted, the defendant’s sentence will be determined by the court after a review of the federal sentencing guidelines and factors unique to the case, including the defendant’s prior criminal record (if any), the defendant’s role in the offense, and the characteristics of the violation.
An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Source: U.S. Department of Justice, Office of the United States Attorneys
