Trevor Cook pleads guilty in $190-million Ponzi scheme
Trevor Cook pleaded guilty today in federal court to leading a $190-million Ponzi scheme based in part out of the Van Dusen mansion in Minneapolis that obliterated the investments of at least 1,000 victims while he lived high on the hog and paid off gambling debts.
Appearing before U.S. District Court Judge James M. Rosenbaum, Trevor Gilson Cook pled guilty to one count of mail fraud and one count of tax evasion in connection to his crime.
Cook faces a potential maximum penalty of 20 years in federal prison on the mail fraud charge and five years on the tax evasion charge.
A sentencing date has not been set.
The feds say that Cook, along with business partner and nationally syndicated radio host Patrick J. "Pat" Kiley, hoodwinked their victims into making allegedly safe, high-yield foreign currency investments that turned out to be neither.
In his plea agreement, Cook admitted that from January 2007 through July 2009 he, aided and abetted by others, schemed to defraud no fewer than 1,000 people out of approximately $190 million by purportedly selling investments in a foreign currency trading program. In reality, however, he diverted a substantial portion of the money provided him for other purposes, including making payments to previous investors; providing funds to Crown Forex, SA, in an effort to deceive Swiss banking regulators; purchasing ownership interest in two trading firms; buying a real estate development in Panama; paying personal expenses, including substantial gambling debts; and acquiring the Van Dusen Mansion in Minneapolis.
Cook was ordered to jail in January by a federal judge because he refused to hand over more than $35 million in frozen assets. Among them: $27 million located in offshore accounts, a BMW and two Lexus automobiles, a private submarine, a houseboat, a collection of expensive watches, a collection of Faberge eggs, Bon Jovi concert tickets, and $670,000 in cash.
Here are just three of the roughly 1,000 people the feds say were screwed over by Cook and Kiley
- James Cochran, a 61-year-old dry wall contractor from California, who invested $200,000 after an initial meeting with Cook at the Van Dusen Mansion, and followed that with an $800,000 deposit.
- Fifty-year-old Thomas Hoel, of Woodbury, Minn., who owns and runs a physical and occupational therapy center for children with special needs. He followed an initial $83,834 investment with another $12,000.
- Lonsdale, Minn., farmer and self-employed grain broker Edward Smisek, 61, put $111,669 into the foreign currency program.
"Cook and Kiley told investors that their money would be invested safely and profitably," said Merri Jo Gillette, Director of the SEC's Chicago Regional Office. "Instead, they went on a $40 million-plus spending spree with investors' money and lost another $40 million in risky foreign currency trading."