MINNEAPOLIS (WCCO) – Three Florida men were indicted in Minneapolis Federal Court on Wednesday for fraudulently marketing a hedge fund’s investments in Petters Company, Inc.
Frank E. Vennes, 53, David W. Harrold, 51 and Bruce F. Prevost, 51, all of Florida, were charged with four counts of securities fraud in the alleged crime. Vennes was also charged with one count of money laundering.
PCI was owned and operated by Tom Petters, who represented that funds invested in the company would be used to finance the purchase of electronics and other consumer merchandise. PCI then allegedly resold the merchandise, for a profit, to certain “big box” retailers including Sam’s Club and Costco. But no merchandise was actually ever purchased or resold.
Petters used the money for his own benefit to hundreds of millions of dollars. His $3.65 billion Ponzi scheme came apart in 2008, when federal agents executed search warrants at his business and other locations.
Petters was prosecuted, and in April of last year, was sentenced to 50 years in federal prison. He is currently serving time in the federal penitentiary in Leavenworth, Kan.