Investment Scammer Sentenced

Joe Jones, a North Carolina businessman who was indicted in 2005 on 100 counts of fraud stemming from a Ponzi-type scheme, was sentenced April 2nd by a judge to 20 years in prison as part of a plea agreement.

Jones was indicted for masterminding a type of pyramid scheme where $8.6 million from new investors was used to pay off previous investors, while selling investments for Charlotte-based concert promoter B.A.B. Productions.

Under the agreement, Jones agreed to plead guilty to 41 counts of securities fraud and five counts of obtaining property by false pretense and was sentenced on three of the violations to 80-105 months each to run consecutively, according to the Rocky Mount Telegram.

Jones also agreed to testify against co-defendant Charles Harrison, whose trial on similar charges is reportedly expected to begin at any time, the paper said.

Defense attorney Donald Brown said his client was desperate to repay the investors.

"He panicked," Brown told the paper. "He went down the wrong road, and he never intended to get rich.

"He’s broken spiritually, and he’s broken financially."

Attorney Nancy Vecchia, representing the Secretary of State’s office, testified April 2nd that Jones and Harrison used the concert promotion company to raise cash to fund other investments such as a $50 million time-share project in Detroit, day trading through an Internet account and another project in Texas.

She added that the Detroit and Texas projects tanked and Jones lost about a half-million dollars on the day-trading account.

The North Carolina Secretary of State’s office launched its investigation in 2004 after learning Jones was selling unregistered investments for the concert promoter. He lost his license to sell investments in 2003.

Investigators raided Jones’ former office and seized $1,500 worth of cocaine and marijuana. He was ordered to stop selling investments for B.A.B. Productions.

At the time, Jones admitted to making the sales but claimed B.A.B. president Bernard Bailey should have known the transactions weren’t registered.

Jones was later sentenced to 30 months probation for drug violations after pleading guilty to felony possession of cocaine. That was in addition to a six- to eight- month suspended prison sentence.