Phoenixville Man Accused in $20M Fraud Case

A 33-year-old Phoenixville man is facing federal charges in connection with what the U.S. Attorney for Eastern Pennsylvania says a $20 Million investment

Timothy D. Burns, 33, of Phoenixville, Pennsylvania was charged Wednesday in a $20 million fraud scheme that involved mail fraud, wire fraud and loan fraud accoording to United States Attorney Zane David Memeger. 

Burns is accused of taking millions from investors to purchase stocks in Facebook but then using the money to buy things for himself, including a $4 millionbeach house in Avalon New Jersey.

According to a news release from the U.S. Attorney's office, "Burns was the sole owner of ESG Family Services, among other businesses.  ESG Family Services provided billing paying and other personal services to clients.  To facilitate his work and, as it developed, his alleged fraud, defendant Burns induced many of his Family Services clients to add him as a signatory to their bank accounts.  He also allegedly represented to clients and others that he could acquire shares of Facebook and other social media stock before their public offerings at favorable prices."

The U.S. Attorney's office says Burns also used money from more than 50 investors in a scheme to "make a down payment on a commercial office building in Conshohocken, Pennsylvania.  In 2012, he allegedly misrepresented to a bank that he had acquired stock, when he had not, to obtain a $6 million mortgage loan on the commercial office building."

According to the U.S. Attorney he also allegedly represented to clients and others that he could acquire shares of Facebook and other social media stock before their public offerings at favorable prices.

If convicted of all charges, Burns faces up to 100 years in prison, a $2.5 million fine, a five-year term of supervised release, a $400 special assessment and restitution of just under $20 million. 

Burns could also be forced to forfeit property totalling about $20 million.