From U.S. Department of Justice, U.S. Attorney’s Office, District of South Carolina. Original Press Release found here.
Columbia, South Carolina – United States Attorney Sherri Lydon stated today that Melvin Leonard Wimmer, Jr., age 53, of Greenwood, South Carolina, was sentenced in federal court in Greenville, South Carolina, for Securities Fraud. Senior United States District Judge Henry Herlong, of Greenville, sentenced Wimmer to 75 months imprisonment and 5 years Supervised Release. The court also ordered Wimmer to pay $3,056,000 in restitution.
Evidence uncovered in the investigation established that in 2007, Wimmer started an investment firm in Greenwood called Cornerstone Capital. From 2010-2017, approximately 25 individuals invested $3.6 million with Wimmer. Wimmer pooled the money into one bank account, and he invested in high-risk securities and futures contracts.
Wimmer committed fraud by issuing fraudulent account statements to his investors. Soon after he started trading options and futures, Wimmer lost money, and he continued to lose money throughout the scheme. Instead of reporting the losses, Wimmer emailed his investors monthly account statements that falsely listed gains of 8-10 percent on an annualized basis. Wimmer manufactured and distributed false account statements from the outset, and he continued until the scheme collapsed. Wimmer also falsely represented the expected gains from trading, including the past performance of his trades, and he failed to inform the investors of the high risk of trading futures and options. Of the $3.6 million invested, Wimmer lost approximately $3 million. Much of this money came from the investors’ retirement savings.
United States Attorney Sherri Lydon noted that “this prosecution illustrates the devastating impact that financial fraud inflicts on many Americans. Sadly, many of the victims in this case are elderly and lost all of their retirement savings. A free market system cannot function without integrity in the financial markets.”