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Four plead guilty in mail fraud case

May 07, 1999|By MARLO BARNHART

The four men indicted last year in two Hagerstown-based get-rich-quick companies that bilked thousands of consumers out of millions of dollars have pleaded guilty to mail fraud.

John Thomas Polk, 39, of Dallas is free on $1 million bond after his plea May 3 in U.S. District Court in Baltimore, according to Lynne A. Battaglia, U.S. attorney for Maryland.

David C. Bowen, 36, also of Dallas; Steven Clements, 45, of Humble, Texas; and Matthew F. Foulger, 31, of Arizona, all have pleaded guilty to one count of mail fraud, according to the U.S. attorney's office. They are free on lesser bonds.

Sentencings are scheduled for the week of July 12. Mail fraud carries a maximum penalty of five years in prison and a $250,000 fine.

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Peak Performance Institute and its successor company, Success Achievement Systems, operated in Hagerstown in three different locations between 1992 and 1996, according to Barry O'Neill, a special agent with the FBI who worked on the case for two years.

The addresses of the companies were 19723 Leitersburg Pike, 1710 Underpass Way and 91 Western Maryland Parkway.

"They had two ways of getting people's money," O'Neill said. "They would contact people by direct mail or through infomercials on television."

Once the person expressed interest, they would be invited to a free seminar where they would be pitched to spend $499 to $599 for a program called "Inside Secrets to Real Estate and Government Auctions."

Purchase of the program then entitled the consumer to use "John Polk's money" or "Matthew Foulger's money" in joint ventures to purchase items at government auctions or to fund real estate purchases, O'Neill said.

A second come-on to buy another $500 program called "Elite Performer" entitled the consumer to embark on joint ventures with the two companys on approved commercial real estate programs supposedly worth more than $150,000, according to the indictments.

All the while, the consumers' money was coming in but Polk and Foulger were never doing joint ventures with their own money, according to the U.S. attorney's office.

The infomercials and the mailings were misleading, talking about the successes of people picked at random who turned out to be friends or relatives of Foulger or Polk.

Offices were vacated when rent couldn't be paid as the men moved from state to state just ahead of investigators, according to the U.S. attorney's office.

O'Neill said the victims numbered in excess of 17,000 who invested more than $20 million in the programs.

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