FraudBaron.com

In 18 months in 2006 and 2007, according to a civil forfeiture complaint filed by the prosecutors against the home, Stefan Andre Wilson collected more than $9 million from 45 investors and paid investors $2 million in purported "capital appreciation."

The bulk of the balance – $5.1 million – was lost by Wilson day trading in the stock market, the complaint alleges, and he chalked up at least $1.1 million in personal expenses. He transferred $338,000 to a bank account of "Shake the Nations," an entity controlled by Wilson, the complaint says.

It says he used more than $403,000 in 2006 to make a down payment on the home on Glen-Mady Way in Folsom, and used fraudulent information to borrow the $750,000 balance on the purchase price. He also used at least $38,875 of investors' money in 2007 to make monthly mortgage payments on the home, the complaint says.

When Wilson applied for the house loan, he included in the supporting documents a statement for a TD Ameritrade account showing a balance of $947,958. The actual balance was 46 cents, according to the complaint.

Wilson's fund was a classic "Ponzi scheme," in which the con artist makes minimal periodic payments to investors, usually alleged to be earnings on their investments but are actually "lulling payments … so as to not arouse suspicion and to keep investors from asking for a refund … of their principal," the complaint states.

The 44-year-old Wilson, who the complaint says changed his name a year ago "to prevent investors from checking his background and finding a prior fraud conviction from 2002," is the subject of an ongoing investigation by the Internal Revenue Service and is expected to eventually face criminal charges.

When a search warrant was executed at the Folsom home on Feb. 15, Wilson admitted to agents that he had e-mailed monthly investor statements that misrepresented the account balance of each investor, the complaint says. It also says he admitted that he misrepresented the performance of his investment fund to attract new investors, and he used investors' money for the down payment and mortgage payments on his $1.1 million home.

He said the down payment was a "loan" he planned to start repaying in 2010.

The complaint, which seeks a court order authorizing authorities to seize the home, was filed late Thursday by Assistant U.S. Attorney Courtney Linn. It says the home, owned in the name of Wilson's wife, is subject to forfeiture because it was purchased with the fruits of unlawful activity, namely mail and wire fraud in furtherance of Wilson's scam.

At least two victims interviewed by IRS agents said they refinanced their homes to make large investments in Christians in Crisis or CIC Investment Fund, the vehicle through which Wilson allegedly ran his scheme.  Linn wrote in the complaint that "neither Wilson nor his wife had any known source of income other than investor funds," and there is probable cause to believe "Christians in Crisis conducted no legitimate business and that the sole purpose of the business is to perpetrate the scheme to defraud."

Wilson could not be reached Friday for comment. His attorney, Peter Kmeto, declined to comment.

Wilson, who listed his occupation in a 2005 bankruptcy petition as "Consultant/Non-profit ministry," solicited investors for a "a high-risk hedge fund." A "subscription agreement" promises a 24 percent annual return.

One investor interviewed by IRS agents said Wilson claimed "he and others had developed proprietary software that allowed them to successfully predict when to buy and sell stock."