A San Francisco entrepreneur turned white-collar criminal has been sentenced to more than two decades in prison after he lied to Bay Area investors, telling them that Microsoft would be acquiring his company, Ecast Inc.
A federal Grand Jury indicted Mouli Cohen, aka Samuel Cohen, last August, charging him with 19 counts of wire fraud and 13 counts of money laundering and tax evasion. On Nov. 9, 2011, he was found guilty of operating a massive investment scheme in which he ripped off some $31 million from more than 50 people.
Evidence presented at trial proved that Cohen, 54, duped investors -- most of whom were affiliated with Vanguard Public Foundation, the former San Francisco nonprofit -- into thinking that Ecast was on the brink of acquisition by Microsoft, which influenced victims to buy more than $6 million of Cohen's founders' shares in Ecast.
Cohen falsely said this investment would yield opportunities for investors to contribute a substantial amount of the profits to Vanguard.
Cohen's lies continued to pile up. He told investors first that U.S. regulators, and later European Union regulators, were delaying the acquisition. He then told investors that they needed to pay their share of the fees and to post bonds held in escrow to assure the acquisition was successful. If not, victims were told they would lose their prior investment, federal prosecutors said.
To make his story more believable, he told victims that other larger investors, including hot-shot firms in Silicon Valley, were kicking in for the bonds and the fees. Over the course of thee years, investors paid $25 million toward this purported acquisition.
Cohen was well aware that there was no acquisition in the works, while he pulled in millions of dollars from defrauding investors. He bought himself $6 million in private jet rentals, jewelry, a Rolls Royce, a Jaguar, trips to Italy and France, and paid his $15,000 rent for a home in Belvedere, Calif., prosecutors say.
What's more, he reported almost no income on his tax returns and paid zero taxes.
Needless to say, the jury didn't sympathize with him, and now he's being forced to trade in his Brioni Vanquish suit for prison scrubs.
Follow us on Twitter at @TheSnitchSF and @SFWeekly