CHARLOTTE, N.C. (QUEEN CITY NEWS) – Two Cornelius men pleaded guilty to wire fraud Thursday, June 1, for orchestrating an investment scheme spanning 12 years, the U.S. Attorney’s Office announced.
According to Mecklenburg County court documents and the plea hearings, from approximately 2009 to 2021, Marlin Hershey and Dana Bradley, both 53, conspired to defraud numerous victims who invested in two unregistered securities offerings promoted by the defendants, Performance Retire on Rentals, LLC (Performance Retire) and Distressed Lending Fund (DLF).
As the defendants admitted in court, both projects eventually failed causing significant losses to investors. As reflected in court documents, Hershey and Bradley provided victims with investment materials for the two securities offerings that contained false and misleading statements and did not disclose material information.
For example, the Attorney’s Office said Hershey and Bradley failed to disclose that they received commission-like payments based on the amount of investments they sold. In fact, the defendants often provided investors with offering materials that represented the opposite – that nobody would be paid a commission in connection with the investments.
Contrary to their statements, the defendants received payments that were typically 10 percent of an investor’s initial investment and often received an additional payment when an investor extended an investment. In this manner, Hershey and Bradley received hundreds of thousands of dollars in undisclosed payments from the sale of securities.
Court records also show that Hershey and Bradley failed to disclose to investors other material information, including negative information about the defendants’ backgrounds and the financial woes faced by some of the entities for which they were soliciting investments. The defendants took steps to conceal such financial difficulties by making undisclosed loans to various entities so that the entities could, in turn, make their required interest payments to investors.
In 2019, investors learned for the first time that the projects in which they had invested were in financial distress and could no longer meet their significant obligations to investors. After entering their guilty pleas the defendants were released on bond.
The wire fraud conspiracy charge carries a maximum sentence of 20 years in prison and a $250,000 fine.
A sentencing date has not been set. Assistant U.S. Attorneys Daniel Ryan and Taylor Stout, of the U.S. Attorney’s Office in Charlotte, are prosecuting the case.