Rexburg day-trader Michael Justin Hoopes, 41, was sentenced to 24 months in prison and three years of supervised release for wire fraud and monetary transactions in property derived from unlawful activity in U.S. District Court in Pocatello Tuesday.
U.S. District Judge Edward Lodge also ordered Hoopes to pay $620,000 in restitution and 200 hours of community service.
In a plea agreement entered on February 24, Hoopes admitted that from 2007 through February, 2011 he engaged in a scheme to defraud investors in various investment opportunities. Specifically, U.S. Attorney Wendy Olson said Hoopes solicited investors to provide him with capital he represented he would use in his commodities futures day-trading activities.
Olson said he misrepresented investors that he earned returns in excess of 20 to 25 percent, that he would invest the capital and pay them from the profits. However, in reality, Hoopes did not invest all of the capital and used much of it for personal expenses, including paying credit card bills.
According to the plea agreement, between 2007 and February of 2011, Hoopes received more than $9 million from investors and misappropriated $620,000 for his personal use.
“Investment fraud schemes often involve individuals who appear extremely credible and trust worthy. When investigated by our special agents who specialize in following the money, these individuals are exposed as greedy and uncompassionate and have devastated the financial well-being of investors whose trust they betrayed,” said Gilbert R. Garza, Special Agent in Charge of IRS Criminal Investigation for the state of Idaho.