a former fugitive accused of lying to investors a billionaireA Harvard MBA, and a Special Forces veteran, pleaded guilty Wednesday to an alleged $35 million fraud case, a court filing shows.
Cannabis mogul Justin Costello, 42, is accused Federal Court in Washington State to dupe thousands of investors and others with false and frivolous claims about themselves
Costello, who fled after learning he was indicted in late September, has been held without bail since early October when an FBI SWAT team Arrested him In a remote area outside of San Diego.
At the time, authorities said, he was carrying a bag containing $12,000 worth of gold bars, $60,000 in US currency, $10,000 in Mexican pesos and an ID with his photo and someone else’s name.
Costello later pleaded not guilty in the case.
But a court filing said Costello is now scheduled to appear for a change of plea hearing in US District Court in Seattle on Wednesday. This type of hearing is usually scheduled for when a defendant plans to plead guilty.
Costello’s attorney, Dennis Carroll of the federal defender’s office, wrote “no comment at this time,” when CNBC emailed him to ask about the hearing.
Emily Langley, a spokeswoman for the US Attorney’s Office for the Western District of Washington, which is prosecuting Costello, declined to comment.
Costello is charged with 22 counts of wire fraud and three counts of securities fraud in his criminal case. he also faces civic duty A separate lawsuit was filed by the Securities and Exchange Commission accusing him and another person of defrauding investors in a penny stock promotion scam.
Nick Brown, the US attorney for the Western District of Washington, previously said Costello “allegedly told many tall tales to persuade victims to invest millions of dollars – money they then used for their own benefit.” “
Prosecutors say Costello used one of his companies, Pacific Banking Corp., to illegally divert at least $3.6 million to himself and other firms while offering banking services for three marijuana companies.
Cash and gold bars as part of a filing in US District Court in San Diego in the case of former fugitive Justin Costello.
Source: US District Court
They also accused him of a scheme that cost more than 7,500 investors about $25 million by making false claims about alleged plans by one of his firms to buy about a dozen other companies. Approximately 30 investors lost $6 million after investing directly based on Costello’s false claims.
Costello’s indictment states that he falsely claimed to have graduated from the University of Minnesota, earned a master’s degree in business administration from Harvard, served two tours in Iraq as a member of the US Special Forces, and was injured. during that time.
Costello also falsely claimed to be a billionaire, having managed money for wealthy individuals including a Saudi sheikh, and had “14 years’ experience on Wall Street,” according to the indictment.