Two businessmen in Columbus, Ohio ripped off investors for a total of $9 million through a sports drink company that they set up in nearby Westerville. They then drove that company into bankruptcy, according to the federal indictment.
It states that former OSU football player Preston Harrison and his business partner, Thomas Jackson, lied to investors from the start about their firm, called Imperial Integrative Health Research & Development, and the sports drink that it made.
Jackson, Harrison, and Harrison’s wife were arrested this week and will appear in federal court in Columbus tomorrow. They were indicted by a grand jury on Monday.
Each man faces 31 counts of wire fraud, money laundering, conspiracy to commit wire fraud and conspiracy to commit money laundering.
The Harrisons also are charged with conspiracy to defraud the IRS and for filing a fake income tax return.
The maximum prison sentence for these federal charges are 20 years for each wire fraud charge, and 10 years for each money laundering charge.
The indictment states that the two men brought in investors with a private offering memorandum that had false information about their salaries and investments in the firm. There also was false information about the employees of the company and the product OXY Water. The memo stated falsely that OXY water had a higher level of oxygen than other sports drinks.
Jackson and Harrison kept lying to investors after the firm started to operate. They provided false sales figures and profit information, according to the indictment. Jackson used the company’s accounts for his personal expenses, and Harrison diverted over $1 million of the firm’s money into another bank account.
Several OXY water investors became concerned about the company in 2012 and hired a lawyer. The IRS and FBI conducted an investigation and seized a 2009 Cadillac, a 2008 BMW and a bank account with $651,000 in it. Harrison apparently used some of the business funds to buy the cars, as well as eight firearms.
About Money Laundering
Money laundering is any sort of organized network of actions that is intended to take money obtained illegally so that it appears the money was gotten legally. Money laundering is one of the most common crimes of the Mafia. Criminal organizations use front businesses that seem to be lawful so that they can build a new paper train that allows money to be used for general uses. Most money laundering charges involve racketeering, conspiracy, and other federal crimes.
Penalties for money laundering depend upon the exact nature of the crime. For most crimes, jail and fines are common. Fines can be as high as $500,000, or may be based upon the value of the property. Imprisonment can be for as long as 20 years.
State governments and the federal government have laws against money laundering. These laws are intended to make criminal the illegal activities of large criminal conspiracies that could be working in other crime areas, such as drug trafficking and human trafficking.