Brentwood CEO Pleads Guilty in Multimillion Dollar Fraud Case
NASHVILLE – The chief operating officer of a Brentwood, Tenn.-based wellness social network faces prison time and a criminal fine of up to $5 million as well as restitution to his victims after admitting guilt in connection to a multimillion dollar investment scheme.
Franklin resident George David George, 61, pleaded guilty this week during a hearing before U.S. District Court Chief Judge Kevin H. Sharp to charges of securities fraud, mail fraud, wire fraud and money laundering. George had been investigated by federal and local law enforcement agencies along with the Tennessee Department of Commerce & Insurance’s (TDCI) Securities Division.
George acknowledged being the founder and CEO of WellCity, Inc., a company based in Brentwood, Tenn. that operated a wellness social network and that he solicited millions of dollars from investors by making misrepresentations regarding the revenue and assets of WellCity, misrepresentations regarding collateral to secure investors’ loans, and misrepresentations regarding the status of a supposed initial public offering.
George also admitted that he falsely promised investors that their investments were guaranteed and involved no risk. George further acknowledged that he continued to offer supposed shares in WellCity stock even after TDCI’s Securities Division issued a Cease & Desist Order prohibiting him from doing so.
“Securities fraud can ruin lives and erode the trust that investors have that the system will help protect honest, hard-working Americans from financial predators,” said TDCI Assistant Commissioner for Securities Frank Borger-Gilligan. “This guilty plea is the result of years of work and cooperation between federal and local agencies. We are happy with the result and remain vigilant in serving Tennessee investors.”
George faces up to 20 years in prison on each fraud count and up to 10 years on the money laundering count. He also faces a criminal fine of up to $5,000,000 and forfeiture of criminal proceeds, and he will be ordered to pay more than $2.3 million in restitution to his victims. George will be sentenced by Chief Judge Sharp on June 10, 2016. His sentence will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and applicable federal statutes.
The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service - Criminal Investigation, and the United States Postal Inspection Service, and the Williamson County Sheriff’s Department, with assistance from the Tennessee Department of Commerce and Insurance. The case is being prosecuted by Assistant U.S. Attorney William F. Abely.
For information, contact the Tennessee Securities Division at 1-800-863-9117.