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Leader of fraud scheme sentenced to 4-plus years

May 14, 2013

The ringleader of a scheme that defrauded an Indianapolis investor out of $1.7 million was sentenced Monday to four years and nine months in federal prison.

Michael Russell, 54, pleaded guilty in January to 20 counts of wire fraud and money laundering.

Russell, who led an Indianapolis charity called the Russell Foundation, was charged in late 2011 along with former Indianapolis City-County Councilor Paul Bateman and associate Manuel Gonzalez.

Bateman, 58, who also pleaded guilty, is scheduled to be sentenced May 20.

Gonzalez was found not guilty of the charges by a jury in February.

A federal judge on Monday ordered Russell to make restitution to his victim, a doctor who invested the $1.7 million in his foundation and a related ethanol-production business.

Prosecutors say Russell —also known as Rev. Michael L. Russell —and Bateman persuaded the doctor to invest $1 million in a corporate bond for the foundation to help fight poverty and provide community leadership.

Between February 2007 and April 2007, according to court documents, Bateman picked up five checks from the doctor for the ethanol investment totaling $702,000, most of which were deposited into Bateman’s personal account.

Russell and Bateman admitted using the money for entertainment, personal security, clothing, jewelry, travel and vehicles.




 

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