JACKSON COUNTY, OH (WOWK) – Two men from Texas have been indicted by a federal grand jury in connection to a $50 million Ponzi scheme involving off-the-road tires with ties to Jackson County, Ohio.
According to Southern District of Ohio Kenneth L. Parker, John K. Eckerd, Jr., 58, of Dallas, and Afif Baltagi, 45, of Houston are accused of conspiring in a Ponzi scheme that defrauded more than 50 investors, soliciting victims from across the country and around the world. Parker says authorities allege Eckerd may have been the “leader” of the conspiracy.
In August 2022, Parker said another man, Jason E. Adkins, 46, of Jackson, was sentenced to 108 months in prison for his part in the conspiracy. In April 2019, Adkins pleaded guilty to the charges against him.
The court also convicted Adkins of laundering the money for at least five years, claiming he also invested in “front businesses” his co-conspirators created. Adkins is accused of using the money he got out of the scheme to buy cars, take vacations, buy property, construct a pool at his home and lease a private jet for more than $20,000.
Parker says court documents show that defendants allegedly conspired and solicited millions from investors under false pretenses between 2012 and 2018. They also allegedly failed to invest the victims’ funds and misappropriated those funds to benefit themselves.
Eckerd is also accused of representing himself as an entrepreneur and businessman who had an “expertise in the market for off-the-road tires,” and allegedly had control or access to many of the corporations used in the scheme, according to Parker. His office also says Baltagi is accused of working in logistics for a freight company that had access to a Houston storage yard where the tires were stored.
Court documents say the defendants, along with others allegedly involved in the scheme, are accused of claiming to buy and sell over-sized, off-the-road tires used for earth moving equipment and mining equipment. They allegedly told investors the money they invested would be used to buy the tires for cheap so they could be resold at a higher rate, according to court documents.
When Adkins was sentenced, Parker said investors were promised 15%-20% of the rate of return and that they would get it within 180 days and would sometimes pay the victims for the first transaction.
Adkins and others claimed that they bought and sold over-sized tires commonly known as off-the-road tires, which are used on earth moving equipment and/or mining equipment. Investors were told their money would be used to buy the tires at a steep discount, and that the tires would then be re-sold to a buyer at a much higher rate.
According to Parker, authorities allege the defendants rarely bought actual tires, and when they did they would allegedly use the same tires for multiple deals. He also says Baltagi is accused of using his employer’s tire yard to help deceive the investors.
Parker’s office says Eckerd is also accused of allegedly lying on his tax forms and conspiring with others to avoid paying owed taxes. Authorities say this allegedly resulted in a tax loss of more than $1 million between 2013 and 2014, and that Eckerd allegedly did not file taxes in 2016 or 2017. He is also accused of allegedly transferring $1 million between two bank accounts on the same day he filed for bankruptcy in 2018.
Parker also says Adkins did not file individual income tax returns that reported the income from his scheme.
The scheme also included a “sham escrow agent” hired by Adkins and his co-conspirators who would falsely reassure the victims, according to Parker. Court documents say more than $80 million flowed through the “agent’s” accounts in connection to the scheme.
According to Parker’s office, a fourth man, Todd Wilkin, 60, of Hillsboro, Ohio, also pleaded guilty in January 2022 to his role posing as a “neutral third-party seller” in the deals Adkins arranged. Wilkin is awaiting sentencing, Parker says.