By Beth McPherson
News Journal staff writer
Seven defendants accused of using a pyramid scheme to bilk investors out of up to $95 million will go on trial in September.
During an arraignment hearing Thursday in federal court, all seven pleaded not guilty to charges including conspiracy to commit wire fraud, securities fraud and money laundering.
An eighth defendant will be arraigned by video from Phoenix, Ariz., today.
U.S. District Judge Miles Davis set the trial for Sept. 5.
Defendants at Thursday's arraignment included William West of Niceville; Kenneth Cobb of Phoenix; David Bishara of Niagara Falls, N.Y.; Melody Rose of West Palm Beach; David Johnson and Mark Talley of Memphis, Tenn.; and Jeffery Matz of Scottsdale, Ariz.
Not present at the arraignment were Benjamin David Guilleland of Memphis; Phillip Nesmith of Phoenix, who will be arraigned today; Jerrold Gunn of Winnipeg, Manitoba, Canada; and William Dohan of London.
Guilleland was taken into custody in Tennessee and is being extradited to Pensacola for arraignment. Neither Gunn nor Dohan have surrendered to authorities.
If convicted, the defendants face up to five years in prison for conspiracy to commit wire fraud and securities fraud and up to 10 years for each money-laundering count.
Indictments against the group were returned by a federal grand jury on June 20, charging the group created and operated three trading programs that lured wealthy investors with promises of low-risk investments that would yield a profit of more than 300 percent.
The Florida Department of Banking and Finance said the secret trading programs never existed, and money from later investors was used to pay off earlier investors in a classic pyramid or ``Ponzi'' scheme.
According to the indictment, the money collected was laundered through a number of corporate entities and bank accounts onshore and offshore before being pocketed by the defendants.