Tuesday, December 22, 2015

Coto de Caza couple, the McKinlays to be arraigned in a $3 million investment scam

Posted by CotoBlogzz

Rancho Santa Margarita, Calif. - the Coto de Ca a McKinlay couple will be arraigned tomorrow on charges of defrauding investors and stealing more than $3 million in an investment scheme, according to the Orange County District Attorney's office.
Steven Andrew McKinlay, 58, and Kristi B. McKinlay (licensed as Kindred), 56,  are charged with 10 felony counts of using untrue statements in the purchase or sale of a security, one felony count of grand theft, and one felony count for the use of a device in a scheme to defraud, with sentencing enhancement allegations for loss over $100,000, aggravated white collar crime over $500,000, causing property damage with loss over $1.3 million. 

The McKinlay's are accused of victimizing more than 10 individuals, including a former Major League Baseball player, a family friend who came into money through a devastating personal injury, and a cancer patient who wanted to secure an inheritance for his family. Their investments ranged from $22,500 to over $700,000. Many of the victims had been associated with the defendants through the church they attended. 

At the time of the thefts, Steven and Kristi McKinlay were owners of God's Sports Company (GSC). 
Between Sept. 12, 2011, and June 27, 2015, Steven and Kristi McKinlay are accused of defrauding more than $3 million from more than 10 clients by convincing them to invest in GSC without disclosing material facts, including prior bankruptcy filings by Steven McKinlay and outstanding liens against the defendants, using investor funds to pay back some of the other investors in a "Ponzi" scheme, and using investor money for personal use. The defendants are accused of spending investors' money on $10,000 a month rent for a San Clemente home and $7,000 a month rent for a Coto de Caza home, paying for their daughter's wedding, purchasing a luxury suite at the Los Angeles Angels of Anaheim Stadium, purchasing cars, and paying off old debts and day-to-day expenses.  They are accused of using investors' money to donate $50,000 to their church. The defendants are also accused putting their relatives and their friends' relatives on GSC payroll. 
This case was investigated by the Orange County District Attorney (OCDA) Bureau of Investigations after receiving a complaint from a whistleblower. Several victims were unaware that their investments had been defrauded until being contacted by the OCDA during the course of the investigation. The defendants were arrested on Dec. 16, 2015, by OCDA Investigators, with the assistance of the Orange County Sheriff's Department.
Anyone with additional information or who believes they have been a victim is encouraged to contact Supervising District Attorney Investigator Damon Tucker (714) 648-3615.
Deputy District Attorney Michelle Lipton of the Major Fraud Unit is prosecuting this case