DES MOINES (CN) - An Iowa man faces four to seven years in federal prison after pleading guilty to bilking investors out $1.1 million, prosecutors said.
John Francis Holtsinger, 52, of Ottumwa, Iowa, pleaded guilty to five counts of wire fraud and one count of tax evasion. He admitted taking the money from Iowa investors from 2005 to 2012.
"Holtsinger represented to the investors that he would put their money into investment accounts; however, he actually used most of it for personal expenses or to pay back investors whose money he had misappropriated earlier," the U.S. Attorney's Office said in a statement.
"Holtsinger admitted that he ended up exhausting all the funds he received from investors. He then attempted to conceal his fraud by falsely informing the investors that their funds had been frozen as a result of actions taken by state or federal authorities. In reality, the funds were gone."
After he was arrested in June, Holtsinger spent the money on living expenses, vacations and Internet dating sites, prosecutors said at the time.
Holtsinger admitted he tried to persuade investors to lie to law enforcement about the money they had given him.
"He instructed them to describe their payments to him as 'interest free loans,' when in reality they were investments," prosecutors said Friday. "Holtsinger also threatened that anyone who cooperated with law enforcement officers would not be repaid."
He also admitted evading taxes by moving the money to accounts under the name of his mother.
If the judge accepts the terms of his plea agreement, Holtsinger faces at least 46 months but no more than 87 months in prison, plus fines of up to $250,000 for each wire fraud count and $100,000 for tax evasion.
Sentencing is scheduled for Jan. 17, 2013.
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