HOUSTON (CN) – A man who posed as a concert promoter and scammed 18 investors out of $2.5 million for a fictitious Texas Musical Festival was sentenced to 5 years in federal prison. He was on supervised release after running an identical scam 9 years ago in California.
James Watson, 55, was indicted in May 2010 and pleaded guilty in November to a superseding information charging him with conspiracy to commit bank fraud. Watson admitted he kited a $400,000 check to Bank of America as part of the music festival scheme, prosecutors said in a statement.
The superseding information alleged Watson lied to investors, including a 92-year-old woman, about the festival, which was to be held in Houston from Aug. 30 to Sept. 1, 2008.
“In reality, Watson had an extensive criminal history and was on federal supervised release after completing a prison term imposed following a 2002 conviction in the Eastern District of California for engaging in essentially the same scam related to the Sacramento Jazz Festival in California,” prosecutors said.
“Watson falsely told investors that a charity would be holding the ticket receipts for the concert and promised investors not only return of their investment, but a substantial profit.
“In actuality, Watson siphoned investor funds to bankroll an extravagant lifestyle, withdrew the $400,000 from Bank of America from the check kite and disappeared on what was supposed to have been the third day of the Texas Music Festival without paying the artists, vendors or police officers working the event, nor the investors,” prosecutors said.
U.S. District Judge Gray Miller also ordered Watson to pay Bank of America $391,000 in restitution.
“As a result of the Texas Music Festival scam, the District Court in the Eastern District of California revoked Watson’s term of supervised release in December 2008 and handed down a 28-month term of imprisonment and is requiring Watson to pay the balance of $399,837 in restitution to investors previously ordered,” prosecutors said.