Ponzi scheme nets former Raleigh banker 21-year sentence
Posted February 6, 2015
Updated February 9, 2015
San Francisco — A former Raleigh banker who ran a Ponzi scheme that bilked investors out of more than $75 million has been sentenced to more than 21 years in federal prison.
A judge will decide in April how much William Wise should have to repay his victims.
Wise, 63, operated Millennium Bank from a west Raleigh office. He billed it as a unit of a Swiss bank based on the Caribbean island of St. Vincent, but he later admitted it was merely a front for a Ponzi scheme. Millennium promised investors a 16 percent return on certificates of deposit, but Wise and co-defendant Jacqueline Hoegel used investors' money to repay earlier investors and fund lavish lifestyles for themselves.
The Ponzi scheme ran from 1999 to late March 2009. Wise admitted that, from January 2004 to March 2009 alone, he and Hoegel sold more than $129.5 million worth of bogus CDs to more than 1,200 investors, resulting in losses of more than $75 million.
A receiver appointed by a federal court in Texas in 2009 to review Millennium's books found that Wise gave his wife a $12,000 weekly allowance and spent $6,000 to $10,000 a month each for his girlfriends, $1 million on wine, $800,000 to build a hangar in Atlanta for a corporate jet, $450,000 for three boats and an undetermined sum for a 2008 New Year's Eve party for 50 people on St. Vincent.
Wise was on the run for three years before surrendering to federal authorities in San Francisco in 2012. He pleaded guilty to 12 counts of mail fraud, three counts of wire fraud and one count each of money laundering and conspiracy to commit fraud.
Federal agents seized Wise's possessions in 2009 and auctioned them off to generate money to repay investors. As part of his plea agreement, Wise worked with the receiver to obtain control over any remaining investor funds in bank accounts in the U.S. and foreign countries.
Upon his release from prison, Wise won't be allowed to assume a position of fiduciary trust without approval from his probation officer. He also will be required to set up a payment schedule with the IRS for the estimated $1 million in taxes he owes from his unreported earnings.