Fugitive Raleigh banker surrenders in alleged Ponzi scheme
Posted April 17, 2012 3:27 p.m. EDT
Updated April 17, 2012 6:26 p.m. EDT
Raleigh, N.C. — After three years on the run, a former Raleigh banker surrendered late Monday to federal authorities in San Francisco on charges that he ran a Ponzi scheme that bilked investors out of more than $75 million.
William Wise, 62, was indicted last month on 12 counts of mail fraud, three counts of wire fraud and one count each of money laundering and conspiracy to commit fraud.
Wise 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 federal authorities allege it was a front for a Ponzi scheme. The indictment charges that Millennium promised investors a 16 percent return on certificates of deposit, but Wise and a California woman used investors' money to repay earlier investors and fund lavish lifestyles for themselves.
The indictment alleges that Millennium sold close to $130 million in the fraudulent certificates of deposit between January 2004 and March 2009, and that investors lost more than $75 million.
In an interview with The Star newspaper in Toronto before his surrender, Wise said he was "prepared to take my lumps" in facing the charges.
"I’ve helped cause a lot of pain. Regardless of whether it was my intention or not, the result has been horrendous, horrific,” he said.
A receiver appointed by the court 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 an 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.
“We were living very well because we wanted to keep up appearances,” Wise told The Star. “Because we were such a small bank, it was very important that people felt comfortable.”
He said the stock market crash in 2008 prompted the decision to "borrow money" from investors to shore up the bank's finances. At the time, he said, he didn't feel any guilt over the move.
"I wasn’t dealing day to day with the people,” he said. “You lose sight of reality and lose touch. It’s just the reality. I wasn’t hearing the voices.”
A native of Canada, Wise disappeared in 2009, and authorities searched for him from Florida to Canada. His wife and son returned to Canada after U.S. authorities forced the sale of their luxury home in west Raleigh to recover cash lost in the alleged scheme.
He denied that he was in hiding, telling The Star that he has been living under his own name in the Toronto area.
Wise was ordered to pay more than $75 million to investors after failing to respond to a civil suit over the alleged scheme. His assets were seized and auctioned off to help repay investors.
“I don’t have billions squirreled away,” he told the newspaper. “I don’t have thousands squirreled away. I don’t even have hundreds of dollars squirreled away.”