Facing trial for thirty-eight counts of securities fraud, conspiracy, and grand theft, a California man agreed to plead guilty to running a $3 million Ponzi scheme that counted a former mayor as its victims. Glenn Kane Jackson, 46, agreed to plead guilty to twenty-seven counts of securities fraud and grand theft just as jury selection was set to commence. Jackson's wife, Gina McGee, had previously pled guilty and served a short stint in prison before being released. Jackson was facing a maximum sentence of thirty years had he lost at trial, but with the plea deal, he could be free by the end of the year with credit for time served and good behavior.
Jackson and his wife operated several entities under the Highlands Capital name, telling investors they could deliver lucrative returns through a foreign-currency trading operation that carried little risk. Jackson befriended investors by describing himself as a former Navy Seal, and also relied on recruiting efforts by Kirk Hanson, a former mayor of Tiburon, California. In total, the pair took in more than $4 million from investors.
However, Highlands Capital was not operating a profitable forex trading operation; to the contrary, Jackson racked up over $1.6 million in trading losses. Investors were not told that the state of Wisconsin had ordered Jackson to cease-and-desist the sale of securities, or that Jackson had been fired from a previous job for misuse of company funds. Nor was Jackson a former Navy Seal - rather, he had failed basic training and was involuntarily disenrolled. Instead, the pair operated a Ponzi scheme, using new investor funds to pay returns to existing investors, in an attempt to show profitability. The couple also used investor funds to support a lavish lifestyle that included luxury travel, casinos, vehicles, clothing, jewelry, spas and dermatology treatments.
More than $2 million remains unaccounted for.