LOS ANGELES — Financial talk show host R. G. Reynolds was found guilty on Thursday of 13 counts of mail fraud and two counts of witness tampering.
A five-woman, seven-man federal jury took less than four hours to conclude that Reynolds had duped fans of his radio and television shows into investing in schemes that were intended to enrich Reynolds but held little promise of any returns to investors. He now heads a Laguna Niguel company, Flow-Ventures.
"The evidence was overwhelming," Special U.S. Atty. Peter Morris said. "Justice was done."
Reynolds, 44, remained stoic as the verdicts were read. He later said he would appeal "all the way to the Supreme Court, if necessary."
The bearded talk show host, who remains in custody pending a bail hearing Tuesday, faces a maximum prison sentence of 85 years and up to $3.75 million in fines. He is to be sentenced Dec. 2.
Federal prosecutors presented evidence on the "managed account" blind pool investment program that Reynolds ran from 1985 to 1987 through his now-defunct Burbank company, R. G. Reynolds Enterprises.
Touting himself as a financial expert and self-made millionaire, Reynolds--who has no formal education--lured more than 70 mostly inexperienced investors into placing a total of nearly $1 million in the managed account program by promising them returns ranging from 48% to 1,000%, prosecutors said.
Reynolds would then send investors phony account statements saying they were earning high returns, but he actually spent most of the money to pay business and personal expenses, prosecutors said.
He owns a home in Laguna Niguel valued at more than $700,000. Most investors never received any profit from the program, they said, and many are still trying to get their original investments back.
The investment program "was a complete fraud," Morris said. "He never intended to pay the managed account people back."
The two witness-tampering charges involved taped phone conversations during which Reynolds allegedly urged a witness to destroy a telegram referring to a nonexistent Swiss bank account.
A former Florida insurance salesman with no formal education, Reynolds moved to California in the early 1980s after a string of arrests on bad-check charges and allegations that he had pocketed insurance premiums.
Reynolds began buying time on radio and television stations and by the mid-1980s, had become a popular local figure.
But in 1987, federal postal inspectors raided Reynolds' offices and shut his business down. The Securities and Exchange Commission obtained a civil judgment against Reynolds in 1989 for securities laws violations, and Reynolds was ordered to repay investors $5.7 million, plus interest. Reynolds has appealed that decision and has filed for personal bankruptcy liquidation.