Jury convicts former Tigard resident for defrauding investors
A federal jury in Portland has returned guilty verdicts against Harry Dean Proudfoot III, 78, formerly of Tigard, for running a fraudulent gold mining investment scheme that he used to steal $3.2 million from 140 investors.
Proudfoot was convicted Wednesday, Dec. 12, of conspiracy to commit wire fraud, wire fraud, conspiracy to commit money laundering and money laundering.
Proudfoot faces a maximum sentence of 20 years in prison, a $250,000 fine and three years' supervised release on each count of wire fraud and 10 years in prison, a $250,000 fine and three years' supervised release on each count of money laundering.
He will be sentenced on April 3 before U.S. District Court Judge Michael H. Simon.
"Harry Proudfoot and his children made many promises to their investors — promises they never intended to fulfill," said Billy J. Williams, U.S. Attorney for the District of Oregon. "They now join a long list of financial criminals whose schemes were cut short by diligent investigators working on behalf of victims. Pursuing criminals who prey on unknowing investors is a top priority for federal law enforcement in Oregon."
According to court documents and information shared at trial, Proudfoot created 3 Eagles Research and Development in 2008, a company based in Tigard that he used from 2008 through 2012 to solicit investors for a purported gold-mining operation in Ohio. Proudfoot — along with his adult children, including co-defendant Matthew Proudfoot — falsely promised to use investors' money to purchase mining equipment and to conduct mining operations at two gravel pits in Ohio.
To entice investors, Proudfoot and his children offered high rates of return, typically 10 percent of gross revenues, payable once the mine became operational, investigators said. They falsely told investors they had all the necessary legal and business requirements in place for the mining operation.
In 2011, the states of Washington and Colorado and the U.S. Securities and Exchange Commission began investigating the group for securities violations. Ultimately, the U.S. District Court for the District of Oregon entered a judgment against Harry Proudfoot, Matthew Proudfoot and the 3 Eagles Research and Development Company in the SEC enforcement action.
Co-defendant Matthew Proudfoot pleaded guilty to wire fraud and money laundering on Nov. 1. He will be sentenced on Jan. 9.
The case was investigated by the FBI and IRS-Criminal Investigation, and prosecuted by Scott E. Bradford and John C. Brassell, assistant U.S. attorneys for the District of Oregon.