http://www.post-gazette.com/pg/08102/872345-85.stmFeds ground Soaring Eagle in $2 million charity scam
Friday, April 11, 2008
By Torsten Ove, Pittsburgh Post-Gazette
In a classic "Seinfeld" episode, George Costanza creates a charity called "The Human Fund" with the slogan: "Money for People."
Robert Eugene Cheney had a charity, too, called HARP -- "Helping All Races of People."
He said it provided funding and services "to the poor throughout the world."
But his enterprise was no more real than George's, according to federal agents, who say he and a partner invented it as part of a scheme to rip off investors in Crawford County and across the country of some $2 million from 2003 through March 2007.
A federal grand jury on Tuesday indicted Mr. Cheney and Joseph Guess on 42 counts of wire fraud, money laundering and other offenses.
Mr. Cheney, 78, who represented to his clients that he was a Cherokee Indian chief, and Mr. Guess, 51, are formerly of Conneaut Lake, Crawford County. Both are due in court April 24.
FBI and IRS agents said Mr. Cheney, who now lives in Las Vegas, and Mr. Guess, who lives in Phoenix, told investors that they were affiliated with HARP and another entity called Eagle Eight Trust, which was supposed to be involved in oil production in Pennsylvania.
According to the indictment, the men offered a quick, guaranteed 100 percent return on money that was invested with them. But they never invested anything and just put it all in the bank for themselves, federal prosecutors said.
As part of the scheme, agents said, Mr. Cheney portrayed himself as the chairman of HARP and said he was known as "Chief Soaring Eagle," a high-ranking official of the "Sovereign Cherokee Nation."
He also said he was married to the sister of a Mexican government official with connections in Central and South America that allowed HARP to enter into "joint ventures" with oil companies and trade in billions of dollars of oil reserves.
Mr. Cheney wasn't always an Indian chief. Sometimes he also called himself "The Commander." For his part, Mr. Guess was "The Director" whose job was to find new investors by e-mail, the Internet and, especially in the Conneaut Lake area, word-of-mouth.
In a related scheme, agents said, Mr. Cheney represented to investors that he was a billionaire oil tycoon in Pennsylvania offering investment opportunities in Eagle Eight Trust and various oil production operations in the state.
In addition to the quick and huge returns, the men promised that the investments were risk-free and secured by "oil production reserve notes," 200,000 barrels of oil, a $62 million Barclays Bank account and other guarantees.
According to the indictment, they produced fake banking and business documents to fool investors, who are identified in the indictment only by their initials.
In reality, the indictment says, the money from investors duped in both schemes ended up in various Cheney bank accounts "for the personal benefit of the defendant and his wife, M.C."
The accounts were in his wife's name, but she has not been charged.
The investigation is continuing.
Every year the IRS sends out warnings about its "Dirty Dozen" scams to either hide income or steal from the unsuspecting, such as phishing schemes, abusive retirement plans and the like.
The agency said Mr. Cheney's machinations fit this year's list, released just last month. No. 11 for 2008 is "misuse of trusts" and No. 12 is "abuse of charitable organizations."
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