OWNER, EXECUTIVES AND BCI AIRCRAFT LEASING INC., ALL CONVICTED OF FRAUD

The following excerpt is from the Securities and Exchange Commission website:
March 20, 2012
The Securities and Exchange Commission (“Commission”) announced that on March 14, 2012, a federal jury convicted Brian Hollnagel and BCI Aircraft Leasing Inc. on seven criminal counts, including fraud and obstruction charges for engaging in a fraudulent financing scheme that raised more than $50 million from investors and lenders. Brian Hollnagel, 38, of Chicago, the owner, president, and chief executive officer of BCI Aircraft Leasing Inc., and the corporation itself were each convicted of six counts of wire fraud and one count of obstruction of justice for obstructing the Commission’s 2007 lawsuit against them. As part of this verdict, Hollnagel and BCI were convicted of committing fraud and obstruction in connection with the provision of fraudulent court-ordered accountings of investor LLCs to the SEC during that litigation. U.S. v. Brian Hollnagel et al., Criminal Action No. 1:10-cr-0195 (N.D. Ill.) (St. Eve., J.).

On August 13, 2007, the Commission filed a civil injunctive complaint alleging that Defendants Hollnagel and BCI, from approximately 1998 through 2007, raised at least $82 million from approximately 120 investors as part of a fraudulent scheme in which the Defendants commingled investor funds, used investor funds to pay other investors, and failed to use investor funds as represented. The Complaint alleged that, as a result of their conduct, the Defendants violated Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The Commission’s action remains pending.