Man allegedly operated fraudulent company out of Sandusky

SANDUSKY — Police arrested a man in Cleveland Tuesday for allegedly running a Sandusky-based real estate firm in that defrauded investors of more than $10 million.Jared Davis, a former Columbus-area resident who resides in Montana, was indicted May 1 in Toledo's U.S. District Court on 19 charges, including wire fraud, money laundering and obstruction of justice, according to a news release from the U.S. Attorney's Office.The indictment alleges Davis owned Erie Marketing LLC in Sandusky, which was involved in "real estate ventures," the release states.The indictment did not indicate where Erie Marketing LLC was located. The business was not registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission, which provide regulatory oversight, the report states.Davis offered "binary options" investment through the business. "Binary options" is a concept where an investor seeks a future payout based on the future price of a security or commodity, according to the release.Binary options can be traded on regulated exchanges that match two investors — one who thinks the price of an asset will increase with another who thinks it will decrease, the release states.Davis allegedly acted as a broker and did not connect investors to a legitimate binary options exchange — rather, he allegedly took the opposing position on each investor's trade, according to the release.Thus, he only made money when investors lost money, allegedly providing an incentive to deceive victims by not matching them with individual investors and not disclosing that to them, the release states.Davis allegedly solicited victims through internet marketing campaigns and call centers out of Sandusky, Costa Rica and St. Maarten, and allegedly employed foreign nationals in an "elaborate web" of foreign business he created in the United Kingdom, Belize, Anguilla, Costa Rica and St. Maarten to allegedly launder victims' deposits, the release states."This defendant portrayed himself as a legitimate investment broker when he was really no better than a simple con man," first assistant U.S. attorney David Sierleja said. "He fleeced victims out of $10 million by manipulating trade conditions, falsely telling investors his salespeople were financial analysts and using offshore companies to spend money as fast as it came in."The case was investigated by the FBI and the IRS investigation division and will be prosecuted by U.S. Attorney Gene Crawford.Reach reporter Brandon Addeo at brandonaddeo@sanduskyregister.com, follow him on Twitter @BrandonAddeo and follow the Register at Facebook.com/SanduskyRegisterThis photo taken Aug. 19, 2015 shows the The Internal Revenue Service (IRS) Building in Washington. (AP Photo/Andrew Harnik)