Frank Vennes
Encyclopedia
Frank Elroy Vennes Jr. is an American multimillionaire and convicted money launderer
. He was the primary fundraiser for Tom Petters
, who was convicted of organizing a $3.5 billion Ponzi scheme
in Minnesota
. Vennes was previously convicted on federal charges of money laundering, illegal firearm sales and cocaine distribution in 1987. He experienced a religious transformation while incarcerated and became a major political contributor and business leader after his release in 1990. Vennes' homes were raided by federal agents in connection with the Petters Ponzi scheme in 2010. In July 2011, he was charged with eight counts of securities fraud
, six counts of wire fraud
, three counts of money laundering, three counts of bank fraud
, and two counts of mail fraud.
. He delivered newspapers and was a janitor before he attended the University of North Dakota
.
He is CEO of Minnesota businesses Metro Capital, Metro Gold, Metro Gem and Resort Ventures as well as being officer for seven Florida companies, including Metro Riverwatch. He is a former board member of Minnesota Teen Challenge
.
A resident of Stuart, Florida
, Vennes owns homes in Shorewood, Minnesota
and Jupiter, Florida
.
agents investigating suspected money laundering
by certain North Dakota car dealers were informed that Vennes, the owner of a pawnshop
in Bismarck, North Dakota
, had visited Switzerland
multiple times and might have experience transferring funds to foreign countries.
Vennes was approached by an undercover IRS agent posing as an investor from Chicago in 1986. He received $370,000 from the agent over the next three months and transferred the funds to offshore accounts
in Switzerland, the Isle of Man
and the Bahamas
. In one transaction, Vennes personally delivered $100,000 to Switzerland. Vennes alleged that his associates had either stolen or lost the $100,000.
Vennes was charged in three indictments in May 1987. He was convicted on federal charges of illegal firearm sales, money laundering and cocaine
distribution. He pleaded guilty to the money laundering charge and no contest
to the other charges. He was sentenced to five years in federal prison, and served three at the Federal Correctional Institution, Sandstone
.
While in prison, Vennes experienced a religious conversion. He was released in 1990 and filed a petition for a pardon. Vennes also filed a suit against IRS, alleging that he had been a victim of entrapment
.
and Congresswoman Michele Bachmann
. In 2006, he and his family were the top contributors to Bachmann's campaign.
In 2007, Bachmann sent a letter to then-President George W. Bush
, recommending that Vennes be pardon
ed for his crimes. She later withdrew her letter after Vennes' home was raided by federal agents in connection with the Petters Ponzi scheme.
home was raided by federal agents in connection with an investigation of Minnesota businessman Tom Petters
' $3.5 billion Ponzi scheme
. In a basement vault, agents discovered stacks of $100 bills, buckets and boxes of gold and silver coins, boxes of gem stones, trays of jewelry and Rolex
watches.
In April 2011, Vennes was indicted in federal court on charges of fraudulently marketing a hedge fund
’s investments in Petters Company, Inc. (PCI). The indictment alleged that Vennes engaged in 748 transactions involving hundreds of millions of dollars from 1999 through September 2008, and made more than $140 million through investments and commissions. On July 19, 2011, Vennes was charged with eight counts of securities fraud
, six counts of wire fraud
, three counts of money laundering, two counts of mail fraud, three counts of bank fraud
, and two counts of making false statements on credit applications.
Money laundering
Money laundering is the process of disguising illegal sources of money so that it looks like it came from legal sources. The methods by which money may be laundered are varied and can range in sophistication. Many regulatory and governmental authorities quote estimates each year for the amount...
. He was the primary fundraiser for Tom Petters
Tom Petters
Thomas Joseph Petters is an American business man and the former CEO and chairman of Petters Group Worldwide. Petters resigned his position as CEO on September 29, 2008, amid mounting criminal investigations...
, who was convicted of organizing a $3.5 billion Ponzi scheme
Ponzi scheme
A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from any actual profit earned by the individual or organization running the operation...
in Minnesota
Minnesota
Minnesota is a U.S. state located in the Midwestern United States. The twelfth largest state of the U.S., it is the twenty-first most populous, with 5.3 million residents. Minnesota was carved out of the eastern half of the Minnesota Territory and admitted to the Union as the thirty-second state...
. Vennes was previously convicted on federal charges of money laundering, illegal firearm sales and cocaine distribution in 1987. He experienced a religious transformation while incarcerated and became a major political contributor and business leader after his release in 1990. Vennes' homes were raided by federal agents in connection with the Petters Ponzi scheme in 2010. In July 2011, he was charged with eight counts of securities fraud
Securities fraud
Securities fraud, also known as stock fraud and investment fraud, is a practice that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in losses, in violation of the securities laws....
, six counts of wire fraud
Wire fraud
Mail and wire fraud is a federal crime in the United States. Together, 18 U.S.C. §§ 1341, 1343, and 1346 reach any fraudulent scheme or artifice to intentionally deprive another of property or honest services with a nexus to mail or wire communication....
, three counts of money laundering, three counts of bank fraud
Bank fraud
Bank fraud is the use of fraudulent means to obtain money, assets, or other property owned or held by a financial institution, or to obtain money from depositors by fraudulently representing to be a bank or financial institution. In many instances, bank fraud is a criminal offense...
, and two counts of mail fraud.
Biography
Vennes grew up in a small town in North DakotaNorth Dakota
North Dakota is a state located in the Midwestern region of the United States of America, along the Canadian border. The state is bordered by Canada to the north, Minnesota to the east, South Dakota to the south and Montana to the west. North Dakota is the 19th-largest state by area in the U.S....
. He delivered newspapers and was a janitor before he attended the University of North Dakota
University of North Dakota
The University of North Dakota is a public university in Grand Forks, North Dakota, USA. Established by the Dakota Territorial Assembly in 1883, six years before the establishment of the state of North Dakota, UND is the oldest and largest university in the state and enrolls over 14,000 students. ...
.
He is CEO of Minnesota businesses Metro Capital, Metro Gold, Metro Gem and Resort Ventures as well as being officer for seven Florida companies, including Metro Riverwatch. He is a former board member of Minnesota Teen Challenge
Teen Challenge
Teen Challenge is a Pentecostal Christian recovery program and a network of Christian social and evangelizing work centers. It is a 12-18 month program that serves drug addicts, alcoholics, gang members, prostitutes and people with other characteristics that the program considers to be...
.
A resident of Stuart, Florida
Stuart, Florida
Stuart is the only incorporated city of Martin County, Florida, on Florida's Treasure Coast. The population was 14,633 at the 2000 census. As of 2007, the population recorded by the U.S. Census Bureau is 15,964....
, Vennes owns homes in Shorewood, Minnesota
Shorewood, Minnesota
Shorewood is a settlement on Lake Minnetonka in Hennepin County, Minnesota, United States. The population was 7,307 at the 2010 census. The city was incorporated in 1956. Its area was originally part of the larger Excelsior Township as were the nearby cities of Excelsior, Tonka Bay and Deephaven...
and Jupiter, Florida
Jupiter, Florida
Jupiter is a town located in Palm Beach County, Florida. As of the 2000 census, the town had a total population of 39,328. The estimate population for 2009 is 50,606. As of 2006, the population had grown to 50,028, according to the University of Florida, Bureau of Economic and Business Research....
.
Money laundering conviction
Internal Revenue ServiceInternal Revenue Service
The Internal Revenue Service is the revenue service of the United States federal government. The agency is a bureau of the Department of the Treasury, and is under the immediate direction of the Commissioner of Internal Revenue...
agents investigating suspected money laundering
Money laundering
Money laundering is the process of disguising illegal sources of money so that it looks like it came from legal sources. The methods by which money may be laundered are varied and can range in sophistication. Many regulatory and governmental authorities quote estimates each year for the amount...
by certain North Dakota car dealers were informed that Vennes, the owner of a pawnshop
Pawnbroker
A pawnbroker is an individual or business that offers secured loans to people, with items of personal property used as collateral...
in Bismarck, North Dakota
Bismarck, North Dakota
Bismarck is the capital of the U.S. state of North Dakota and the county seat of Burleigh County. It is the second most populous city in North Dakota after Fargo. The city's population was 61,272 at the 2010 census, while its metropolitan population was 108,779...
, had visited Switzerland
Switzerland
Switzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....
multiple times and might have experience transferring funds to foreign countries.
Vennes was approached by an undercover IRS agent posing as an investor from Chicago in 1986. He received $370,000 from the agent over the next three months and transferred the funds to offshore accounts
Offshore bank
An offshore bank is a bank located outside the country of residence of the depositor, typically in a low tax jurisdiction that provides financial and legal advantages. These advantages typically include:...
in Switzerland, the Isle of Man
Isle of Man
The Isle of Man , otherwise known simply as Mann , is a self-governing British Crown Dependency, located in the Irish Sea between the islands of Great Britain and Ireland, within the British Isles. The head of state is Queen Elizabeth II, who holds the title of Lord of Mann. The Lord of Mann is...
and the Bahamas
The Bahamas
The Bahamas , officially the Commonwealth of the Bahamas, is a nation consisting of 29 islands, 661 cays, and 2,387 islets . It is located in the Atlantic Ocean north of Cuba and Hispaniola , northwest of the Turks and Caicos Islands, and southeast of the United States...
. In one transaction, Vennes personally delivered $100,000 to Switzerland. Vennes alleged that his associates had either stolen or lost the $100,000.
Vennes was charged in three indictments in May 1987. He was convicted on federal charges of illegal firearm sales, money laundering and cocaine
Cocaine
Cocaine is a crystalline tropane alkaloid that is obtained from the leaves of the coca plant. The name comes from "coca" in addition to the alkaloid suffix -ine, forming cocaine. It is a stimulant of the central nervous system, an appetite suppressant, and a topical anesthetic...
distribution. He pleaded guilty to the money laundering charge and no contest
Nolo contendere
is a legal term that comes from the Latin for "I do not wish to contend." It is also referred to as a plea of no contest.In criminal trials, and in some common law jurisdictions, it is a plea where the defendant neither admits nor disputes a charge, serving as an alternative to a pleading of...
to the other charges. He was sentenced to five years in federal prison, and served three at the Federal Correctional Institution, Sandstone
Federal Correctional Institution, Sandstone
The Federal Correctional Institution in Sandstone, Minnesota, is a low security prison for male offenders.FCI Sandstone is situated about 100 miles northeast of Minneapolis/St...
.
While in prison, Vennes experienced a religious conversion. He was released in 1990 and filed a petition for a pardon. Vennes also filed a suit against IRS, alleging that he had been a victim of entrapment
Entrapment
In criminal law, entrapment is conduct by a law enforcement agent inducing a person to commit an offense that the person would otherwise have been unlikely to commit. In many jurisdictions, entrapment is a possible defense against criminal liability...
.
Political contributions
Vennes has been a major financial contributor to the campaigns of former Minnesota Governor Tim PawlentyTim Pawlenty
Timothy James "Tim" Pawlenty , also known affectionately among supporters as T-Paw, is an American politician who served as the 39th Governor of Minnesota . He was a Republican candidate for President of the United States in the 2012 election from May to August 2011...
and Congresswoman Michele Bachmann
Michele Bachmann
Michele Marie Bachmann is a Republican member of the United States House of Representatives, representing , a post she has held since 2007. The district includes several of the northern suburbs of the Twin Cities, such as Woodbury, and Blaine as well as Stillwater and St. Cloud.She is currently a...
. In 2006, he and his family were the top contributors to Bachmann's campaign.
In 2007, Bachmann sent a letter to then-President George W. Bush
George W. Bush
George Walker Bush is an American politician who served as the 43rd President of the United States, from 2001 to 2009. Before that, he was the 46th Governor of Texas, having served from 1995 to 2000....
, recommending that Vennes be pardon
Pardon
Clemency means the forgiveness of a crime or the cancellation of the penalty associated with it. It is a general concept that encompasses several related procedures: pardoning, commutation, remission and reprieves...
ed for his crimes. She later withdrew her letter after Vennes' home was raided by federal agents in connection with the Petters Ponzi scheme.
Tom Petters Ponzi scheme
On September 24, 2010, Vennes' Shorewood, MinnesotaShorewood, Minnesota
Shorewood is a settlement on Lake Minnetonka in Hennepin County, Minnesota, United States. The population was 7,307 at the 2010 census. The city was incorporated in 1956. Its area was originally part of the larger Excelsior Township as were the nearby cities of Excelsior, Tonka Bay and Deephaven...
home was raided by federal agents in connection with an investigation of Minnesota businessman Tom Petters
Tom Petters
Thomas Joseph Petters is an American business man and the former CEO and chairman of Petters Group Worldwide. Petters resigned his position as CEO on September 29, 2008, amid mounting criminal investigations...
' $3.5 billion Ponzi scheme
Ponzi scheme
A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from any actual profit earned by the individual or organization running the operation...
. In a basement vault, agents discovered stacks of $100 bills, buckets and boxes of gold and silver coins, boxes of gem stones, trays of jewelry and Rolex
Rolex
Rolex SA is a Swiss watchmaking manufacturer of high-quality, luxury wristwatches. Rolex watches are popularly regarded as status symbols and BusinessWeek magazine ranks Rolex No.71 on its 2007 annual list of the 100 most valuable global brands...
watches.
In April 2011, Vennes was indicted in federal court on charges of fraudulently marketing a hedge fund
Hedge fund
A hedge fund is a private pool of capital actively managed by an investment adviser. Hedge funds are only open for investment to a limited number of accredited or qualified investors who meet criteria set by regulators. These investors can be institutions, such as pension funds, university...
’s investments in Petters Company, Inc. (PCI). The indictment alleged that Vennes engaged in 748 transactions involving hundreds of millions of dollars from 1999 through September 2008, and made more than $140 million through investments and commissions. On July 19, 2011, Vennes was charged with eight counts of securities fraud
Securities fraud
Securities fraud, also known as stock fraud and investment fraud, is a practice that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in losses, in violation of the securities laws....
, six counts of wire fraud
Wire fraud
Mail and wire fraud is a federal crime in the United States. Together, 18 U.S.C. §§ 1341, 1343, and 1346 reach any fraudulent scheme or artifice to intentionally deprive another of property or honest services with a nexus to mail or wire communication....
, three counts of money laundering, two counts of mail fraud, three counts of bank fraud
Bank fraud
Bank fraud is the use of fraudulent means to obtain money, assets, or other property owned or held by a financial institution, or to obtain money from depositors by fraudulently representing to be a bank or financial institution. In many instances, bank fraud is a criminal offense...
, and two counts of making false statements on credit applications.