Facts

Thomas Alexander sued Incway Corp., Companies Inc. (CI), Presidential Services Inc. (PSI), Kevin Wessell, Casey Lawrence, Matt Mitchell, and several others alleging fraud and Racketeer Influenced and Corrupt Organizations (RICO) violation.

Incway did business in California as CI. Alexander was a real estate agent in Alaska who contacted CI in 2009, considering opening an offshore account. The individual defendants were associated with CI.

PLAINTIFF'S CONTENTIONS:
Plaintiff lacked knowledge about offshore accounts, and relied on defendants' expertise in opening up an offshore account. Defendant Wessell recommended that plaintiff deposit his money in The Alps, a Swedish financial institution. Although plaintiff had never heard of The Alps before, he was convinced after he received an impressive package from Wessell purporting to have been copyrighted by Wessell and PSI. Plaintiff then proceeded to invest his money in The Alps. Unbeknownst to plaintiff, Wessell and defendant Mitchell were actually directors of the Alps. Defendants also did not advise plaintiff that the money he was depositing would actually be used to make real estate investments in Washington. Plaintiff wired a total of approximately $525,000 in funds to The Alps beginning in 2009. In 2011, he attempted to withdraw money from the account, but his balance showed that the money had been withdrawn. Plaintiff never recovered any portion of the funds he "deposited" and spent close to $175,000 in attorney fees and costs to get it back. Plaintiff contended that The Alps was a sham.

Result

The court concluded that defendants had committed fraud through intentional and negligent misrepresentation and concealment and suppression of facts. The court found that the individual defendants willfully participated in RICO violation. As such, the court found Alexander entitled to damages and awarded $524,785 in actual damages against all defendants, plus prejudgment interest, and $1,574.355 in RICO treble damages. The court also found Wessell and his alter ego corporations liable for punitive damages in the amount of $2 million, as an alternative to $1.5 million in RICO treble damages.