Amway - Alan R Keranen
Land Investment Fraud

200+ people, 95% Amway, lost $12 million in a scam run by then time 28 month Amway Diamond Distributor Al Keranen. Al was originally in World Wide Dream Builders. He was in a group of 6 that split off to form IED. IED changed its name to INA when Al was about to go to prison. Keranen was kicked out of Amway and served about two years in prison. Al has paid back to date only $148K to investors of the $12 million stolen, despite bragging on a website that he has made over $18 million in Multi-level-marketing.

 
Amagram Dec. 1983

By John Polich, Los Angeles Daily News, Sunday June 24, 1990 Original article

Los Angeles - A man charged with masterminding one of the largest fraud schemes ever in the San Fernando Valley lured investors with flashy jewelry, a spacious home and an appeal to old-fashioned religious values, former clients say.

Alan R. Keranen, founder and president of the now-defunct California Anchor Group Inc., entertained prospective clients to a $1.2 million hillside home complete with tennis courts and stable of expensive cars, the investors said.

Some investors, who include Santa Barbara County residents, were presented seminars and cassette tape in which Keranen described his rags-to-riches rise and told of being "born again" to traditional Christian beliefs, they say.

But Keranen never told potential investors that he was using the appearance of personal wealth to sell them worthless or non-existent real estate, federal prosecutors said.

Among other offerings, the Anchor Group's portfolio included land it didn't own and dubious development projects that never turned a profit, according to and indictment in the case.

Keranen, 42 who now lives in Oregon, has agreed to plead guilty to mail and bank fraud charges in a $12 million investment scheme that federal officials claim swindled at least 200 people, his layer said. Two other Anchor Group executives have been indicted on fraud charges.

"They had the big cars, and the jewelry and the Rolexes, but they were just talking about the money," said Gerhard Paul, a Goleta resident who lost his entire investment in an Anchor Group venture. "They never really produced anything. They seemed like trustworthy people. I know that's how I felt"

Defense lawyer Richard Kirschner said that the Keranen decided to plead guilty because he wants to take full responsibility for the lost investments. He denied that Keranen intended to steal the investors' money as part of a well-planned criminal scheme. (Al has paid back to date only $148K to investors of the 12 million stolen from investors.)

The hopes, certainly Al Keranen's hopes, were grander than his capabilities, "Kirschner said. "This wasn't a cleaver, Machiavellian plot"

Kirschner said Keranen will plead guilty to a four-count criminal complaint charging that he mailed fraudulent investment information to clients and made false statement on two bank loan applications.

Keranen has not agreed to any specific sentence, but has pledged to make restitution to the victims, Kirschner said. The charges carry a maximum penalty of 14 years in federal prison.

The two defendants, Robert M. Dumas, 36 of Simi Valley, and Ronald Stollar, 37, of Westlake Village, bother former vice presidents of Anchor Group, are charged in a 31-count indictment with bank fraud, mail fraud and interstate transportation of money obtained in the fraud scheme.

They face maximum sentences of from two to 10 years in prison per count.

All three men are scheduled to be arraigned Monday in federal court in Los Angeles.

According to the court documents, Keranen and the other defendants solicited real estate investments through joint ventures, individual retirement accounts and other devices.

Keranen was introduced to most of his clients through contacts he made as a prominent West Coast distributor of Amway products, the indictment said. Amway was in no way implicated in the scheme, federal prosecutors said.

Assistant U.S. Attorney Anita Dyman, the prosecutor in the case, said Keranen and the other defendant told investors that their money would be pooled with that o f other clients and used to buy and develop land.

The investors were promised an annual return of from 12 to 30 percent and profits of up to 100 percent when the land was sold, she said.

But very little of the investor's' money ever was spent on real estate deal. Instead, Keranen diverted the invested funds to pay the operating costs of the company and his own personal expenses, as well as interest due on money invested by previous clients, Dyman said.