Australian Pleads Guilty to Fraud in Orange County Precious Metal Sales Schemes

A 40-year-old Australian national, characterized by a federal prosecutor as “one of the more notorious of the boiler-room salesmen” in the nation, pleaded guilty Monday in Los Angeles federal court to two counts of mail fraud stemming from two separate precious metals sales schemes.

James G. Eglitis, an account executive at a Newport Beach telephone marketing operation called Intech Investment Corp., was indicted last November on 32 counts of mail fraud and interstate transportation of stolen property.

Eglitis subsequently pleaded not guilty to those charges and was scheduled to go to trial today, according to Terree Bowers, chief of the major fraud division of the U.S. attorney’s office.

But he changed his plea Monday before Chief U.S. District Judge Manuel L. Real, Bowers said, after federal prosecutors filed additional charges against him in relation to a second telemarketing scheme, an operation called California Mint with offices in Huntington Beach and Santa Ana.

“Because he is pleading (guilty) to mail fraud counts in both cases, we have agreed to dismiss the remaining counts in the Intech case,” Bowers said. “Now he is exposed to (a possible sentence of) 10 years in prison and a $500,000 fine.”

Eglitis, whose place of residence is unknown, has been held at Terminal Island federal prison since his arrest in the Intech scheme in November. Intech operated from late 1984 until early 1986 and bilked an estimated 400 victims out of about $2 million.

According to the indictment, clients from across the country sent the company checks and precious metals to open credit accounts for buying gold, silver, platinum and copper. Intech telephone salesmen promised clients profits of up to 625% and told them that there was little or no risk of losing money, according to authorities. But when clients tried to close their accounts, Intech allegedly failed to refund their money, the indictment said.

Bowers said California Mint, which Eglitis allegedly ran on his own, operated in a similar fashion.

“Eglitis spent 14 years in the Australian navy as a radar plotter,” Bowers said. “He came to the United States in 1983 and immediately got involved in boiler-room activity. Since that time, he has bounced from one boiler-room to the next in four different states and has scammed investors throughout the nation.”

Also Investigated by FBI

Eglitis is scheduled to be sentenced on March 7. He is also under investigation by the FBI in Chicago for operating another telemarketing scheme called Whitehall Commodities, said Kacy R. McClelland, a postal investigator involved in the case.

Indicted along with Eglitis in the Intech case were Mark E. Rattet, 29, Los Angeles; Matthew A. Valentine, 27, Newport Beach; Richard R. Johnson, 30, Huntington Beach; Robert J. Canfield, 31, Fountain Valley, and Marc H. Guest, 30, Costa Mesa.

Rattet pleaded guilty to two counts of mail fraud; Valentine pleaded guilty to five counts of mail fraud and interstate transportation of stolen property, and Johnson pleaded guilty to one count of mail fraud and one count of conspiracy to commit mail fraud, authorities said. All three men are scheduled to be sentenced later this month.

Authorities have dropped charges against Canfield and Guest but said they plan to refile in the future.