Telemarketer Pleads Guilty to Fraud

The operator of a network of precious-metals telemarketing scams in Orange County pleaded guilty Thursday to defrauding hundreds of investors of more than $7 million to help pay gambling debts.

James A. Boone, 41, of Buena Park was convicted of mail and tax fraud in connection with boiler rooms he operated in 1984-87 through the World Equity Mint company in Anaheim. He faces up to 18 years in prison and a $1-million fine.

Sentencing was scheduled Sept. 16 by U.S. District Judge Gary L. Taylor.

World Equity and affiliated companies told investors that their money was being invested in gold, silver, platinum and palladium, which would be stored for them until they wanted to sell. The companies called this the “secured layaway plan.”

But the precious metals were never purchased, and few investors received any money.

Prosecutors said the money was used to pay for boiler room operations, Boone’s gambling debts and a part-time bodyguard.

The U.S. attorney’s office said Boone was “paying approximately $100,000 to his personal bookie with investor funds (and) paying other gambling debts of at least $14,000 with client funds.” Assistant U.S. Atty. Paul L. Seave said Boone bet mostly on football.

He also invested $100,000 of investors’ money in a boating firm and for renovating his home, Seave said.

“Boiler rooms have large expenses to pay off, things like sales commissions to the salespeople, rent, telephone bills,” he said.

Boone concealed his efforts, prosecutors said, by creating sham transactions with local coin shops to make it appear that he had bought coin and bullion for investors. And he tried to disguise his controlling interest in the companies by employing four people who pretended to run the firms.

Besides World Equity, Boone ran Pacific Exchange Mint and New World Equity Mint, both of Anaheim; Associated Miners Group in Santa Ana; Liberty Mint and Mint Management, both of Tustin, and Ashley Financial Corp. in Costa Mesa.

Boone’s attorney was unavailable for comment Thursday.