INDIANAPOLIS, Ind.— The founder of an Indianapolis charitable foundation was sentenced Monday following his guilty plea in connection with a $1.7 million fraud scheme.
Michael Russell, 54, was sentenced to four years and nine months in federal prison after pleading guilty to wire fraud and money laundering charges.
Russell, along with former Indianapolis City-County Councilor Paul Bateman, was charged in late 2011, after authorities said they urged the victim to invest in the company. Bateman allegedly accepted five checks totally $702,000, between February and April of 2007. Officials said all of the checks were deposited into Bateman’s personal bank account.
Authorities said Russell also admitted that in 2007, he and Bateman again solicited money from the victim, successfully urging him to invest $1 million in a corporate bond for the Russell Foundation, an organization created to provide community leadership and poverty relief. Russell later admitted that this money was spent on personal expenses over the course of just 33 days.
The men are accused of using the money for entertainment, clothing, jewelry, travel and vehicles.
In addition to serving prison time, Russell was ordered to pay $1.7 million in restitution to the victim of the scheme.
Bateman, who also pleaded guilty, is scheduled to be sentenced on Monday, May 20.