A man who visited Costa Rica on his luxury yacht was a fugitive from U.S. justice for well over 10 years, said the U.S. Attorney’s office in Los Angeles.
The man is James Eberhart, 73, who was sentenced Monday to 120 months in federal prison.
Eberhart ran an Internet scam that brought in $13 million, and he spent the 10 years as a fugitive traveling to the Philippines, Hong Kong, Singapore, Thailand, and most recently to Malaysia, as well as Costa Rica. He spent most of that time living on his 58-foot yacht, the Infinity.
Over 800 victims throughout the United States reportedly invested amounts as high as $100,000 individually.
The U.S. Attorney’s Office said Monday that while in Costa Rica Eberhart tried to have a Tico family adopt him so he would be immune to extradition as a Costa Rican citizen.
He was detained in Malaysia in 2012 and pleaded guilty to fraud in September.
The U.S. Attorney’s office said he operated a fraudulent Newport Beach, California, company called YES Entertainment Network, Inc. According to court documents, he and associates used dozens of boiler room telemarketing firms and a Hollywood celebrity spokesman to raise millions of dollars by telling investors that YES was creating an 18-channel, multimedia, family-oriented Web site.
Investors were told that YES would generate profits through the sale of advertising on the Web site, and that their investment funds would be used to build and market the Web site, said the U.S. Attorney’s Office. Eberhart and associates also told investors that the company planned an
initial public offering of its stock for the fall of 1999, which would potentially make early investments worth millions of dollars.
The government said:
These claims were false. Only 1 percent of investor funds were used to build the YES Web site, which was little more than a façade used to reassure investors. No money was used for advertising, but approximately 45 percent of the funds were used to pay sales commissions to the telemarketers. Most of the rest of the money was wired to bank accounts in Hong Kong and Singapore that Eberhart had formed with the help of an attorney.
In late 1999, while Eberhart was under investigation by the U.S. Securities and Exchange Commission for an earlier investment fraud scheme, and shortly after FBI agents had executed search warrants at the offices of telemarketing companies affiliated with YES, Eberhart and other employees destroyed company documents and fled the country.