Danny Wise charged with 22 additional counts

By Linda Bentley | December 30, 2009
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danny wise$300,000 cash only bond ‘paltry amount’ compared to $82 million unaccounted for
PHOENIX – On Nov. 24, as he was crossing the street from the Lower Buckeye Jail to call his wife to pick him up, former Scottsdale CPA Danny Wise was rearrested and charged with two additional counts each of theft, and fraudulent schemes, all class 2 felonies.

Since that time, an amended superseding indictment has been filed that includes 20 counts of theft and two counts of fraudulent schemes.

Wise, arrested in May, bonded out of jail after his bail was reduced from a $500,000 cash bond to a $360,000 secured bond, as he awaits trial on 15 felony charges for theft and fraudulent schemes totaling over $700,000.

Wise allegedly misrepresented to clients he had sent tax payments to the IRS on their behalf and then had his clients reimburse him for those tax payments, although he never submitted payments to the IRS on their behalf.

When the IRS claimed they received the parties’ returns but no payment, Wise, after being confronted by the victims who were charged with penalties and interest by the IRS, allegedly produced fake copies of checks made out to the IRS. However, the bank on which they were supposedly drawn said no such checks had never been presented for payment.
Two additional victims of this alleged scheme, one of whom has known Wise since the fourth or fifth grade and used Wise as his accountant for the past 25 years, has brought the total of Wise’s alleged theft to over $1 million and resulted in his arrest.
Wise’s CPA license was revoked on Dec. 10, 2008.

On May 20, 2009, Wise was found responsible by the Arizona Corporation Commission for operating a Ponzi-type scheme, was fined $5.7 million and ordered to pay $67.2 million in restitution to his victims.

The probable cause statement dated Nov. 24 notes Wise is currently under investigation by the FBI and other federal agencies, he was forced into an involuntary bankruptcy last year, and all of Wise’s property and assets were seized and placed in receivership for liquidation ordered by the court.

It states, “Wise should be considered a flight risk because he has no ties to the state of Arizona. His CPA license has been revoked, he has no place of employment and he has no place of residence other than a friend’s house. He is responsible for large multimillion dollar fines and restitution and owns no property or assets. The $82 million he has been accused of stealing from over 125 victims of his Ponzi scheme has never been located nor has any evidence of locations of this money been found in records or on computers from prior search warrants.”

The probable cause statement said a $300,000 cash only bond would be requested, calling it a “paltry amount when compared to the $82 million unaccounted for.”
Wise declined to accept a plea agreement and is scheduled to go to trial on Jan. 20, 2010.
However, Attorney Maryann McKessy, the prosecutor assigned to both cases, expects the court to grant her motion to consolidate the two cases, which will presumably bump his trial date further out.
Scottsdale police continued its investigation of Wise after the original 15-count indictment and, as a result, the Maricopa County Attorney’s Office sought the additional charges.
In his probable cause statement, Scottsdale Detective Frank Nagy stated, along with his request for a $300,000 cash bond on the new charges, a “Nebia Hearing” would also be requested.

During a Nebia Hearing, often requested in cases dealing with large amounts of illegally obtained money, the defendant must explain where the monies paid to secure the bond came from and show the money can be traced to a legitimate source.
Bond was set at $160,000 secured on Wise’s new charges. As of this past Monday, Wise was still in jail since his re-arrest on Nov. 24.

Several federal agencies are continuing their investigation of Wise’s purported $82 million Ponzi scheme. However, no charges have yet been filed.

Maricopa County Attorney Andrew Thomas, in announcing the new charges brought against Wise, stated, “As the economy struggles, our office will remain vigilant in prosecuting financial fraud.”