The U.S. Attorney for the Middle District of Florida announced July 10 that James Elliott Davis II pleaded guilty to bank fraud, wire fraud, money laundering and theft of mail.
The 36-year-old Ponte Vedra Beach resident faces up to 30 years in federal prison on the bank fraud count, up to 20 years on the wire fraud count, up to 10 years on the money laundering count and up to five years on the theft of mail count. He also could be ordered to pay restitution to the victims he admitted to defrauding.
Davis also agreed to forfeit between $6.7 million and $8.8 million in traceable proceeds of the crimes he committed.
No sentencing date has been set.
According to court documents, from March 2018 through 2022 Davis ran a purported medical supply company named Medisale Inc. Using false representations, Davis enticed individuals and business entities to invest large sums of money in Medisale.
He falsely represented to victim-investors that Medisale was making significant profits on the sale of COVID-19 personal protective equipment (PPE). He claimed to have contact with CEOs at various hospitals and that Medisale had contracts with hospitals to sell large volumes of N95 face masks and other PPE.
The government said that to convince victim-investors to give him money, Davis showed fraudulent bank statements with large balances, claiming the money was from the sale of PPE.
In reality, Medisale had no such contracts and had no true revenue from the sale of PPE. Instead, Davis kited checks and conducted fraudulent wire transfers between multiple financial institutions in order to artificially inflate the apparent balances on his bank accounts.
Using victim-investor funds, Davis paid off previous debts, paid other investors purported profits from the sale of PPE and paid personal expenses, including using victim-investor money to purchase a membership at a luxury club in Ponte Vedra Beach and spending more than $27,000 on custom clothing.
The case was investigated by the Federal Deposit Insurance Corp. Office of Inspector General, Florida Department of Law Enforcement and the Internal Revenue Service Criminal Investigation.
It is being prosecuted by Assistant U.S. Attorney Kevin Frein. The asset forfeiture is being handled by Assistant U.S. Attorney Jennifer Harrington.
The U.S. Attorney advises that anyone with information about allegations of attempted fraud involving COVID-19 can report them by visiting the Justice Department’s National Center for Disaster Fraud and submitting the NCDF Web Complaint Form at www. justice. gov/disaster-fraud/ncdf-disaster-complaint-form.