Former Yellowstone Partners' CEO Pleads Guilty
POCATELLO - David Hansen, 48, of Idaho Falls, pleaded guilty today to wire fraud, U.S. Attorney Bart M. Davis announced. Pursuant to a written plea agreement filed with the court, Hansen pleaded guilty to count 16 of the superseding indictment. The trial set for January 21, 2020 was vacated.
According to court records, Hansen was the Chief Executive Officer and a 90-percent partner in Yellowstone Partners, LLC, an investment management firm headquartered in Idaho Falls. Clients of Yellowstone Partners entrusted their monies to Yellowstone Partners to invest and manage on their behalf. In exchange, Yellowstone Partners earned fees for its services. Yellowstone Partners’ fees were set forth in investment agreements between Yellowstone Partners and its clients.
According to court records, Yellowstone Partners’ clients’ monies were kept in accounts at third party custodians. Yellowstone Partners directed how the monies in client accounts were invested and how they were disbursed. This included submitting email billing requests to a third party custodian to take fees from client accounts and to deposit them into Yellowstone Partners’ own accounts.
According to court records, from 2008 through April of 2016, Hansen knowingly and intentionally devised a scheme to defraud clients of Yellowstone Partners by obtaining money or property by means of false and fraudulent pretenses, representations, and promises. Specifically, the scheme was to fraudulently bill clients for fees to which Yellowstone Partners was not entitled under the terms of the investment agreements or otherwise. Through this overbilling scheme, Hansen fraudulently obtained client funds from a third party custodian and used them to enrich himself and to fund Yellowstone Partners’ operations. For certain identified victims, Hansen personally submitted, or was carbon-copied, on 50 fraudulent overbilling requests to a custodian, which resulted in a loss of $2,675,856. For each of the overbillings, Hansen acted with the intent to deceive or cheat the victims.
Read more: https://www.justice.gov/usao-id/pr/former-yellowstone-partners-ceo-pleads-guilty