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O.C. man arrested in $4.7-million gold mine scheme

Fbi_gold An Orange County man has been arrested and charged with bilking an elderly couple out of nearly $5 million in a phony gold mine scheme, federal prosecutors announced Monday.

John Arthur Walthall, 54, of Laguna Beach was indicted in October on nine counts of wire fraud, money laundering and other charges for allegedly conning a couple in their 80s from Laguna Niguel into investing more than $4.7 million in a partnership to extract gold from old mines in the Imperial Valley, Nevada and Brazil.

He told the couple he had invested more than $3 million of his own money in more than a decade worth of researching the gold extraction process. By investing in Advanced Recycling General Partners, Waltham told the couple they would receive a salary and get to approve expenses.

But prosecutors allege Walthall used the money for personal expenses, including alimony, child support payments, rent and an eHarmony.com account. He also used the money to make a $10,000 payment to a film school for his son and to buy a hyperbaric oxygen chamber worth $60,000.

FBI agents arrested Walthall last week at a friend's home in La Habra, where he was staying.  They found $500,000 in gold coins under his bed and seized three vehicles he allegedly bought with the victims' money: two Ford Excursions and a Ford 450 pickup truck.

If convicted on all charges, Walthall faces a maximum penalty of 150 years in federal prison, a spokesman for the U.S. Attorney's office said.

He is being held without bond until Dec. 7, when he is scheduled to be arraigned.

-- Tony Barboza in Orange County

Photo: Gold seized by federal authorities. Credit: FBI

 
Comments () | Archives (10)

It just goes to say, there are plenty of gullible Americans out there who are willing and able to part with their hard earned money for what, greed? No wonder con artists are cropping up all over the nation and are having a field day. I hope it serves them right and teaches those gullible investors (Madoff victims)a hard lesson, that "if an investment sounds too good to be true, then it must be." Why don't you just give your excess wealth to charity? You can't take it with you when you die anyways.

place your mouseover the gold picture, you know long enough until that yellow box with the name of the picture comes up. it says "Fbi_gold." That makes sense because the FBI will one way or another end up keeping the gold or selling it and keeping the proceeds. Just like Bernard Madoff, 90% of his asset seizure will be sold and kept in the governments pocket. while the remaining 10% will be distributed amongst his bilked investors. when are people going to understand that the fbi, police department, dea, etc. are thieves in the best disguises.

Just goes to say, there are pleanty of gullible Americans who are willing and able to part with their hard earned money! No wonder there are numerous con artists sprouting all over America. The old adage goes to say,"if its too good to be true, then it sounds fishy."

could you please post a foto of John Walthall or email one to me. I know of some scams and am wanting to place the face
with known questionables.
Sincerely, gary

I have a bit of personal info on this one, as he was relying on a technology my father helped develop to extract the gold from the abandoned mine. His business methods and expenditures probably weren't the best, but it wasn't a scam--the technology is sound (I've seen it in action myself), and were the machine built on the proper scale yet, these "scammed" elderly folks would likely be seeing the returns already. Regarding the gold, John was a bit over-cautious, and preferred to invest large amounts of money into gold instead of banks (let's face it, banks aren't doing so hot these days).

I wouldn't post a pic if I had one, as I don't see eccentricity as a crime. Yes, he made some bad judgment calls, but my dad just went from a promising business venture to the street (almost literally), and these elderly folks will probably *never* see a return on their investment now. If John had been a little more up-front with the business updates to his investors, nobody would be complaining in the least, but as it stands, the whole thing's been derailed by impatience and poor communication.

Brilliant.

The technology spoken of DOES IN FACT EXIST. I know this because I have been familiar with it for quite some time now. John Walthall recruited my brother-in-law and myself to adapt and improve it and the drawings are currently in the final stages and almost ready to be fabricated in job-shops. MANY of the details that appear questionable at first are easily and rationally explained.

I am a partner and California liaison for SSE. We have been trying to provide further corroborating details that would clear up the gross misjudgments involved in this investigation. All is definitely NOT what it appears at first blush. We met John about 15 years ago for the first time and he never forgot what we were working on. We were recruited early this year to develop a modified and improved version of the technology and have been doing so. The drawings of the up-scaled model are nearly finished and we next would have been contacting job-shops to fabricate the parts for us. What has taken place here is a travesty of 'justice' and we WANT to clear the air. We have made great effort to get this information to those who have smeared his name, but now it appears it is not so important to them that they also help CLEAR his name. It would be a crime for us to remain silent, so we will continue to attempt to clear his name.

I need to mention I have also personally called the L.A. FBI office twice now and had a luke-warm response to new information I wished to give them. They took VERY brief notes and have not returned calls to interview me. I find this disturbing, to say the least.

I personally have been doing an email and phone campaign to radio and TV and papers to bring this out, but meeting with less than enthusiastic response. Seems it is alright to smear a name and reputation, but no interest when needing to clear one. I, for one, am appalled, too, at the desire of some people to judge and condemn without ALL the facts. Let's just pray that it will not be your name one day that needs cleared.

Steven O.

re: could you please post a foto of John Walthall or email one to me. I know of some scams and am wanting to place the face with known questionables.
Sincerely, gary

Sorry, Gary. I've seen John Walthall, and if you want to see a truly questionable face, simply look in your mirror. Study what you see carefully, and you will learn much more.

I am the owner of the technology in question. It exists. It works. I can't address any of the other counts, but this claim DOESN'T hold water. This technology is based on an earlier model used in Arizona about 25 years ago and contains numerous improvements I have since personally developed.

I first ran an ad for this technology in a mining journal in the 90s (name escapes me at the moment.) Do these points make it "old" technology? Regardless, John was trying to make a positive difference for everyone, from my point of view. (For example, I understand the hyperbaric chamber was a 'disability accomodation for a business partner', namely me, and maybe others.)

John Walthall contacted me a couple of months ago asking me if I could design a high-output fuel system that he could use for the extraction of gold from old mines. I developed the plans for a multi-stage fuel system to insure reliability for that purpose. I spoke with him several times then all the sudden he disappeared on me. Now I know why.
I have more information but do not feel this is the appropriate avenue for it.
Terry

John Walthall contacted me a couple of months ago asking me if I could design a high-output fuel system that he could use for the extraction of gold from old mines. I developed the plans for a multi-stage fuel system to insure reliability for that purpose. I spoke with him several times then all the sudden he disappeared on me. Now I know why.
I have more information but do not feel this is the appropriate avenue for it.
Terry


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