Ex-accountant guilty in $35 million scam

Bob Shemeligian

Friday, March 20, 1998 | 10:11 a.m.

A former Nevada Gaming Control Board accountant has pleaded guilty to conspiracy charges for defrauding investors of $35 million in a complex securities scam.

Jeffrey Jolcover, a certified public accountant who worked for the state from 1977 to 1979, faces a prison term of up to 25 years and fines totaling $550,000 when he is sentenced June 15.

Standing Thursday next to his attorney, Joe Cronin of Reno, Jolcover answered "yes" after U.S. District Judge Howard McKibben asked whether he understood he was waiving his right to trial on each of several charges.

Jolcover pleaded guilty to charges of conspiracy to commit securities, mail and wire fraud, and money laundering in the sales of securities to the public in wireless television systems.

Through the scam, Jolcover defrauded more than 3,200 investors across the nation, according to the criminal charges filed by the U.S. Attorney's office.

Through the use of a nationwide network of telemarketing rooms, Jolcover marketed securities -- interests in wireless television systems in Texas, Nebraska, Alabama and Wisconsin -- to the public, according to charges.

Sources familiar with the investigation explained that telemarketers throughout the nation, working under the direction of Jolcover, utilized infomercials to identify susceptible investors, especially those with Individual Retirement Accounts.

Through a complex securities scheme involving "a maze of interlocking corporate shells," investors were falsely led to believe they could expect a high rate of return, based on projections that Jolcover knew were false, a source said.

Jolcover purchased the wireless television systems, and then created corporate shells to acquire the assets to create the appearance of profitability, an investigator said.

A source said some of the wireless companies are no longer in operation and those that are in operation are not breaking even.

Will the investors -- many of whom are senior citizens who raided their IRA accounts after being targeted by the telemarketers -- ever get their money back?

"Sadly, they probably will receive pennies on the dollar," said an investigator, who explained Jolcover diverted half the revenue from investors to telemarketers throughout the country. "Many of them are transients who operated in boiler rooms. They're in and out in a matter of weeks."

The investigation is ongoing and more charges may be filed, an investigator said.