Man accused in Ponzi scheme pleads not guilty
July 15, 2009 10:40 AM

With a heavy bandage on his left forearm and the start of a beard on his face, financier David Hernandez today made his first appearance in federal court in Chicago since his indictment for allegedly running a $12 million Ponzi scheme.

Hernandez pleaded not guilty before U.S. Magistrate Judge Susan Cox, who postponed the rest of the hearing until Monday so Hernandez's attorney, Jeffrey Steinback, can be present. Hernandez is to remain in custody until then, Cox ordered.

Hernandez, whose alleged scheme helped bankroll the local Internet sports radio station Chicago Sports Webio, fled the Chicago area after being charged last month. The Downers Grove man was taken into custody at a Normal hotel after apparently attempting suicide.

There was no mention of the obvious injury to his arm. Assistant U.S. Atty. Tinos Diamantatos told the judge that the government will seek to keep Hernandez detained because he is a "serious risk of flight."

An assistant federal defender representing Hernandez in Steinback's absence said Hernandez was complaining of a lack of access to phones at the Metropolitan Correctional Center, the federal jail in downtown Chicago where he is being held.

Federal authorities have said Hernandez's alleged scheme victimized 290 individuals over a 2-year period. When the Ponzi scheme collapsed last month, victims lost $3.5 million, prosecutors said.

Hernandez himself had little to say in court beyond entering his plea of not guilty and wishing the judge a good morning.

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Member of the 1 username club.

Terrible article; they forgot to say "by-crackey".

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Power is always in the hands of the masses of men. What oppresses the masses is their own ignorance, their own short-sighted selfishness.
- Henry George

The Crain's article is much better. I love the lawyer he has- Some people should be very worried.
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"Webio founder pleads innocent in Ponzi scheme


July 15, 2009
(AP) — A businessman and web radio promoter charged with swindling 290 victims out of $3.5 million in a Ponzi scheme has pleaded not guilty but says he has retained an attorney who specializes in plea bargaining.

David Hernandez appeared for arraignment Wednesday before U.S. Magistrate Judge Susan Cox. His attorney, John Meyer, said he was merely standing in for Jeffrey Steinback — a prominent plea agreement specialist Hernandez has retained.

The 48-year-old Hernandez is charged with promising victims big returns on investments he never made, instead paying them with money from other investors.

He founded the now-defunct ChicagoSportsWebio.com, an Internet sports talk station that signed Mike North, Chet Coppock and Ray “Boom Boom” Mancini as hosts.

Reports surfaced that checks were bouncing for Webio employees and the Federal Bureau of Investigation had searched Mr. Hernandez’s office in the Loop. Mr. Hernandez is chief executive of NextStep Medical Staffing Inc., among other companies.

The SEC on June 15 filed suit against Mr. Hernandez, his five companies and his wife, charging Mr. Hernandez, a convicted felon, of three counts of violating the securities act and one count of violating the exchange act.

The SEC suit disclosed that Mr. Hernandez was sentenced to 34 months in prison in 1998 after a wire fraud conviction, that he and his wife filed for bankruptcy in 2004, 2005 and 2006, and that he did not as he claimed have a bachelor’s or master’s degree from the University of Wisconsin or a law degree from John Marshall School of Law.

A federal judge temporarily froze Mr. Hernandez’s assets as well as those of his companies on June 15. That same morning, he met with ChicagoSportsWebio.com employees to assure them that the station had a strong future and that he would return in the afternoon, but later that day he was reported missing by his wife, Gina. He was taken into custody a week later.

On June 17, the FBI and U.S. Attorney's Office filed a criminal complaint against Mr. Hernandez and issued a warrant for his arrest."

No it doesn't. It's just holding the place for a guilty plea until terms can be agreed upon.

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O judgment! Thou art fled to brutish beasts,
And men have lost their reason.

He is copping out.....wonder what he has told the Government, if anything?

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There goes one over the fence..Tru Link Fence..Beauty, Privacy Security....Call Tru Link.
Murph's Union 76 Truck Stop....A great Thanksgiving Tradition!!!!

WOO LIFE!!!!

Judge COX !

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fan of Latinspice. fan of DJ Julie. fan of L.E.A.N.

Obviously, Mike North will soon be doing life in prison....

I'm shocked the story didn't say "the popular Mike North." I thought North ass-kissing was mandatory for all media members.

Can't wait to see what kind of "plea deal" the lawyer plans to get. Usually, you have to give show important to get something in a plea deal.

Not enough phone access? Is he missing his chance to be a celebrity mystery guest on MITM?

Unless he had mob or drug cartel backing, his leverage is that he is saving them the time and expense of trial. It's not great but should get him a little something.

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O judgment! Thou art fled to brutish beasts,
And men have lost their reason.

he also has leverage saying where the money went and if there is any left.

He also has North as leverage.

He should have hired HUGE's lawer.

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Without a doubt the gov't will want to know about the money funneled to webio and what happened to it.
The COO, the sales manager and the "partner" in the venture will have to answer a lot of questions about that portion of the money.

that's exactly what I thought of when I read the article. I had to do a double take to make sure I wasn't seeing things.

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Not necessarily, most pleas are done to save the time and expense of going to trial. Mr. Hernandez knows they have him dead to rights, now he is just going to try and cut down on the sentence by agreeing to a plea.

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Whoops, I replied before reading this.


So yeah, what dolphin said.

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