A Warren man was indicted Monday on one count of mail fraud after he allegedly defrauded nearly 200 investors of $7 million over 14 years, according to the U.S. Attorney.
David J. Harriett, 60, is the owner and president of DJ Harriett, Inc., and allegedly told more than 200 investors that he and his company were approved project managers for the construction of McDonald's and Pioneer Chicken franchise restaurants in Ohio, Indiana, New York, Pennsylvania and Florida, said a release from the U.S. Attorney's office.
He allegedly solicited investors, and in exchange for their investments, provided them with promissory notes that guaranteed the return of their investments plus significant returns, said the release.
The money, however, was being used to make Ponzi payments to other investors, operate his business and for his own purposes and personal use, said the U.S. Attorney's Office.
Harriet also reportedly sent several letters through the mail to investors falsely representing success and growth of the company and of franchise construction contracts.
The activity occurred from August 1996 to January 2010. The charge was filed Monday in Cleveland Federal Court.
Harriett's listed address is on Springbrook Drive in Howland Township, but neighbors said he moved several months ago. His business, DJ Harriett, is located at 6600 Seville Drive in Canfield. As of Monday, the phone there was shut off and a sign at the door said the business was closed until further notice.
His company in February was rated an "F" with the Better Business Bureau, in part due to the number of complaints that had been filed with BBB by consumers.
Harriett and DJ Harriett, Inc., are also named in at least two dozen civil complaints made by both individuals and creditors in both Mahoning and Trumbull county courts.
"Fraud in the market place is a significant problem that negatively affects consumer confidence and, ultimately, economic recovery," said Steven M. Dettelbach, U.S. attorney for the Northern District of Ohio. "For these reasons, we will continue vigorously to prosecute Ponzi schemes.
The case was investigated by the FBI's Youngstown office.
