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12/09 - EAST ST. LOUIS -- Federal prosecutors are seeking more than $1.9 million from a Trenton man who they say gained the money through a Ponzi scheme that targeted elderly people.

Lavern Huelsmann, 44, was indicted Tuesday on charges of mail fraud and engaging in a financial transaction in excess of $10,000 from property derived from mail fraud.

The indictment accuses Huelsmann of selling fraudulent investments to elderly people. The charges were issued by a federal grand jury in East St. Louis.

Huelsmann, smoking a cigarette Tuesday evening in the den of his new two-story, brick home on Heavenly Drive, said he couldn't comment on the case.

The charges contain a forfeiture allegation, seeking $1.93 million in "funds representing the value of criminally obtained proceeds."

The charges carry a maximum sentence of 30 years in prison and a fine up to $500,000.

According to the indictment, Huelsmann has been operating under the business named Senior Retirement Services and was licensed to sell only approved life insurance and fixed-annuity products.

He allegedly convinced elderly people to invest in a "cash management account" with Senior Retirement Services, but didn't tell them he was the owner of Senior Retirement Services.

Prosecutors say Huelsmann told victims the "cash management account" was invested in government-backed products that provided annual returns of 8 percent to 18 percent, and that clients could withdraw their money at any time without penalty.

Huelsmann deposited the money in accounts he controlled at local banks. He also bought cashier's checks and official checks from financial institutions to make "lulling payments" to victims, according to the indictment. Lulling payments are small amounts paid to reassure victims in investment scams.

The indictment also accuses Huelsmann of using the money to make his own investments, to build and furnish his home at 3220 Heavenly Drive in rural Trenton, to gamble and to buy gold coins, diamond jewelry and heavy equipment. The home and other property also are being sought by the government in the forfeiture count.

Huelsmann has not yet had an initial court appearance or bond setting. Often in federal cases of white-collar crime, a defendant is given a summons to appear in court later for an initial appearance and bond setting.

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