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“New Century Science and Industry Matrix,” just a con used used by Wesley Rhodes Jr. in $22 million Ponzi scheme with his companies Professional Practice Planning Services Inc., Resource Transactions Inc. and The Rhodes Company.

02/17/09 - Portland Oregon - A 57-year-old West Linn man will spend 10 years in prison after pleading guilty to charges fraud and money laundering charges that involved dozens of investors and an estimated $22 million.

U.S. District Judge Ancer L. Haggerty sentenced Charles Wesley Rhodes Jr. Tuesday in federal court. Rhodes pled guilty to one count of mail fraud and one count of money laundering.

Rhodes operated several investment companies, including Professional Practice Planning Services Inc., Resource Transactions Inc. and The Rhodes Company in Lake Oswego. Through those firms, federal prosecutors said Rhodes lied and misled investors into thinking that their money was being invested in mutual funds, stocks and bonds.

Using his own proprietary investment program known as the “New Century Science and Industry Matrix,” Rhodes convinced investors that their money was safe, when in fact he diverted millions of dollars for personal use.

Between 1998 and September 2006, Rhodes spent more than $3.2 million in investors’ money on luxury and exotic cars, more than $2 million on loan and credit card payments, and more than $418,000 on mortgage payments on a $1.1 million house in West Linn he owned until his fraud was discovered.

In total, he and his businesses spent more than $18 million in that 8¾-year period – excluding the $1.6 million he spent on his company’s payroll.

To cover up the diversion and misappropriation of millions of dollars, Rhodes allegedly prepared and distributed to investors, false account statements and false IRS-Forms 1099 that purported to report the amount of taxable interest and dividend income they had earned in the managed accounts.

Rhodes reports to federal prison June 1. During the next few months, federal officials expect to determine how much restitution Rhodes must pay.