BY KIRK DOUGAL

Times Bulletin Editor

kdougal@timesbulletin.com

Two former Van Wert men have been indicted in Michigan on charges of securities fraud, wire fraud, mail fraud, and conspiracy to defraud the U.S. government. Jay V. Merkle, 53, and Eric R. Merkle, along with Charles Coppess of Lansing, Michigan, face 45-count indictments with possible prison sentences of 20 years for each of the fraud charges and another five years on the conspiracy count.

The Merkle brothers allegedly started a company called Platinum Business Industries (PBI) that was said to be involved with oil and gas exploration in Oklahoma. After recruiting Coppess to help find investors, they promised extremely high returns, up to 6% per month, for what would amount to short-term investments. They supposedly drew in victims by saying that the investments were very low risk because they were backed by equipment and other assets of the company.

The indictment charges that the equipment never existed and that none of the funds were used for oil and gas exploration. Instead, the men used most of the money in a variety of "get rich quick" schemes in and out of the country. To keep the first investors unsuspecting, they used some of the money from later victims to make the 6% monthly payments and create the appearance that PBI was delivering on its promises.

The counts allege that the men defrauded investors out of $5 million but the real figure may be as much as ten times more. The victims varied in age and economic status although some were elderly and in nursing homes. At one point, Coppess reportedly helped elderly victims convert their retirement funds and IRAs into cash so they could invest in PBI.

"It's just very embarrassing," said one Van Wert County victim who asked to remain anonymous while the trial is pending. "You work hard your whole life to be smart with your money and save and then it is taken by someone you know. People need to be warned that it can happen in Van Wert, too."

One victim went on to say that the Merkles were still contacting them in the days leading up to the indictments and asking for more money but by then the investors were cooperating with the FBI and U.S. Postal Inspection Service. Those two agencies were in charge of the investigation into PBI.

This is not the first time the Merkles have been in trouble over investment fraud. In January of 2007, they were issued a Cease and Desist order by the Office of Financial and Insurance Services (OFIS) and told to repay all their investors.

At that time their company, Jordan River Resources, Inc., was found to be in violation of Michigan securities law for using deceptive practices to sell unregistered securities in an oil and gas exploration venture. As much as $15 million was taken from unsuspecting investors.

The Merkles were being held while awaiting payments on $1 million bonds while Coppess was free on bond.