Winans Family Member Charged in $8 Million Ponzi Scheme

Michael Winans Jr.
DETROIT (September 13, 2012) - A member of the famed Winans gospel singing family has been charged in federal court with operating an $8-million Ponzi scheme that promised investors huge returns for investing in phony Saudi Arabian crude oil bonds.

Michael Winans Jr. was charged Tuesday in U.S. District Court in Detroit with wire fraud, which carries a maximum penalty of 20 years in prison. He is accused of defrauding more than 1,000 investors of $1,000-$7,000 each between October 2007 and September 2008. Winans' lawyer, William Hatchett of Pontiac, said Winans plans to plead guilty within the next 10 days and that he intends to repay investors.

"He wants to bring this to a speedy and just conclusion," Hatchett said, adding that Winans wants to make sure everyone knows that other family members weren't involved in the scheme.

The Michigan Office of Financial and Insurance Regulation issued a cease and desist order against Winans in 2010, saying he used his connections in Detroit churches to lure investors into the scheme.

Money from later investors was used to pay returns to earlier investors, the characteristic of a classic Ponzi scheme, the government said, and Winans put some of the money to his own use.

The Associated Press said Winans is a third-generation member of one of gospel music's most famous families. He is the grandson of Delores (Mom) Winans and David (Pop) Winans Sr., and son of Michael Winans Sr., who was a member of the Winans, a quartet of brothers. Michael Winans Jr. is the nephew of Marvin Winans, the pastor of Perfecting Church in Detroit who gave the eulogy at Whitney Houston's funeral.

Source: Detroit Free Press
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