Lavish lifestyle to end in prison for north suburban men

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Updated: March 10, 2012 8:12AM

Former Glencoe resident Charles G. Martin was living the dream. From 2005-07, he spent more than $1 million at a strip club and restaurants, nearly $1 million at elite hotels, and another $1 million renting flight time on private jets. He purchased a fleet of luxury vehicles, including a $375,000 Bentley; donated hundreds of thousands of dollars to celebrity charity events, and hired personal security guards to accompany him in public.

Things will be quite different for the 46-year-old come March 29, when he begins serving a 17-year prison term for running a Ponzi-type scheme that bilked more than 1,000 investors out of more than $17 million, according to the U.S. Attorney’s office.

Martin, who now resides in Malibu, Calif., was sentenced by U.S. District Judge Virginia Kendall to 204 months in federal prison on Wednesday, and his co-conspirator, Lake Forest resident John E. Walsh, 63, was sentenced to 12 1/2 years, according to a release from the U.S. Attorney’s office.

The two men, principals in a foreign currency trading firm that collapsed in 2007, were arrested in January 2009 and pleaded guilty in May 2011 to wire fraud, commodities fraud and tax evasion, the release said. Walsh is to report to prison on March 28.

The judge also ordered restitution of $16.98 million against both defendants, granted a forfeiture judgment against Walsh for $10 million and indicated she will enter a similar order against Martin, the release said. The government has so far recovered in excess of $1 million from selling seized assets and property, as well bank accounts, safety deposit boxes, and third-party recipients of fraudulently-obtained funds.

Like Martin, Walsh used his corporate credit card to charge personal expenses, including more than $140,000 worth of jewelry, $70,000 in country club expenses and $1.425 million to buy a second home in Lake Forest, the release said. Bank records also showed Martin and Walsh spent about $500,000 in 2007 to help finance production of a motion picture, “Order of Redemption,” that listed Martin as a contributing producer.

In January 2009, federal agents searched Martin’s home on Sheridan Road in Glencoe and seized dozens of items, including fine watches and jewelry, antique furniture, oriental rugs, a piano, artwork and high-end electronics, the release said. They also searched Walsh’s residence on Wharton Drive in Lake Forest, seizing cash proceeds from the sale of his former home on Salisbury Lane and a BMW that he transferred to his son.

Martin and Walsh were principals of One World Capital Group, formed in 2005 and based in Winnetka, with an office in New York. In December 2007, the Commodity Futures Trading Commission obtained a court order prohibiting further trading activity and freezing the firm’s remaining assets of $677,932, the release said. At the time, One World had about $17,654,486 in unpaid customer liabilities.

According to the court documents, Martin acted as a principal of One World, though he was prohibited from holding such a position with a National Futures Association member, and Walsh served as president and primary manager. They marketed over-the-counter foreign currency trading services in which they were to serve as the customers’ counterparty.

However, One World’s trading platform actually operated as a front to placate customers whose margin funds were systematically misappropriated, the release said.