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Hall company investigated for fraud

Investors, buyers may have lost millions to business

POSTED: October 21, 2008 5:00 a.m.
A Gainesville business is the focus of a wide-reaching criminal investigation that could involve dozens of victims and losses in the millions.

Hall County Sheriff’s Col. Jeff Strickland confirmed Friday that officials are conducting a financial crimes investigation into North Georgia Equipment Sales, an Aviation Boulevard business that deals in heavy equipment.

Strickland said the company may have victimized investors.

"There does appear to be a number of investors involved, both locally and from other states," Strickland said. "Indications are it’s a substantial amount of money."

Strickland said investigators "do have a person of interest in the investigation, but we are not releasing a name at this time."

No arrests have been made.

According to the Georgia Secretary of State’s Office, Wendell Spell is listed as the registered agent of North Georgia Equipment Sales Inc.

Mark Caton, a purchasing manager for a heavy equipment company in Richmond, Ky., said Friday that his business wired Spell money for equipment it never received.

"He got us for a seven-figure amount," Caton said. "There’s quite a number of people in our shoes — as many as 60."

Caton said it appeared victims were in two categories: those who paid for equipment that never arrived, and those who invested in the company. He said no one has been able to contact Spell since Tuesday.

"We all came to the same reality on that day," he said.

An Internet discussion page was buzzing about the business on Friday.

"The owner of North Georgia Equipment Sales has stolen millions of dollars from investors," one anonymous poster from Duluth identified as "Victim of Fraud" wrote. "As of Tuesday morning, he is no where to be found. The police are involved, and this will be a criminal case of fraud."

A Hall County Sheriff’s investigator also posted a comment on the Web site, looking for potential victims.

"If you have invested money with Wendell Spell, please contact me," Investigator Scott Lilly wrote.

According to public records, Spell, 50, has two felony convictions in Virginia for obtaining money by false pretenses. Both crimes occurred in 1996.

Caton said Spell was trusted and well-known in the heavy equipment industry.

"We’ve done business with him in the past with no problem," Caton said.

Caton said trust is a big factor in the deals made in his industry.

"It’s amazing how easy it would be, when you’ve got people wiring you millions of dollars from all over, to just pull the plug and disappear," he said.

Sheriff’s officials first became involved in the case on Tuesday and asked for help from the Georgia Bureau of Investigation as the scope of the case became apparent, Strickland said. Authorities are not ruling out federal involvement.

Caton, the victim, said it’s possible some investors still could be unaware that the company is under investigation.

"There may be some people out there who don’t even know they’ve been hoodwinked yet," he said.



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