Austin owner of Bullion Direct accused of stealing millions from customers

Germany Gold Reserves_489215

Various gold bars, are displayed in the German central bank’s headquarters in Frankfurt, Germany, Thursday, Feb. 9, 2017. Germany’s central bank has completed an effort to bring home 300 tons of gold stashed in the United States, part of a plan to repatriate gold bars kept abroad during the Cold War. (AP Photo/Michael Probst)

AUSTIN (KXAN) — An Austin man who ran Bullion Direct, Inc. (BDI) is accused of taking money from customers who thought they were getting precious metals in return but never did to the tune of $16 million.

According to the U.S. Department of Justice, Charles McAllister, 47, was indicted on federal wire fraud and money laundering charges in connection with a scheme to defraud customers. Investigators determined from 2009 to 2015, the money sent to Bullion Direct was not used to purchase precious metals on their behalf but rather McAllister allegedly spent the money on company expenses, on other investment activities and for his own personal use and benefit.

Federal authorities say McAllister, who has pleaded not guilty, made around $16 million from the proceeds of his alleged scheme. If convicted, he faces up to 20 years in federal prison for each wire fraud count and up to 10 years for money laundering charge.

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