In re Raejean S. Bonham dba World Plus
Bankruptcy No. F95-00897
Unofficial Web Site

Strictly speaking, the United States' criminal case against Raejean Bonham has no direct relationship to the bankruptcy case. However, some of the terms of the plea bargain have bearing on the BRA claims and any remaining question of whether or not there was a Ponzi scheme. The plea bargain, which will not be considered by the court until September 23, 1998, is set out here in full.

Joseph S. Beck
Senior Litigation Counsel
U.S. Department of Justice
Criminal Division, Fraud Section
P.O. Box 28188, Central Station
Washington, D.C. 20038
(202) 514-0630
FAX (202) 514-7021

UNITED STATES OF AMERICA,
Plaintiff,	Case No.: A97-0115-CR (HRH)
	Plea Agreement
vs.
Raejean S. Bonham,
Defendant.

I. INTRODUCTION

A. This document contains the complete plea agreement between the plaintiff United States of America and defendant Raejean S. Bonham. No other agreement, understanding, promise or condition exists between these parties.

B. The parties expressly agree and acknowledge that this plea agreement is governed by Fed. R. Crim. P. 11(e)(1)(A) and 11(e)(1)(B). If the court does not accept recommendations or requests of the parties, the defendant may not withdraw her plea of guilty. Fed. R. Crim. P. 11(e)(2).

C. The parties further agree that this matter arises out of facts occurring after November 1, 1987. Therefore, sentencing will be determined by application of the United States Sentencing Guidelines (U.S.S.G.).

II. WHAT THE DEFENDANT AGREES TO DO

The defendant agrees:

A. To enter pleas of guilty to counts 51 and 61 of the Indictment charging the defendant with mail fraud in violation of Title 18, United States Code, Section 1341, and money laundering in violation of Title 18, United States Code, Section 1956(a)(1)(A)(i).

B. To freely and openly acknowledge responsibility for her acts and omissions constituting the factual basis for her plea of guilty.

C. To fully disclose all assets owned by the defendant, or owned by or in the possession of some other person or entity on the defendant's behalf, and to fully cooperate with the bankruptcy trustee in obtaining and locating all assets.

D. To an order of restitution pursuant to 18 U.S.C. §3663(a)(3) in the amount determined by the Court to be the loss incurred by the investors in the scheme.

III. WHAT THE GOVERNMENT AGREES TO DO

The government agrees:

A. Upon the defendant's pleas of guilty and sentencing to counts 51 and 61 of the Indictment as set forth above, the government agrees to dismiss the remaining counts of the Indictment.

B. That if the defendant accepts responsibility for the conduct underlying the Indictment, then she is entitled to seek a two-point reduction in the Sentencing Guideline computation pursuant to U.S.S.G. §3E1.1(a) and the government will not oppose an additional one-point reduction pursuant to U.S.S.G. §3E1.1(b)(2), if the Court determines it is appropriate.

C. That it reserves the right at sentencing to present any evidence and information pursuant to 18 U.S.C. § 3661, to offer argument or rebuttal and to respond to any motions filed by the defendant and to insure the facts and the circumstances surrounding the offenses are fully and accurately presented.

IV. PENALTIES

A. The maximum penalties for violation of 18 U.S.C. § 1341 are as follows: 1) five (5) years imprisonment; 2) a $250,000 fine or not more than the greater of twice the gross gain or twice the gross loss; 3) a mandatory special assessment of $50; and 4) a maximum of three (3) years of supervised release. The maximum penalties for violation of 18 U.S.C. § 1956(a)(1)(A)(i) are as follows: 1) twenty (20) years imprisonment; 2) a fine of not more than $500,000 or twice the value of the property involved in the transaction, whichever is greater; 3) a mandatory special assessment of $50; and 4) a maximum of three (3) years of supervised release.

B. Pursuant to U.S.S.G. § 5E1.2(a) the court shall impose a fine in all cases, except where the defendant establishes that she is unable to pay and is not likely to become able to pay any fine.

C. If probation is authorized under the U.S.S.G. and the defendant violates conditions of probation, the court may revoke the defendant's probation at any time before its termination, and the defendant may be subject to a term of imprisonment. U.S.S.G. § 7B1.1 et seq.

D. Upon violating any condition of supervised release, a further term of imprisonment equal to the period of the supervised release may be imposed, with no credit for the time already spent on supervised release.

E. The court may order that the defendant pay restitution under 18 U.S.C. § 3663 and § 5E1.1 of the U.S.S.G.

F. All payments will be by check or money order, and sent to the National Fine Center as directed by the United States Probation Office.

V. GUIDELINE APPLICATIONS AND SENTENCING ISSUES

A. Mutual Agreements

1. The parties expressly agree that this plea agreement is entered into and is to be controlled by Fed. R. Crim. P. 11(e)(1)(A) and 11(e)(1)(B).

2. If the defendant accepts responsibility for the conduct underlying the Indictment, then the government agrees to recommend that defendant be given a two offense level reduction pursuant to U.S.S.G. § 3E1.1(a). This recommendation is conditioned on defendant's continuing acceptance of responsibility before the court and probation office, including complete and truthful disclosure to the probation office of all information requested. This includes total disclosure by the defendant of all of her assets, including those assets being held for her by a third person or entity. This recommendation also is conditioned on the defendant doing nothing that: (a) obstructs the proceedings of the bankruptcy court; (b) indicates the defendant has not stopped and withdrawn from criminal conduct or associations; or (c) could provide a basis for an adjustment for obstructing or impeding the administration of justice.

3. The parties agree that the amount of loss calculated under U.S.S.G. § 1B1.3 and § 2F1.(b)(1)(P) is more than $10,000,000, but less than $20,000,000.

4. The parties agree that the offenses are grouped under § 3D1.2(d).

5. The parties agree the estimated guidelines computation for this case as follows:

COUNT 51
Base Offense Level: § 2F1.1(a) [Fraud and Deceit]	Level 6
Specific Offense Characteristics
§ 2F1.1(b)(1)(M) Loss [More than $10,000,000]	+15
§ 2F1.1(b)(2) More than minimal planning	+2
Net Offense Level:	23

COUNT 61
Base Offense Level: § 2S1.(a)(1) [Laundering of Monetary Instruments]	Level 23
Net Offense Level:	23
Adjustment for Acceptance of Responsibility § 3E1.1(a) and (b)(2)	-2/3
Net Offense Level	20/21
Criminal History	I
Sentencing Range:	33-46 months

6. The parties agree that the specific offense characteristics and adjustments as set out above are estimates only and not specific agreements; whether these apply can be argued by the parties at sentencing.

7. The court for each count must impose a special assessment of $50. Defendant also agrees to pay this special assessment at or before the imposition of sentence.

8. In the event of an appeal, the government reserves the right to argue the correctness of the sentence imposed even if it differs from any sentence contemplated by either party.

VI. ELEMENTS OF THE OFFENSES

COUNT 51

(Mail Fraud)

The parties agree that in order to establish a violation of 18 U.S.C. § 1341, the government will be required to establish the following essential elements of the offenses:

First: The defendant made up a scheme or plan for obtaining money or property by means of false promises or statements;

Second: The defendant knew that the promises or statements were false;

Third: The defendant acted with intent to defraud;

Fourth: For the purpose of executing the scheme to defraud, the defendant did knowingly cause an item to be delivered by commercial interstate carrier.

COUNT 61

(Money Laundering)

First, The defendant knowingly conducted or attempted to conduct a financial transaction;

Second, The defendant knew the property involved in the financial transaction represented the proceeds of some form of unlawful activity;

Third, The property involved in the financial transaction, in fact, involved the proceeds of specified unlawful activity, that is mail fraud;

Fourth, The defendant engaged in the financial transaction with the intent to promote the carrying on of the specified unlawful activity.

VII. FACTUAL BASIS FOR THE PLEA

1. Beginning in or about 1984 and continuing through December 1995, defendant Raejean S. Bonham resold frequent flyer airline tickets purchased from brokers, who trafficked in frequent flyer award coupons.

2. Beginning in 1989 defendant Raejean S. Bonham solicited money by offering individual investors the opportunity to become part of an "investment program" by purchasing "contracts" in $5,000 increments maturing in six to eight months and bearing a rate of return of 20% to 50% of their principal investment.

3. Defendant Raejean S. Bonham represented to investors that because World Plus was in the frequent flyer ticket business, banks would not lend money to the company thereby creating the need to raise money from individual investors.

4. Defendant Raejean S. Bonham represented to investors that the money invested, combined with that of other investors, would be used to purchase large blocks of frequent flyer miles from multi-national corporations, such as Sony or IBM, when in fact no such purchases could or would occur.

5. Defendant Raejean S. Bonham represented to investors that money they invested in the contracts was "guaranteed", "bonded" and/or "insured" when in fact the monies invested were not guaranteed, bonded or insured.

6. Defendant Raejean S. Bonham represented to potential investors that there were a limited number of participants in the "investment program" and concealed the fact there were several hundred investors.

7. Defendant Raejean S. Bonham created and provided to the investor a one-page contract from either World Plus or Atlantic Pacific containing the terms of the investment including the principal amount, interest and maturity date. A number of contracts stated the principal amount was guaranteed, insured and/or bonded from loss when in fact it was not.

8. Defendant Raejean S. Bonham, when a contract matured, encouraged investors to "roll over" the contract for another term, thereby keeping the cash required to maintain the scheme at a minimum.

9. Defendant Raejean S. Bonham failed to advise and concealed from potential investors that Delta Airlines had obtained a Court Order restraining her from dealing in Delta tickets.

10. Defendant Raejean S. Bonham concealed from potential investors that the State of Alaska regulated the "contracts" she was selling.

11. Defendant Raejean S. Bonham used a portion of the investment proceeds for personal expenses and purchases.

12. Defendant Raejean S. Bonham used a significant portion of the individual investor's investment to repay other investors thereby maintaining her Ponzi scheme.

13. On or about May 9, 1995 defendant Raejean S. Bonham, having devised the above described scheme and artifice to defraud and to obtain money and property by means of false and fraudulent pretenses, representations and promises, for the purpose of executing the scheme and artifice, did knowingly cause to be delivered by Federal Express from Manchester, New Hampshire to Fairbanks, Alaska, a $50,000 check from Sylvia McCormick.

14. On or about November 30, 1995 defendant Raejean S. Bonham gave Robert Koon, one of her investors, a cashier's check for $5,000, made payable to World Plus, Inc. or Robert Koon. The cashier's check was an interest payment on one of Koon's investment contracts. Koon subsequently deposited the check to a bank account. The cashier's check had been given to Bonham as payment for an investment contract by another investor.

VIII. ADEQUACY OF THE AGREEMENT

Pursuant to Local Rule 3.3(C)(7), the agreement contemplates a sentence in accord with the applicable guideline range. The sentence contemplated by the agreement, save for the reduction for acceptance of responsibility, reflects the seriousness of the actual offense behavior.

IX. DEFENDANT'S AGREEMENT AND UNDERSTANDING

I, Raejean S. Bonham, being of sound mind and under no compulsion, threats or promises except as previously stated, do hereby state my understanding of this plea agreement as follows:

A. I wish to enter pleas of guilty to Counts 51 and 61 in the Indictment filed with the U.S. District Court for the District Court for Alaska charging me with mail fraud in violation of Title 18 U.S.C. § 1341 and money laundering in violation of Title 18 U.S.C. § 1956(a)(1)(A)(i).

B. My attorney, Sue Ellen Tatter, has explained to me the charges and the necessary elements.

C. I understand that by pleading guilty, I am admitting that the allegations against me in the Indictment are true.

D. I understand that by pleading guilty I give up the following rights:

The right to object to the composition of the petit jury;

The right to be tried by a jury;

The right to be assisted by an attorney at trial if necessary;

The right to confront and cross-examine the witnesses against me;

The right to utilize the subpoena power of the court to compel the attendance of witnesses on my behalf; and

The right to remain silent.

E. I also understand that if I am convicted after a trial I may appeal the conviction, but that if I enter a plea of guilty to the Indictment, I give up the right to appeal the conviction.

F. I further understand that with a guilty plea, there will not be a trial and that I the Court will ask me under oath to answer questions about these offenses. I understand that I may be prosecuted if I make false statements or give false answers.

G. I understand that I have a right to plead not guilty and that no one can force me to plead guilty. If anyone including my attorney has done or said anything other than what is contained in this agreement, I should inform the Judge when I stand before him to enter my pleas.

H. I understand that no one, including my attorney, can guarantee the outcome of my case or what sentence the judge may impose if I plead guilty.

I. I understand that anything that I discuss with my attorney is privileged and confidential, and cannot be revealed without my permission. Knowing this, I agree that this document will be filed among the papers in my case.

J. This agreement, including my statement, contains everything my attorney has explained to me concerning my case, and the pleas I wish to enter, and contain all of the plea agreements made between my attorney and the attorney for the government. I have read this statement carefully, understand it thoroughly, and wish to enter pleas of guilty to Counts 51 and 61 of the Indictment charging me with mail fraud in violation of 18 U.S.C. § 1341 and money laundering in violation of 18 U.S.C. § 1956(a)(1)(A)(i).

Dated this 30 day of June, 1998

/s/ Raejean S. Bonham
Defendant

/s/ Sue Ellen Tatter
Attorney for the Defendant

Dated this 30th day of June, 1998

/s/Joseph S. Beck
Senior Litigation Counsel

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