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Federal jury finds MN Man guilty of defrauding investors of $1.5 million in wind energy project

This news story was published on April 6, 2014.
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MINNEAPOLIS – On April 1 in federal court, a jury found a 52-year-old North Oaks man guilty of defrauding investors to persuade them to invest in a purported wind energy project. Instead of building the wind energy project, the defendant used the investors’ $1.5 million to pay for his personal expenses and his other wind energy projects. On April 1, 2014, following a six-day trial, the jury convicted Gregory Joseph Jaunich on five counts of mail fraud. Jaunich was indicted on July 16, 2013.

According to the evidence presented at trial, from October 2006 through January 2007, Jaunich solicited funds from individual investors and investor groups for the purchase of membership units in Averill Wind, a company Jaunich created to develop and operate a wind energy project in Clay County, Minnesota. To induce these investments, Jaunich made false material representations concerning the project’s status, including telling them that the project was closer to completion than what was actually the case. In addition, Jaunich failed to disclose that at the time he was soliciting investments in Averill Wind, he was under criminal investigation by federal law enforcement for fraudulently overbilling Xcel Energy for wind energy production.

From October 2006 through January 2007, Jaunich received more than $1.5 million from investors. Jaunich told investors that the funds would be used to develop, operate, and maintain the Averill project. Instead, Jaunich diverted almost all the funds to his own personal use to pay personal expenses and debts and to pay expenses and debts relating to other wind energy projects. To keep the scheme from being discovered, in April 2007 and June 2008, Jaunich mailed letters to the investors containing false information about the status of the Averill Project and the use of the investors’ money via the United States Postal Service.

For his crimes, Jaunich faces a potential maximum penalty of 20 years in prison on each count. U.S. District Judge John R. Tunheim will determine his sentence at a future hearing, yet to be scheduled. This case is the result of an investigation by the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorneys Kimberly A. Svendsen and John Kokkinen.

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11 Responses to Federal jury finds MN Man guilty of defrauding investors of $1.5 million in wind energy project

  1. Messy Blumpkin Reply Report comment

    April 8, 2014 at 4:34 pm

    Lock the little turd up and throw away the key.

  2. Messy Blumpkin Reply Report comment

    April 6, 2014 at 11:35 am

    Wind and solar energy are not sustainable, coal is the way of the future. What if the sun doesn’t shine and what if the wind doesn’t blow. Coal is great and we should be utilizing more fossil fuels. Nuclear power is another great option.

    • LVS Reply Report comment

      April 6, 2014 at 2:58 pm

      @mesy-I have heard and read that they have improved solar tremendously in the last few years. I know they use it a lot in the south and out west. Wind on the other hand I consider a scam. The cost of it is prohibitive and that is why it must be heavily subsidized or it fails. I agree that with new technology they have made coal clean burning and I think you will see it come back if we get rid of the Obama’s.

  3. Mediator Reply Report comment

    April 6, 2014 at 8:46 am

    Recently, Alliant announced that they wouldn’t be raising prices.

    When was the last time we had a peak alert? Wind energy is helping us by keeping our energy costs from rising as they have in other places.

    Iowa currently generates 27% of our electrical needs from wind. Without it, we’d have had to build 1/4 more power plants and burn more fossil fuels.

    To say we are getting nothing is wholly inaccurate.

    • Philosophus Reply Report comment

      April 6, 2014 at 9:18 am

      Well I’ll tell you right now Doug. The only way you’ll win my endorsement is if you publicly commit to County Wind and Solar Projects which service the people of North Iowa through private cooperatives or special energy company contracts and binding agreements. This is PRECISELY the role of what good Supervisors should be doing. You’ll probably lose votes but will win on principle and be on the right side of history.

    • LVS Reply Report comment

      April 6, 2014 at 10:34 am

      @Mediator-Alliant can make all the claims they want but I will tell you my Alliant bill has gone UP $120.00 p/month in the last six months and will stay that way for at least another six months. That is $1,440 for the year. My house is well insulated with new windows and doors so you tell me they have not raised rates and I will show you my bill> And, we are on the budget plan as well.

      • Mediator Reply Report comment

        April 6, 2014 at 12:18 pm

        Thanks for your comment, LVS. I should have clarified that I was speaking of their electric rate, not their NG rate. I don’t know about that since I’m on LP backup for Geo-Thermal.

        GeoThermal has cut my bill by a huge amount, hundreds per month. But it’s not for everyone.

        • LVS Reply Report comment

          April 6, 2014 at 2:54 pm

          @Mediator-I have thought about Geo Thermal, but at our age I would never get a payback on it. If I was building a new home I would have Geo Thermal and Solar. Solar has come a long way in the last few years and I know they use it down south a lot. I think keeping the snow off up here could be a problem or it but they may have that figured out too.

  4. LVS Reply Report comment

    April 6, 2014 at 7:43 am

    This whole wind thing is fraud as far as I am concerned. It was supposed to be less expensive and save us all money on our utilities. Instead, the only ones making money is the farmers who are getting paid for the lease (and they don’t need it) and they also get paid by the government for taking that land out of production and the power company’s. We subsidize wind with our taxes and the rich get richer and we save nothing. What a bunch of fools.

    • Philosophus Reply Report comment

      April 6, 2014 at 8:21 am

      The way it’s being handled, I agree with you. Farmers get paid good amounts of money for large turbines to sit on their land, and the energy is exported far away from our local community getting use out of it, at a transmission line loss. It’s ridiculous and the politicians need to get off their ass and draft new rules about localized benefit of the power created. Wind turbines in our area need to POWER OUR AREA. Shipping it far away defeats the purpose of sustainability.

    • Philosophus Reply Report comment

      April 6, 2014 at 8:24 am

      There is really only one clear choice to combat these powers that be, who are constantly ripping people off: That choice is to follow the Earthship model for home design, and put in place on-site renewable energy systems, solar, wind, geothermal to get off the grid completely. It’s fine to enter into private wind or solar development projects with your neighbors. Large turbines should service the homes in the immediate area. It’s a REVOLUTION against the endemic theft and hegemony.