WILLIAMSPORT – Charges of running a Ponzi scheme filed 17 years ago against a former State College resident who was living in China have been dismissed as no longer being viable.
The U.S. attorney’s office would not provide any further information on the reason for the dismissal motion that U.S. Middle District Judge Christopher C. Conner granted Tuesday.
Dayton Sauerman, who would be 78, was the secretary-treasurer of a defunct nationwide work-at-home business called Club Freedom.
He failed to appear for arraignment in 2005 on 35 counts of mail and wire fraud, money laundering and conspiracy.
A grand jury returned a superseding indictment the following year that added charges of obstruction of justice and making false statements.
He was accused of lying when he told his lawyer he was unable to appear for arraignment because he could not get out of a teaching contract in China and claiming he missed his flight from Beijing due to overbooking.
The government cited customs records it said showed Sauerman had flown from Hong Kong to the United States on Sept. 28, 2005, and flew back to China that Oct. 7.
Records also showed Sauerman on Jan. 12, 2006, flew from London to Los Angeles and on Jan. 29 left for Beijing, it claimed.
The Ponzi scheme Sauerman and others operated was known as Club Freedom whose members were told they would get 150 percent return on their initial membership fee of $200 that later was raised to $300.
The vast majority of the 421 investors who paid a total…
