ANCHORAGE—U.S. Attorney Karen L. Loeffler announced that Donald Lee Smith, 59, of Muldrow, Oklahoma, pled guilty in federal court today, admitting that he fraudulently obtained over $300,000 from victims in Alaska during 2007 and 2008.

Smith pled guilty to one count of wire fraud and one count of money laundering in connection with the scheme. In a factual statement filed with the court, Smith admitted that he obtained $311,000 from the victims by making intentionally false misrepresentations about investment opportunities. Smith admitted that he obtained the funds from his investors and lenders without telling him that he was using a substantial portion of their money to gamble in casinos rather than invest in properties. According to the admissions in court, the victims transferred funds from Anchorage to Oklahoma, which the defendant then withdrew and transferred to other accounts, knowing the money was criminally derived.

Smith was indicted by a federal grand jury in December 2011 and originally charged with 12 counts of mail and wire fraud and one count of money laundering. Smith lived in Alaska when the scheme began but then moved to Oklahoma, according to court documents.

Senior United States District Court Judge H. Russell Holland set sentencing for October 12, with a possibility of extending the date to afford Smith the opportunity to begin making restitution. Smith faces a maximum prison term of 20 years for wire fraud and 10 years for money laundering and a maximum fine of twice the amount stolen or laundered.

This case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation.