Jeff Shoup, who pleaded guilty to conspiracy to commit mail fraud in the failure of two North Myrtle Beach condominium projects that cost investors $5.2 million, will spend less time in prison under an order approved last week by a federal judge.
Judge Terry Wooten reduced Shoup’s sentence by more than two years -- to 63 months in prison from the original sentence of 88 months handed down in 2011. Shoup, 49, is being held in the Beckley, W.Va., Federal Correctional Institution.
Tommy Hix -- Shoup’s partner in T&J Development of North Myrtle Beach, which was supposed to build the Bahama Island and Crystal Palace condo projects -- was released from prison in October. Hix initially was sentenced to 40 months in prison for his role in the fraud but Wooten last year reduced his sentence to 27 months.
Both Shoup and Hix were given reduced sentences because they provided investigators with information that led to the capture of Duwayne Woods, the condo projects’ purported financier who skipped town in 2007 with more than $2 million of investors’ funds. Woods, who was on the run for nearly five years and had been rumored to have fled the country, was captured in 2012 in San Diego. He is serving a 41-month prison sentence at the Taft, Calif., Federal Correctional Institution after pleading guilty last year to one felony charge of mail fraud.
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Hix and Shoup solicited deposits for their unbuilt condo projects during the real estate boom starting in 2004. The developers were supposed to keep the deposits in a trust account but instead put the money in a regular bank account to which both men had access.
When traditional bank financing for the condo projects fell through, Hix and Shoup turned to Woods for help because Woods promised he could fund construction through a foreign bond owned by his Atlewa Trust company. Hix and Shoup transferred the deposits to Woods, who eventually sent some of the money back to the developers but kept $2.2 million for himself. Atlewa Trust turned out to be a shell corporation with no assets and construction of the condo projects was never funded.
Hix and Shoup eventually refunded some of the depositors’ money but spent most of it on personal expenses, salaries, travel and for unrelated projects.
In addition to their prison sentences, Hix and Shoup were ordered to pay back $3 million of depositors’ money. Wooten divided restitution of the $2.2 million Woods kept equally between the three men. So far there has been no financial recovery for those who invested in the condo projects.
Bahama Island was supposed to be a condo and marina project along the western bank of the Intracoastal Waterway while Crystal Palace was supposed to be an oceanfront condo tower.