Joshua Allen asked that the federal case against him for securities fraud be thrown out. Fred Biery, the United States District Judge in his Ferrum Capital LLC trial scheduled to begin August 10, denied the request.
Allen claimed the indictment against him “fails to meet” constitutional and procedural standards – making it impossible to get a fair trial.
Prosecutors countered with previous rulings from the Fifth Circuit Court of Appeals showing how the indictment does meet Sixth Amendment standards.
Recap of case, charges
Allen and his fellow Lubbock businessman Michael Cox are accused of using Ferrum Capital to defraud hundreds of investors out of more than $67 million. According to criminal case records and multiple lawsuits, many of the victims came from either the Lubbock or the San Antonio areas.
Ferrum Capital’s business affiliate in San Antonio, Brooklynn Chandler Willy, pleaded guilty this year and will be sentenced after Allen and Cox go on trial – starting August 10 and lasting an estimated three weeks.
Allen and Cox have been – since July 2025 – charged with securities fraud along with:
- Conspiracy to commit wire fraud,
- Conspiracy to commit money laundering, and
- Conspiracy to launder monetary instruments.
“If convicted on all charges, they face up to 70 years in prison,” a previous statement from federal prosecutors said.
Allen’s attempt to toss the case
Allen filed a motion July 20 to dismiss the indictment.
His motion by attorney Anthony Box said, “… The indictment does not identify a single specific instance of criminal conduct. An indictment must give proper notice to the accused …” Box wrote.
He quoted the Sixth Amendment to the U.S. Constitution, which said in part, “In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury … and to be informed of the nature and cause of the accusation …”
Box demanded that the indictment have “a statement of the facts and circumstances as will inform … [Allen] of the specific offense.”
“The Indictment does not identify a single wire transmission. It does not allege the date of any wire, the sender or recipient of any wire, the financial institutions involved in any wire, or the amount of any wire. It does not allege that Allen personally caused any wire to be transmitted,” Box wrote.
“This silence is fatal,” he claimed.
Without more information, it’s impossible to determine which transactions were fraud and, “Allen is left to speculate,” Box wrote.
“This vague pleading renders it impossible for Allen to prepare a meaningful defense,” Box wrote.
Prosecutors – and the judge – disagreed.
Joseph Blackwell, Assistant United States Attorney, argued Allen’s request was based on a mistaken premise.
“Allen is wrong. No specific wire need be alleged or referenced because there is no overt act requirement,” Blackwell wrote.
“The Fifth Circuit has spoken clearly,” Blackwell added and cited a specific court case.
Box, on Allen’s behalf, also claimed the use of four companies – Ferrum Capital, Ferrum II, Ferrum III and Ferrum IV – requires the government to prove each one as a separate conspiracy.
That means much of the case must be dropped because of the statute of limitations, Box argued.
“Because the alleged Ferrum II, Ferrum III, and first-round Ferrum IV schemes were completed well outside the five-year statute of limitations, prosecution based on those alleged conspiracies must be dismissed,” Box argued.
Blackwell wrote back in his reply, “No statute of limitations issue exists in this case. Because there is a single continuous conspiracy, there is no violation of the statute of limitations.”
“Cox and Allen used several Ferrum entities. This is akin to a workman using several different tools to build a house,” Blackwell wrote.
One conspiracy went on over the course of time, he said, so the statute of limitations is nowhere close to expiring.
“The Indictment clearly has charged and set forth a single wire fraud conspiracy,” Blackwell wrote.
“The object of the conspiracy is clearly defined in the Indictment and was ‘to enrich the conspirators by inducing individuals to invest money into the Ferrum Entities by providing false and misleading information and omitting material facts regarding their investments.’”
Allen and Cox provided false information or withheld important information, Blackwell claimed. Victims were misled and the two Lubbock men “wholly controlled” the investor funds.
A previous statement from federal officials said victims sometimes lost their life savings or retirement savings.
“They used multiple Ferrum entities — often in concert and interchangeably. But their core goal to lie to people to get their money was the same. Unfortunately, they were wildly successful. Allen’s motion to dismiss should be denied,” Blackwell wrote.
There are efforts in civil lawsuits and bankruptcy proceedings to recover some of the money.
