SAN ANTONIO — Two Lubbock men, Joshua Allen and Michael Cox, made their initial appearances in federal court on Thursday following a July 2 indictment charging them with their alleged roles in a multi-million-dollar Ponzi fraud scheme involving hundreds of victims.

The indictment accuses Allen and Cox of jointly owning and operating four investment companies—Ferrum Capital LLC, Ferrum II LLC, Ferrum III LLC, and Ferrum IV LLC. Alongside co-defendant Brooklynn Chandler Willy of San Antonio, they allegedly solicited investors under false pretenses, promising secure returns while concealing high commissions and misrepresenting the nature of the investments.

Willy, who owns Chandler Capital Holdings and Queen B Advisory LLC doing business as Texas Financial Advisory (TFA), was previously arrested in December on separate fraud and obstruction charges. TFA purported to provide asset management and financial planning services.

According to federal prosecutors, the trio used investor funds to pay earlier investors, thereby sustaining the appearance of a legitimate operation and attracting new victims. Prosecutors allege much of the money was also used for the personal benefit of the defendants and their associates.

Allen, Cox, and Willy are charged with conspiracy to commit wire fraud, conspiracy to commit money laundering, conspiracy to launder monetary instruments, and securities fraud. If convicted, each faces up to 70 years in prison.

The FBI and IRS-Criminal Investigation are handling the case. Assistant U.S. Attorneys Joe Blackwell and Kelly Stephenson are prosecuting.

Allen and Cox appeared before U.S. Magistrate Judge Henry Bemporad on Thursday. Sentencing, if applicable, will be determined by a federal district court judge.