FBI found gold, cash on fake billionaire fugitive Justin Costello

Prosecutors on Tuesday asked a California federal judge to jail without bail a recent fugitive accused of a brazen $35 million fraud that involved him falsely telling investors he was a billionaire, a Harvard MBA, and a special forces veteran who was wounded twice in Iraq.

An FBI SWAT team caught the fugitive, Justin Costello, in a remote area near San Diego on Oct. 4. He was carrying a backpack loaded with six one-ounce gold bars worth $12,000, U.S. currency worth $60,000, another $10,000 in Mexican pesos and banking cards and checkbooks, prosecutors said in a court filing.

Costello, 42, also had a receipt for a pre-paid phone number in the backpack, along with a driver’s license with his photograph and the fake name “Christian Bolter,” the filing revealed.

The U.S. Attorney’s Office for the Southern District of California cited the backpack’s contents and other factors in the filing as it urged a judge to remand Costello to jail pending trial. Prosecutors argued he is “a serious flight risk and a danger to the community.”

They noted that Costello failed to surrender to the FBI’s San Diego office as he had agreed through his lawyer on Sept. 29. He was set to face what he had been informed was a new indictment in federal court in Washington state on a slew of charges related to schemes involving penny stocks, shell companies, and cannabis businesses.

Instead, he “became a fugitive,” prosecutors wrote.

“The FBI tried to track Costello by his known cell phone numbers but were unsuccessful,” prosecutors wrote. “It is believed Costello took countersurveillance measures to prevent being tracked on devices registered to those numbers.”

The FBI eventually “was able to track Costello through location information received from the theft recovery service for the Alfa Romeo vehicle he was driving,” the filing revealed.

The FBI SWAT tracked that car to a remote area of El Cajon, California, where they saw him walking around with his backpack, the filing said.

When agents arrested him, Costello “stated he was surprised agents had found him because he turned his phone off.”

Costello also told the agents he had not surrendered as agreed “because he recently had a stroke and needed to recover.”

“Costello said that he could have outrun the SWAT agents but for the stroke,” the filing said. “Costello admitted that he was the person charged in the Indictment and encouraged agents to ‘Google’ him to read about the case.”

“Costello was likely referring to the very significant media coverage of both his criminal charges and
subsequent flight from prosecution,” prosecutors wrote in a footnote, which links to CNBC’s article about him published last week.

Prosecutors said the FBI soon after learned that the gold in the backpack was part of a larger quantity of gold, worth $94,000, that Costello purchased in April “using money he had…