Karried
03-25-2009, 06:27 PM
From News 9
OKLAHOMA CITY -- Authorities say three men have been running a Ponzi scheme that has taken in at least $2 million during the last 18 months, but two of those men deny being involved in any illegal activity.
A judge has frozen the assets of the men -- Brian McKye, Joe Don Johnson and James Farnham -- along with those of six Oklahoma City-area businesses:
Global West Funding Ltd. Co., Global West Financial LLC, Sure Lock Financial LLC, Sure Lock Loans LLC, The Wave-Goldmade Ltd. and Heritage Estate Service LLC.
In filings in Oklahoma County District Court, the state Securities Department accused the three men of fraudulently selling investment notes issued by five local businesses. The agency's court petition said McKye, Johnson and Farnham promised returns of 8 percent to 19 percent for their clients on investments secured by risk-free real estate notes.
Irving Faught, the Securities Department administrator, said officials believe more than $2 million might be involved, although no criminal charges have been filed in the case.
"There are several different banks," Faught said. "It looks fairly complicated."
At least 50 investors, mostly local, have been identified, but Faught said that number is likely to increase.
Clell Cunningham, an Oklahoma City attorney representing McKye, said the Securities Department has investigated his client since 2005 but hasn't taken McKye up on an offer to give sworn testimony about the investments.
"We deny the allegations of the petition, and we regret Mr. Faught's claim of a violation of the securities laws," Cunningham said. "This action is very devastating to the companies."
Johnson also denied breaking any laws in the matter.
"There's no Ponzi scheme going on," he said. "That's ridiculous. My assets aren't frozen."
Payday loans, mortgage products and fixed-return investments are offered on the companies' Web sites. Faught said other financing ventures of the businesses supposedly backed the investments he has said were fraudulent.
One of the companies whose assets were frozen by Oklahoma County District Judge Noma Gurich was not accused of issuing fraudulent securities, although it is unclear which one that was.
The Securities Department could make a criminal referral in the case, but Faught said his agency's investigators "haven't even thought about that yet."
OKLAHOMA CITY -- Authorities say three men have been running a Ponzi scheme that has taken in at least $2 million during the last 18 months, but two of those men deny being involved in any illegal activity.
A judge has frozen the assets of the men -- Brian McKye, Joe Don Johnson and James Farnham -- along with those of six Oklahoma City-area businesses:
Global West Funding Ltd. Co., Global West Financial LLC, Sure Lock Financial LLC, Sure Lock Loans LLC, The Wave-Goldmade Ltd. and Heritage Estate Service LLC.
In filings in Oklahoma County District Court, the state Securities Department accused the three men of fraudulently selling investment notes issued by five local businesses. The agency's court petition said McKye, Johnson and Farnham promised returns of 8 percent to 19 percent for their clients on investments secured by risk-free real estate notes.
Irving Faught, the Securities Department administrator, said officials believe more than $2 million might be involved, although no criminal charges have been filed in the case.
"There are several different banks," Faught said. "It looks fairly complicated."
At least 50 investors, mostly local, have been identified, but Faught said that number is likely to increase.
Clell Cunningham, an Oklahoma City attorney representing McKye, said the Securities Department has investigated his client since 2005 but hasn't taken McKye up on an offer to give sworn testimony about the investments.
"We deny the allegations of the petition, and we regret Mr. Faught's claim of a violation of the securities laws," Cunningham said. "This action is very devastating to the companies."
Johnson also denied breaking any laws in the matter.
"There's no Ponzi scheme going on," he said. "That's ridiculous. My assets aren't frozen."
Payday loans, mortgage products and fixed-return investments are offered on the companies' Web sites. Faught said other financing ventures of the businesses supposedly backed the investments he has said were fraudulent.
One of the companies whose assets were frozen by Oklahoma County District Judge Noma Gurich was not accused of issuing fraudulent securities, although it is unclear which one that was.
The Securities Department could make a criminal referral in the case, but Faught said his agency's investigators "haven't even thought about that yet."