News


Former Sarasota Insurance and Securities Agent arrested for Organized Scheme to Defraud; Selling Unregistered Securities

3/5/2009
 
The Florida Department of Law Enforcement (FDLE) and the Office of Financial Regulation (OFR) Bureau of Financial Investigations announce the arrest of Scott Leon Johnson, 56, of Sarasota, on charges related to defrauding three elderly clients out of investment funds totaling $182,790. Johnson was formerly licensed with the State of Florida to sell both investment securities and insurance products through two businesses, Automated Trading Systems and Augusta Financial Corporation.

Johnson was arrested yesterday at his residence by the Sarasota County Sheriff’s Office and charged with organized scheme to defraud in an amount in excess of $50,000, a first-degree felony, and selling unregistered securities, a third-degree felony.

Investigators began their investigation after receiving a complaint in April 2008. The investigation revealed that Johnson committed the fraud through two methods. Johnson offered to act as an investment advisor to the first victim who was also his neighbor. After gaining her trust, rather than having his neighbor make her investment checks payable to a registered insurance or insurance company, Johnson instructed the victim to make her investment checks totaling $51,500 payable directly to him. Johnson allegedly used these funds for his own purposes.

The investigation also revealed that when Johnson took possession of victims’ funds he would structure or break down their investments into several smaller amounts which were transferred repeatedly between numerous trading accounts resulting in a portion of transferred funds being deposited back into his personal checking account. Johnson then used victim funds to pay personal expenses such as his mortgage, car loan and cash payments.

FDLE and the OFR warn citizens to use caution when making financial investments, to ask for receipts or confirmation of transactions, and to be sure checks are made out to reputable financial organizations.

Johnson was booked into the Sarasota County Jail.


For Further Information Contact:
Heather Smith, Kristen Perezluha or Mike Morrison
FDLE Office of Public Information
(850) 410-7001