LAWFUEL – The Law Newswire – Special agents with the Federal Bureau of Investigation this morning arrested a Burbank man on charges of defrauding a North Carolina man out of more than $8.7 million through a bogus investment scheme.
Thomas Mitchell Johnson, 53, a former member of the boards of directors of the Beverly Hills Chamber of Commerce and the Make-a-Wish Foundation of Greater Los Angeles, was arrested pursuant to an indictment returned Friday by a federal grand jury in Los Angeles. Johnson is expected to make his initial court appearance this afternoon in United States District Court.
According to the 11-count indictment, Johnson represented himself to his victim-investor as a successful businessman with experience negotiating sophisticated transactions that he called “high-yield interest opportunities.” Through his company, Zurich Capital Holdings, Inc., Johnson offered an investment opportunity to the victim-investor, promising to make investments only with the authorization of the victim-investor. In response to these promises, the victim-investor transferred $10 million to an account Johnson controlled.
Despite his promises of secure and profitable investments, Johnson allegedly spent the victim-investor’s money on the extravagant personal expenses of himself and his girlfriend. Johnson allegedly used the victim-investor’s money to, among other things, purchase two houses in Burbank and a Bentley Arnage automobile. The victim-investor ultimately lost more than $8.7 million to Johnson. In 2003, a Los Angeles Superior Court judge ordered Johnson to pay $8.725 million to the victim.
The indictment charges Johnson with six counts of interstate transportation of stolen property and five counts of money laundering. If he is convicted of the 11 counts, Johnson faces a maximum statutory sentence of 110 years in federal prison.
Johnson is currently facing unrelated charges in state court in Utah of selling securities that he did not own through Zurich Capital.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.
The charges in the indictment are the results of an investigation conducted by the Federal Bureau of Investigation.
CONTACT: Assistant United States Attorney Ruth C. Pinkel
Major Frauds Section
(213) 894-6077
Assistant United States Attorney Christine C. Ewell
Chief, Major Frauds Section
(213) 894-4443
Release No. 07-108
