PROVO — Three Utah men who persuaded several Utah and Idaho investors to put their life savings into a bogus lending program were sentenced Monday to jail and prison.
One even lost his company employees' payroll taxes in the scam.
Patrick J. Doyle, 31, Provo, received the stiffest penalty. Fourth District Judge Lynn W. Davis ordered Doyle to prison for up to 15 years on three counts of securities fraud, second-degree felonies; three counts of money laundering, second-degree felonies; and three counts of being an unlicensed broker, third-degree felonies. Doyle pleaded guilty to the charges in September in exchange for prosecutors dropping 30 other counts.
Larry Bosh, 33, Nephi, was sentenced to 12 months in the Utah County Jail with work release privileges. He pleaded guilty in April to two counts of securities fraud and one count of theft, third-degree felonies. Twenty-two counts against Bosh were dismissed.
Steven L. Seely, 47, Pleasant Grove, also pleaded guilty in April to securities fraud, theft and selling an unregistered security, third-degree felonies. Davis sentenced Seely to nine months in jail, also with work release privileges.
Both Seely and Bosh were fined $2,500, placed on 36 months' probation and ordered to pay a percentage of their work-release income to their victims.
"I want to attempt to make these victims whole," Davis said.
The judge said if the two haven't repaid their victims within three years, he would extend their probation until they have. State investigators estimated about two dozen investors, most from Utah County but some from Rexburg and Pocatello, Idaho, lost somewhere between $200,000 and $900,000 from Bosh's and Seely's sales pitches.
"You could be on probation for a significant period of time," the judge said.
According to court documents, the two in 1998 and 1999 solicited for Doyle investments in "offshore" lending programs that they claimed paid returns of between 18 percent and 100 percent. Investors were later told their money had been switched to a day-trading program operated by a California company.
Investors were also told their money was insured and that they could have access to it whenever they wanted. When investors attempted to retrieve their money, however, they were told the program had been shut down because it was part of an investigation involving the Russian mafia.
Prosecutors say some of the money was passed on to a man operating the day-trader program in California and some was spent by Doyle, Bosh and Seely. Investigators say Bosh spent almost $90,000 on expensive "toys," such as snowmobiles, cars and home appliances.
Bosh also invested $300,000 of payroll taxes from his company LNS Enterprises without the permission of his employees, court records show.
The three told Davis they were only the middle tier in a bigger scam. They said they were also victims because they believed their California connections that the investments were "straight aboveboard transactions." All three said they also lost their life savings in the program.
"I only intended to help a lot of people make money," Doyle said. "I was very gullible." Even though the three may have believed the investment plans were legitimate, all attempted to cover up the losses of their investors with lies and false statements, prosecutors said.
"The fact that they intended well does not excuse them for their dishonesty," Utah County Deputy Attorney David Wayment said.
Doyle admitted using other investment schemes to attempt to earn enough money to repay initial investors. State and federal securities officials had warned Doyle several times to discontinue his scams, even requiring him once to sign a statement promising to stop. In court Monday, Wayment called him a "serial con artist." "He's done a tremendous amount of financial harm to this community," Wayment said.
E-mail: jimr@desnews.com