Warrant for Kaysville man's arrest for multi-million dollar Ponzi scheme
Friday , June 20, 2014 - 1:42 AM
63-year-old Kaysville resident Dee Allen Randall was charged by the Utah Attorney General’s Office...
KAYSVILLE — A Davis County man is wanted for an alleged Ponzi scheme that officials say bilked Utah residents and others out of their life savings and raked in tens of millions of dollars over the course of several years.
Kaysville resident Dee Allen Randall, 63, was charged by the Utah Attorney General’s Office with 22 counts of second-degree felony securities fraud Wednesday, in addition to one count of the same charge in the third degree. Randall allegedly pulled in more than $72 million from 700-plus investors across the country between 2006 and 2011, all the while misleading them about the use of their funds and their expected returns.
Randall’s initial hearing has been set for July 2 in 3rd District Court in Salt Lake City. He is out of police custody, and a warrant has been issued for his arrest. His bail has been preset at $100,000.
Randall allegedly engaged in investment fraud using several financial organizations which at the time he owned or managed, including the Horizon Financial & Insurance Group, Horizon Auto Funding, Horizon Financial Center and Horizon Mortgage & Investment, among others.
He was effective at misleading investors, according to charging documents, and sometimes used his status as a practicing Mormon as a persuasive tool.
"Most of the investors were sold on the high interest rate offered and because Randall had a good reputation in the insurance industry and was an active LDS member," the documents state. "Some investors stated they felt their investment was safe because Randall told them their investment was backed by real estate or car titles. For some investors, Randall stated or led them to believe that they would be placed on the car titles or deed of trust."
Randall illegally misled individuals about the risks of their investments and told them they were protected, court documents say.
"Many of the investors were told about some of the risks of investing, but Randall explained the risks away," the charges state. "Randall stated to some investors that if anything happened to him, he had a life insurance policy that covered (their losses). Randall also stated that even if he went bankrupt, the assets would be sold and everyone would receive their money back."
His actions constituted an elaborate fraud, according to court documents.
"Specifically, Randall created a Ponzi scheme and misused investor funds," the documents state.
Seven separate parties have sought more than $4 million from Randall in various federal court lawsuits in the past two years, including the South Ogden-based Utah Trapper Trails Council, a local administrative arm of the Boy Scouts of America. The council’s jurisdiction covers the Top of Utah from Layton northward, and also covers southwest Wyoming and a small portion of southeast Idaho. The Council claimed Randall defrauded them out of $281,000, but dropped their lawsuit in June 2012. It wasn’t immediately clear why the case was dropped.
Randall earned his insurance and security licenses in 1988, according to court documents. Those licenses were "terminated" in December 1997, charges state, and Randall has not been licensed in those industries since that time.
That didn't stop Randall from selling a large volume and variety of insurance products, the accusations state.
"In addition to selling insurance products, from about March 2006 through the middle of 2011, Randall offered and sold interests in private placement securities by issuing Horizon Notes on behalf of the Horizon entities," the court documents read. "The investment products offered by the Horizon entities included but are not limited to investments in residential and commercial property development, as well as an automobile loan business for individuals with poor credit. In exchange, investors were given a 'promissory note' and/or other writings outlining the terms and the amount of interest they would receive from their investment."
Randall promised low-risk returns on the notes ranging between 9 and 17 percent annually, court documents say.
The Utah Division of Securities received its first investor complaints in 2009, the agency says, when Randall began to default on his promised returns. By June 2011, when an official investigation into Randall was launched, more than 50 investor complaints had been filed.
Businesses licenses for Randall's various financial enterprises all expired between 2010 and 2012, according to charges. Documents indicate Randall filed for personal bankruptcy in December 2010 and a year later did the same for each of his ventures, but reportedly continued to receive money from investors, many of whom were not qualified to invest.
Randall operated his several businesses throughout Utah, using offices in Kaysville, Woods Cross, Fruit Heights, Logan and Sandy. More than 40 of his former employees were interviewed in the investigation against him.
Biographical information from Randall’s now-defunct personal website reveals some of his business and personal history.
“Dee A. Randall founded Horizon Financial and its group of companies in 1996 and has been the president, treasurer and secretary, and the director of the companies since their founding,” his biographical statement reads. “Mr. Randall has over 30 years of experience in retail sales and manufacturing, including general and personnel management, purchasing, pricing and inventory control. He has been in the insurance industry for twenty years and has been a general agent for fifteen of those years.”
Randall’s profile also touts his religious and family background.
“After serving an LDS mission for two years he met his wife Patricia while attending Brigham Young University. They have been married for 36 years. They have six children, 1 daughter-in-law, 3 son-in-laws, and 12 beautiful grandchildren with another on the way,” the statement reads. “Dee is involved in church and community activities and in his spare time enjoys reading and studying church and American history, watching sports, and spending time with his family.”
Randall’s website also included testimonials that addressed his behavior toward women in the workplace.
“I can tell you that as I have (had) the opportunity to be Dee Randall’s assistant his professionalism has never once come into question,“ wrote one woman who identified herself as Natalie Rodgers. ”The allegations brought against Dee Randall are so far from the truth. As a female employee I have never once been ’propositioned’ or ’harassed’ in any form by Dee Randall. His integrity and general morality would not allow him to stoop to those levels.“
It wasn’t clear from the website what allegations Rodgers was referring to.
More details about Randall’s case and alleged history of fraud will be reported as they become available.
Contact reporter Ben Lockhart at 801-625-4221 or email@example.com. Follow him on Twitter at @SE_Lockhart.STORY:201406190013Warrant for Kaysville man's arrest for multi-million dollar Ponzi scheme /Courts/2014/06/19/Kaysville-man-wanted-for-alleged-major-Ponzi-scheme.html-1