SAN DIEGO – Seven people who claimed they had access to a trust fund created by descendants of Mormon church founder Joseph Smith have been arrested in what federal investigators said was a fraud ring that stretched across several states.
Over a period of more than 10 years, more than 100 victims were bilked out of total of between $20 million and $50 million on a promise that they would receive returns from a $1.6 trillion trust fund allegedly created by Smith overseas, the FBI reported Wednesday. Investigators said there is no evidence such a trust fund exists.
The ring operated out of a liquor store in the Ocean Beach area of San Diego and a local apartment complex where several of the suspects lived.
Investigators said the suspects flew to Utah, Texas, Idaho and other states pitching the deal.
Four suspects were arrested Tuesday in San Diego, two in Utah, and one in Mississippi, FBI agent Adam Lee said. Three other suspects remain at large.
Eight other people were arrested last year and two others agreed to plead guilty before charges were filed against them, Lee said. John Harrell, 70, of Santee, who allegedly led the so-called “Good Samaritan” scam, has been awaiting trial since his arrest in March 2003.
Investigators said the suspects used religion to target wealthy investors, including holding prayer meetings and describing plans to build a religious theme park. Investors with illnesses were promised miracle cures.
Those behind the scam claimed a link to descendants of Smith, the founder of the Church of Jesus Christ of Latter-day Saints, but were in no way connected to the church, Lee said.
The suspects arrested in San Diego were Gregg Stavros, 46; George Eastman, 43, and his wife, Angela, 37; and John Zane, 73.
Kenyon Flake, 44, and Clarence Pack, 63, were arrested in Utah, and Roland Harris, 55, was arrested in Mississippi.
Information from: The San Diego Union-Tribune