(Phoenix, Ariz. – March 28, 2011) Attorney General Tom Horne announced today that Barron Thomas, 55, of Scottsdale; and his mother, Agnes Clark (aka Aggie Clark), 78, of Dallas, Texas; have been indicted by an Arizona State Grand Jury on criminal charges relating to a fraud scheme that is believed to have victimized residents of Arizona and 27 other states. Both defendants self-surrendered before Judge Roland Steinle III this morning, and were arraigned.
Horne said, “It is very important that my office pursues alleged criminal predators such as these. This pair is accused of victimizing people in more than half the United States to the tune of more than $8 million. I am grateful to the hard work done by law enforcement to make sure these people answer for their actions.”
Thomas and Clarke are charged with the crime of Fraudulent Schemes and Artifices, a class 2 felony. Thomas is additionally charged with three counts of Theft Exceeding $25,000.00, all class 2 felonies; three counts of Securities Fraud, all Class 4 Felonies; five counts of Sale of Unregistered Securities, all Class 4 Felonies; and one count Transaction By An Unregistered Dealer or Salesman, a Class 4 Felony.
Between 1992 and 2008, Defendants advertised a series of “short-term” investment or loan programs in a widely-circulated aviation magazine, soliciting individuals to contribute $25,000.00 or more. Defendants informed investors that their monies would be used to purchase, refurbish, and sell airplanes for profit during a set investment term. Investors allege defendants promised them a full return of their principal, plus 12% interest, within 6 to 24 months. Yet, over 60 individuals claim that they have not received their promised payments to date.
Investors claim they were persuaded to contribute large sums into the program based on legitimate-looking promissory notes distributed by defendants, and assurances that Thomas would collateralize the investments by putting first position liens on planes purchased with their funds. It is believed the promissory notes were distributed illegally, and not registered in compliance with state law. Further, defendants are alleged to have made material omissions by failing to reveal the true condition, value or location of the collateral planes to the investors. While investors believed that the collateral planes were of substantial value to secure their investments, subsequent investigation revealed that many of these planes were of little or nominal value, in a state of disrepair, missing critical parts, abandoned, or planes salvaged from fatal crashes.
Defendants are believed to have received more than $8,000,000.00 as a result of the scheme.
This matter is being handled by Assistant Attorney General Yukiko Kuwata. An initial pre-trial conference for both defendants is scheduled for May 11, 2011 at 8:30 a.m. before Commissioner Lisa Vandenberg of the Maricopa County Superior Court. These charges are merely an allegation, and the defendant is presumed innocent until and unless proven guilty.