State Can Pursue Dozens Of Charges Against Man Accused Of Fraud, Court Affirms

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State Can Pursue Dozens Of Charges Against Man Accused Of Fraud, Court Affirms

Olivia Covington for www.theindianalawyer.com

More than 30 fraud-related charges will continue against a man accused of running a yearslong investment fraud scheme after the Indiana Court of Appeals determined the state pleaded sufficient facts to prove the man concealed evidence of his actions, thus tolling the statute of limitations.

In Michael Amos v. State of Indiana, 49A02-1610-CR-2429, Michael Amos was charged in June 2016 with 16 counts of securities fraud, 16 counts of offer or sale of an unregistered security and one count of acting as an unregistered broker-dealer, all as Class C felonies. Those charges stemmed from a probable cause affidavit that alleged Amos committed fraud and offered or sold unregistered securities from August 2006 to February 2009, but concealed evidence of his actions. The affidavit also claims he began acting as an unregistered broker-dealer in August 2008.

According to the affidavit, Amos ran two separate schemes involving 13 Indiana investors, as well as a promissory note scheme and a real estate investment contract scheme. The affidavit alleged Amos collected more than $13 million from investors across the county and $6 million from Indiana investors.

Amos began sending updates to his investors in March 2009 with promises to pay their returns, but he would then invariably claim something out of his control would prevent him from doing so. However, more than $2.8 million was spent on personal expenses, while $1.9 million was returned to Indiana investors.

The state first became aware of Amos when a consumer complaint was filed against him in the Office of the Indiana Attorney General in June 2011. More than five years later, he moved to dismiss each of the charges on the grounds that the applicable statute of limitation has expired. Amos also alleged the securities fraud charges were deficiently pled.

In response, the state claimed the structure of the securities and his “updates,” which continued into September 2015, prevented the discovery of Amos’ crimes and that the securities fraud allegations were sufficient to put him on notice of the nature of the charges. The Marion Superior Court agreed and denied Amos’ motion to dismiss, prompting the instant interlocutory appeal.

On appeal, Amos argued the trial court erred by not dismissing the charges on the basis of the five-year statute of limitations. He also argued the charging documents failed to allege he intentionally concealed his actions and that it was clear from the investment documents that he was not a registered agent or broker.

But in a Wednesday decision, Indiana Court of Appeals Judge Elaine Brown wrote the state sufficiently pleaded the circumstances of the concealment exception to the statute of limitations and that the charging information against Amos contained sufficient facts. The appellate court based that decision on Amos’ regular emails to his investors, which were meant to provide reassurance that despite “temporary setbacks,” he would be able to repay their money soon.

“These regular communications, in light of their content, assurances, and requests for patience, may be determined to have been Amos’s attempt to delay or prevent the discovery of his commission of the alleged crimes of securities fraud and offer or sale of an unregistered security and thus constituted positive acts of concealment for purposes of tolling the statute of limitations,” Brown said.

Thus, the denial of Amos’ motion to dismiss was not erroneous.

 

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