“November 30, 2020 – ORANGE, Calif. — Former insurance agent Brian Fredric Sauls, 48, of Santa Ana, was arrested on 13 felony counts of securities violations, theft from an elder, and residential burglary after california department of insurance logoallegedly persuading clients to invest over $1.1 million in unregistered securities in order to receive over $148,000 in undeserved commissions.
From 2016 through 2017, persuaded six clients, including one elderly client, to invest a total of $1,126,333 into Future Income Payments, LLC. (FIP), an unregistered non-exempt security. Sauls received over $148,000 in commissions from these sales.
In April 2018, FIP was shut down and Sauls’ six clients suffered losses totaling $745,419. In March 2019, a Federal Grand Jury indicted FIP and FIP founder Scott Kohn for mail and wire fraud, as FIP was determined to be a “Ponzi” scheme. Kohn is in custody awaiting trial in federal court. Overall losses for individuals who invested in FIP, including Sauls’ clients, were estimated at approximately $310 million.
An investigation conducted by the California Department of Insurance revealed Sauls was not trained, certified or licensed to sell securities. Sauls failed to properly disclose the potential risk of loss to his clients regarding the FIP investments he recommended and he did not give his clients the opportunity to review the disclosure documents he had them sign. The investigation also uncovered that he had initiated investment transactions on his clients’ accounts without their consent or knowledge. Sauls obtained payments from one client by visiting their residence, leading to charges of residential burglary.
“This former agent allegedly violated California law and abused his clients’ trust by steering them to a “Ponzi” scheme that ultimately resulted in a nearly $750,000 loss,” said Insurance Commissioner Ricardo Lara. “These are appalling actions, and my Department will work with the Orange County District Attorney’s Office to obtain justice for his clients.”
In July 2020, Sauls voluntarily surrendered his California Insurance License. The criminal complaint against him includes two enhancements, for alleged fraudulent felony conduct over $100,000, and alleged fraudulent felony conduct over $500,000.
Sauls was arrested on Friday, November 20, 2020, and booked into the Orange County Jail. Bail was set at $100,000. This case is being prosecuted by the Orange County District Attorney’s Office.
Source: CA. Dept. of Insurance”
Sierra Sun Times | November 30, 2020