SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 17398 / March 6, 2002
Accounting and Auditing Release No. 1515 / March 6, 2002
United States v. Jon Jeffrey King, et al, Criminal No. SA-00-CR-154-OG
(W.D. Texas)
SECURITIES AND EXCHANGE COMMISSION v. AMERICAN TELEPHONE + DATA, INC.,
WILLIAM POSNETT LYNAS, III, JANEEN HAUXHURST-LYNAS, AND DANIEL W.
KRATOCHVIL, Civil Action No. (C.D. Cal.).
The Commission announced that on February 7, 2002, a judgment of
criminal conviction was entered against Jon Jeffrey King of San
Antonio, Texas in the United States District Court for the Western
District of Texas. U.S District Judge Orlando Garcia sentenced King to
ten years imprisonment, ordered him to pay a $10 million fine and to
forfeit all proceeds from a scheme to defraud investors in several
domestic business ventures including American Telephone + Data, Inc.
and Cash Can, Inc. The Court also sentenced King's wife, Patricia L.
King, to three years probation for her role in the scheme that
defrauded over $10 million from investors. The convictions result from
an extensive investigation conducted with the participation of the
Commission, the Federal Bureau of Investigation, and the Internal
Revenue Service - Criminal Investigation.
On June 25, 2001 Jon King pleaded guilty to one count of conspiracy to
commit securities, wire and mail fraud and one count of conspiracy to
launder money. That same day Patricia King pleaded guilty to three
misdemeanor counts of providing false information on her 1993, 1994,
and 1995 income tax returns.
Other defendants charged in the criminal case include Jon King's son,
Michael J King, of Austin, Texas, Patricia King's sister, Elizabeth
Ward Moore, of San Antonio, Texas; Roger Patterson Lund of Salt Lake
City, Utah; and Herbert Dale Carver of New Orleans, Louisiana. On
December 3, 2001 Moore pleaded guilty to one count of conspiracy to
commit securities, wire and mail fraud. As a result, she faces up to
five years in federal prison and a maximum $250,000 fine. On December
12, 2001, Michael King pleaded guilty to conspiracy to commit money
laundering. As a result, he faces up to seven years in prison. Lund
and Carver each face charges of conspiracy to commit securities, wire
and mail fraud and conspiracy to launder money. No trial date has been
scheduled.
In a related civil enforcement matter, the Commission announced that
the United States District Court for the Central District of
SNIPPETS:
Accounting and Auditing Release No. 1515 / March 6,
SECURITIES AND EXCHANGE COMMISSION v. AMERICAN TELEPHONE + DATA, INC.,
The Commission announced that on February 7, 2002, a judgment of criminal conviction was
U.S District Judge Orlando Garcia sentenced King to ten years imprisonment, ordered him to
The Court also sentenced King's wife, Patricia L. King, to three years probation for her role
On June 25, 2001 Jon King pleaded guilty to one count of conspiracy to commit securities,
That same day Patricia King pleaded guilty to three misdemeanor counts of providing false
Other defendants charged in the criminal case include Jon King's son, Michael J King, of
In a related civil enforcement matter, the Commission announced that the United States
The judgment, entered by U.S. District Judge Virginia A. Philips on July 28, 2000 after the
The judgment also enjoins American Telephone + Data, Inc. from violating the periodic
The complaint alleged that during 1993 Lynas and Hauxhurst-Lynas filed with the Commission a
Those financial statements included fictional assets, which resulted in the overstatement of
The Commission's enforcement action is part of the Commission's four-pronged approach to
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