For Immediate Release
November 7, 2007
Contact: Matt Carrothers
Director of Media Relations
Secretary of State Announces Guilty Pleas in Investment Fraud Ring
Atlanta – Secretary of State Karen Handel announced today that Lee Cash and Joey O’Kelley pled guilty on Monday, November 5 to multiple violations of the Georgia Securities Act and other laws. The pleas stemmed from a multi-agency investigation effort into Cash and Sons Insurance in Monroe, Georgia.
The investigation found that company owner Lee Cash collected over $65,000 in excess insurance policy premiums from one elderly couple and over $53,800 from two elderly sisters. Additionally, Cash and O’Kelley, an employee of the firm, sold over $2.6 million in promissory notes to their insurance customers. Cash and Sons also failed to register the promissory notes as securities, or to register employees selling securities with the Secretary of State’s Securities Division.
“We will aggressively pursue and prosecute any person or company that commits securities fraud against Georgians, especially Georgia’s seniors,” said Handel.
Cash pled guilty to 37 counts of violations of the Georgia Securities Act, 28 counts of theft by taking and 5 counts of insurance fraud. He has already paid $124, 671 in restitution to victims following administrative sanctions handed down by the Secretary of State. Cash now faces a 30-year sentence, including 8 years in prison, and must return another $2.45 million to fraud victims.
O’Kelley pled guilty to 57 counts of violations of the Georgia Securities Act and 27 counts of theft by taking. His 30-year sentence includes 5 years in prison and an order to return $2.2 million to victims. O’Kelley has already paid $65,000 in victim restitution.
The case against Cash and Sons Insurance was investigated by Securities Investigators in the Secretary of State’s Office, Special Agents in the Georgia Department of Insurance and an Auditor in the Georgia Bureau of Investigation. The case was prosecuted by the State Attorney General’s Office and the Walton County District Attorney.
This announcement is part of a continuing effort by the Secretary of State’s Office to investigate charges of securities fraud against Georgians. In October, Handel announced a consent agreement with Ameriprise Financial Services, Inc. that included significant monetary fines. Securities investigators found that Ameriprise failed to discover forged customer signatures on financial documents prepared by the firm’s salespersons. Investigators also identified deficiencies in the firm’s supervisory systems.
Secretary of State Karen Handel serves as the Georgia Commissioner of Securities. In that capacity, her office regulates the sale of securities within the state of Georgia. These securities may range from traditional common stocks and bonds to a broad range of more complex forms of investment contracts, limited partnerships, profit-sharing arrangements and hedge funds.