News: 2011 Press Release
For Release: October 27, 2011
Media Calls Only: 916-492-3566
Insurance Commissioner Dave Jones Announces Arrests Of Southern California Husband, Wife And Indiana Mother
Ponzi scheme allegedly bilked investors out of $2.5 million dollars
Insurance Commissioner Dave Jones announced today that Anthony Trae Carlson, 42, Mariah Waterfall O'Brien, 40, and Arvina Joyce Carlson, 68, were recently arrested and have been charged with violating multiple sections of the Penal Code and Corporations Code.
"This family conspired to rip off honest investors," said Insurance Commissioner Dave Jones. "Thankfully, they were apprehended before defrauding additional victims."
Anthony Carlson was charged with 40 felony counts, his wife Mariah O'Brien and mother Arvina Carlson were each charged with 23 felony counts. All three were charged with violating Penal Code Section 487 (a), Grand Theft, violating Corporations Code Sections 25110/25540 (a), necessity of qualification of security or transaction, violating Sections 25401/25540 (b), sale or purchase of securities by means of written or oral communications containing false statements or omissions and also violating section 25541, use of a device, scheme or artifice to defraud.
Bail for Anthony Carlson has been set at $2.5 million dollars. Bail for both Mariah O'Brien and Arvina Carlson has been set at $1.9 million dollars. If convicted on all counts, Anthony Carlson faces a maximum sentence of 27 years, 8 months in state prison while both Arvina Joyce Carlson and Mariah O'Brien face a maximum sentence of 21 years in state prison.
According to California Department of Insurance (CDI) Investigators, between February 2005 and December 2008, all three suspects participated in an elaborate Ponzi scheme to defraud victims out of their investments. Each suspect represented to the victims that they either owned or had invested in an insurance company involved in the bail industry which they called State Bonding California. The investigation revealed that the suspects made several misrepresentations or omissions that the company conducted business in over 44 states and produced over one billion dollars in annual revenue.
At least one suspect used fraudulent multimillion dollar State Bonding California dividend checks to persuade victims to invest in the bogus company. Investments were offered to victims in the form of the sale of "membership interests" in State Bonding California. The investments were supposedly guaranteed with returns ranging between 19 to 21 percent. The suspects collected at least $2,514,650 from three different couples and one individual.
State Bonding California was never licensed to sell insurance by CDI nor was it licensed to offer securities by the California Department of Corporations. The investigation revealed that the only address associated with the company was a post office box located in Hollywood. In addition, none of the defendants were licensed to offer securities in the State of California. Investigators later determined that some of the monies collected from the victims were used to fund a lavish Hollywood lifestyle being lived by Carlson and his wife, O'Brien in the hills of Los Feliz, CA.
This case was investigated by the California Department of Insurance - Investigation Division's Los Angeles Regional Office and is being prosecuted by the Los Angeles County District Attorney's Office - Major Fraud Unit.
The California Department of Insurance, established in 1868, is the largest consumer protection agency in California, regulating the $123 billion insurance marketplace. In 2012 the California Department of Insurance received more than 160,000 calls from consumers and helped recover over $64 million in claims and premiums. Please visit the Department of Insurance web site at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.HELP. Out-of-state callers, please dial 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.
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