This is an archived article that was published on sltrib.com in 2015, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.
A Highland man pleaded guilty Thursday in a fraud case in which he admitted obtaining about $2 million from investors by lying to them about the success of his medical personnel placement company.
When he was pressed to return the money, Ryan Lynn Cook, 35, last month tried to get one of the investors to meet him in the West Desert, where he claimed the government had kidnapped his software developer and stolen his truck. In a later call, he asked the investor to "come out to the West Desert and take his (Cook's gun) from him or Cook was going to do something drastic," according to an affidavit from FBI Special Agent James Malpede.
The investor called 911 and officers found Cook with three guns in his possession. He was arrested and hospitalized, court documents say.
Cook on Thursday pleaded guilty to one count of securities fraud involving his company HelpMed Inc. He agreed to a two-year prison sentence with two years of probation and to repay investors $1.97 million.
Cook admitted he falsely told investors that HelpMed earned $3.8 million in revenue when it had no income. He also claimed that the company had 12,000 health care providers in its system who could be connected to hospitals and clinics that needed personnel, when it had only about 100.
He also said HelpMed had signed up about 8,000 hospitals and clinics when it had only five hospitals, court documents show.
Two of the victims were veteran investors, one the managing director of a venture capital firm; the other routinely put capital into start-up companies, according to documents.
During the investigation into HelpMed, Cook set up conference calls with people who supposedly worked at two health care facilities. They gave HelpMed glowing reviews, but later calls to the two entities later revealed the two people on the call did not work there and that the facilities had no relationship with Cook's company.
Another investor worked with Cook for two months and saw that Cook appeared to be talking on the phone with customers most of the days.
After Cook was confronted by investors who had learned the company actually lacked clients, he told the investor that the FBI was knocking at his door and the Department of Labor had agreed to pay him $40,000 a month for access to the data and software of HelpMed.
But Cook claimed that because he had broken a non-disclosure agreement about the deal, he had committed treason and the Labor Department deal had soured. Cook said his office was bugged and his cellphone tapped by the federal government.
Bank records show that Cook transferred investor money to family and friends, with about half of the money going to his uncle, Richard Larsen of Rexburg, Idaho, from whom the Securities and Exchange Commission is seeking a return of the monies as part of a separate lawsuit against Cook.
He also bought a house in Highland for $549,111 and a Lexus for $65,715 using investor monies, the SEC alleged.
While Cook was in the hospital, an investor called him and recorded the conversation. Cook said his uncle had agreed to lend him money for his business, but admitted he had used it to maintain his lifestyle instead. He also said he lied to his wife about revenue that the company was supposedly earning.
"I lied to her and told her that I had checks coming in and that things were working out well and the more I told her that, the more demands kept happening and the more things I kept taking out, more money I took," he said, according to the Malpede affidavit. He also said he used investor monies to pay back his mother and others from whom he had borrowed.
U.S. Magistrate Judge Dustin Pead set sentencing for Sept. 9.