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A father and son from Fountain Green have been jointly charged with 16 second-degree felonies in connection with a housing investment scheme that allegedly took more than $200 million from some 400 investors.
The Utah attorney general's office filed 15 counts of securities fraud and one count of pattern of unlawful activity against Wendell Jacobson, 61, and his son Allen Jacobson, 36, on June 22 in Salt Lake City's 3rd District Court.
Court papers show a judge has issued arrest warrants for both men, with bail set at $100,000 each. As of Monday, neither appeared to have been arrested and court records don't indicate whether either Jacobson has an attorney.
No hearings are set in the case.
The Salt Lake Tribune's efforts to reach both men by telephone on Monday were unsuccessful.
The charges follow a multi-agency investigation that included the FBI, the Securities and Exchange Commission and the Internal Revenue Service, according to a news release from the attorney general's office.
In court papers, investigators say the Jacobsons offered investment opportunities in limited liability companies through direct or indirect ownership in multi-unit apartments in at least eight states.
Prosecutors contend the pair promised investors the low-occupancy complexes would be bought at discounted prices and then renovated and sold over a period of five years. Returns were promised at rates of 5 percent to 8 percent and investors were told the Jacobsons had a "track record" of earning returns as high as 15 percent in the past.
Court papers say the father and son began selling membership interests in an umbrella company for the LLCs in 2008 and by 2011 had raised more than $200 million, soliciting funds both personally and through word-of-mouth referrals.
"The Jacobsons also appear to have used their religious affiliation and connections arising therefrom to find and obtain trust of prospective investors," court paper say.
Prosecutors also alleged that investors were falsely told that Wendell Jacobson or one of his companies had contributed at least 50 percent of the funding for each LLC and that he had never lost money on any property.