Disappearance of Ex-Executive Prompts Probe

Authorities said Friday that they have found evidence of a crime, possibly murder, in the disappearance of a one-time insurance executive who prosecutors say swindled as much as $11 million from hundreds of investors.

Arthur Lee Evans, 34, was last seen at his Cowan Heights home at 10492 Ridgeway Drive on Monday afternoon, said Lt. Dick Olson of the Orange County Sheriff’s Department. His department began investigating Wednesday evening after receiving phone calls from Evans’ friends.

In January, Evans was sentenced to one year in jail after pleading guilty to stealing or misusing funds from his now-defunct Republic Insurance Brokers Inc. Evans was ordered to begin serving the sentence in March, but a number of stays have delayed the start of his jail term.

A suspect in Evans’ disappearance was taken into custody for questioning Wednesday night, Olson said. He refused to release the name of the suspect, saying that to do so would jeopardize the investigation.

Evans, along with his wife, was arraigned in 1982 for grand theft for stealing $100,000 from Republic Insurance Brokers Inc., once the largest brokerage in Orange County. In addition, the two faced a state Department of Insurance complaint that they diverted at least $1.05 million from the insurance firm into their own pockets and into three firms they operated.

According to Orange County prosecutor Guy Ormes, Evans pleaded guilty in January, 1984, to four counts of grand theft and additional charges of excessive taking. Ormes estimated the total funds missing at “just over $2 million,” including $450,000 from two individuals.

“There are literally hundreds of people whom he borrowed from . . . totaling $11 million . . . give or take a couple of million,” Ormes said.

Several of Evans’ former associates say they are not surprised by his disappearance.

“I think he got in pretty bad company sometimes,” said Al Leatherby, who sold Evans Republic Insurance and personally lost $600,000 when the company folded in May, 1982. “There are some people who hated him enough to kill him . . . he hurt people very badly.”

Leatherby added that he would not be surprised if Evans disappeared to avoid his jail sentence.

Evidence of a Crime

Olson said officers have found evidence of a crime, possibly a murder, in Evans’ home and have sealed off the grounds and the street immediately in front of the house while the investigation continues. Officers with police dogs were searching the surrounding hills.

Neighbors, meanwhile, have become curious and somewhat uneasy about the 3-day-old police operation.

“There are strange things going on,” said one, who asked not to be identified. “Everything is hush hush,” she continued, referring to the lack of information being given by detectives.

Apparently, few people in the neighborhood know Evans personally.

One neighbor, Joan Henderson, described Evans as “reclusive.” Another said he was not the “normal neighborhood-type” person in that no one on the street seemed to know him.

Some neighbors said they heard gunshots Wednesday evening.

Times staff writer Jerry Hicks contributed to this story.