FBI Arrests 3 in Precious Metals Fraud : Ex-Mission Viejo Family Held in Alleged $8.5-Million Embezzlement

LOS ANGELES-FBI agents Thursday arrested three members of a former Mission Viejo family who allegedly embezzled about $8.5 million from 2,000 U.S. and Canadian investors through a precious metals company.

Arrested in a Miami apartment building, the FBI said, were Todd E. Fisch, 25; his mother, Joan D. Fisch, 55, and his father, Joel H. Fisch, 56. They had been sought on warrants stemming from a federal grand jury indictment issued in Los Angeles on Oct. 2.

The indictment had remained sealed until the arrests to prevent the Fisches from fleeing, according to government prosecutors.

Three other employees of the company who lived in Orange County were also named in the indictment. The FBI identified them as Warren Sharp, vice president of sales; Ron West, assistant vice president, and Danny Hochstein, the company’s bookkeeper, and said they are fugitives.

The indictment charges each defendant with 46 counts of federal mail fraud and wire fraud and two counts of interstate transportation of the proceeds of a fraud.

Offices Closed in 1984

The company, First Trading Group Ltd., had offices in El Toro, San Diego, Los Angeles and Oakland that were closed in February, 1984, when the company moved to Vancouver, Canada. The move came shortly after the California Department of Corporations issued subpoenas for its business records. In all, 25 Orange County companies, suspected of selling illegal precious metals contracts, were subpoenaed.

First Trading relied on dozens of telephone salesmen and television ads to sell deferred delivery contracts for precious metals such as gold and silver, according to the indictment. Investors made a down payment on the metals, and their profits or losses depended on the selling price of the metal at a future, specified date.

Investors were told that their funds were protected in segregated bank accounts and that there were no interest, storage or other charges. However, “once FTG received the victims’ funds, they were embezzled by the defendants and improperly used for personal and business expenses, commissions, bonuses and prizes to the telephone solicitors, and for personal investment,” the indictment said.

When the Fisches learned that the company was being investigated by California officials, they moved to Canada and reopened under the name First Trading Group, British Columbia. While in Canada, the defendants continued to solicit money and to send customers false monthly statements, the indictment said. In April, 1984, the defendants mailed “false and fraudulent statements” stating that the investors’ accounts had lost their entire value and were closed out at a loss, the indictment said. “In or about 1984, the defendants closed their operations, shredded the records and fled the country,” according to the indictment.

Returned to U.S.

At some point, the family moved back to the United States, authorities said. Recently, the elder Fisches had been living in a luxurious penthouse apartment in North Miami, according to FBI spokesman Paul Miller.

Miller said the Fisches’ son, Todd, was arrested in an apartment he rented in the same building.

The family was operating a company called Suisse Atlantic Monetary Fund in Biscayne, Fla., when they were arrested. Suisse Atlantic was selling futures contracts for foreign currency, Miller said. The Florida state comptroller’s office issued a cease-and-desist order against the firm and shut it down on Thursday, Miller said.

Miller said that FBI agents found a semiautomatic gun in Todd Fisch’s apartment but that the family was arrested without incident.

The Fisches will be returned to California to stand trial, Miller said.