Conviction Upheld in Fake Scheme to Collect Ransom

The conviction of a local man who helped a young woman trick her parents into turning over hundreds of thousands dollars in a fake ransom plot was upheld on appeal Monday.

The 4th District Court of Appeal in Santa Ana rejected arguments by Steven C. Hagen that he had been harmed by legal errors when he was convicted in 1987 of conspiracy and extortion and sentenced to three years in prison.

Hagen, 40, acted as a go-between in exchanging ransom notes and money between Louis and Grace Arnold of Los Alamitos and the supposed “kidnapers” of their daughter, Mary Beth Lara, now 38. Lara is also serving a three-year sentence.

Starting in about 1984, prosecutors said Lara devised a scheme to fake her own kidnaping, persuading her parents that she was in the hands of drug dealer to whom she owed money.

For about the next two years, Lara, Hagen and another friend sent the Arnolds about 150 ransom notes and extorted up to $300,000 that the three used to support their drug habits, prosecutors maintained.

Louis Arnold suffered a fatal heart attack in July, 1986, apparently while reading one of the ransom notes. The family has said it has been virtually wiped out financially.