Ex-Costa Mesa Man Indicted on Fraud Counts : Crime: The 39 counts of mail and securities fraud allegedly involved 35 people who were bilked of $1.3 million; some victims investing with Alpha Trust were ensnared at church, officials said.

Federal prosecutors said Thursday that a grand jury has indicted a former Costa Mesa man on charges that he bilked $1.3 million from 35 investors, including some people he ensnared at church.

Robert J. Corsaut, 46, now of Tulsa, Okla., was charged with 39 counts of mail and securities fraud in connection with his former firm, Alpha Trust, which prosecutors now say was nothing but a scam operation.

Alpha Trust was formed in January, 1988, and managed to collect more than $1 million from investors before it was put into receivership 18 months later at the request of the Securities and Exchange Commission.

Assistant U.S. Atty. John Walsh said Thursday that Corsaut attracted investors--most of them from Orange County--through word of mouth and that many of his clients were members of the Joy Christian Fellowship in Costa Mesa. “There is a sizable percentage of people who were members of the church,” Walsh said.

The indictment alleges that Corsaut and his immediate family took nearly $300,000 of investor money and spent another $700,000 of investor funds for unauthorized purposes. “By June, 1989, the assets of the fund totaled less than $300,000, the remainder of the money having been squandered by the defendant and others,” the indictment says.

Federal prosecutors allege in the indictment that Corsaut routinely lied to investors including telling them that their money was completely safe, that his employees were not receiving commissions, that Alpha Trust paid a 12% annual interest rate and that every investment would be fully secured by bonds.

The indictment alleges that Alpha Trust didn’t have any bonds at all for eight of the 18 months it was in existence. Employees were paid commissions, the indictment claims, totaling $209,543, or about 15% of the funds invested. Finally, federal prosecutors claim some investors were paid interest but it came from their principal.

The SEC last year sued Corsaut on fraud charges. The case was settled when Corsaut, without admitting guilt, signed a consent decree agreeing not to violate anti-fraud provisions in the future.