Broker Receives 1-Year Term for Securities Fraud : Crime: Ex-Laguna Beach mastermind of scheme is also ordered to pay $207,000 in restitution to 2 of his victims.

A former Laguna Beach stockbroker has been sentenced to a year in prison and ordered to pay $207,000 in restitution to two victims for masterminding a securities and mail fraud scheme.

David O. Naulin, 33, now of Huntington Beach, is scheduled to begin serving his prison term Jan. 14, according to the U.S. attorney’s office in Los Angeles.

Naulin, who pleaded guilty a year ago to felony charges involving unauthorized trading in speculative options and index securities, is the 15th defendant to be convicted as a result of investigations by the Southern California Securities Fraud Task Force.

The task force was created in April, 1989, as part of a national effort ordered by U.S. Atty. Gen. Dick Thornburgh to protect investors from securities scams.

“Frequently, these cases are straight rip-offs, where the stockbroker uses the funds to take a luxury cruise or to go to Las Vegas to gamble,” said James R. Asperger, chief of the U.S. attorney’s major-frauds division. “But this one was a little different.”

Naulin committed the fraud in early 1988, Asperger said, in an effort to cover other trading losses. In the process, Naulin victimized Curtis Walker, a friend and former neighbor in Laguna Beach, as well as the Diehl & Co. brokerage in Newport Beach, where Naulin had a trading account.

Naulin took more than $150,000 from Walker to invest in less-speculative securities through Naulin’s account at Diehl. He even gave Walker a Diehl & Co. monthly account statement showing a balance of $289,181.88, Asperger said. But Naulin had altered a photocopy of the statement to hide the fact that the true account balance was zero, the prosecutor said.

At the same time, Asperger said, Naulin failed to pay Diehl $97,000 that he owed the investment firm for futures contracts that had expired. A check for that amount had bounced, said Russell Diehl, owner of the securities firm. Diehl eventually received $40,000 from Naulin’s relatives.

In sentencing Naulin on Monday, U.S. District Judge Mariana Pfaelzer ordered him to pay Walker $150,000 and Diehl $57,000. The yearlong delay in sentencing was caused by a change in defense attorneys and procedural matters, Asperger said.

“It’s a sad event, a sad story for all the people involved,” Diehl said.