Financier Held on Bail of $2.5 Million

The alleged mastermind of what prosecutors call the largest fraud scheme perpetrated in Ventura County history turned himself in Friday and is being held on $2.5 million bail.

Thousand Oaks real-estate financier Olen B. Phillips, 51, appeared at Sheriff’s Department headquarters in Ventura about 2 p.m., Detective William Hammer said.

Phillips and two employees of his company, the Phillips Financial Group of Agoura Hills, were indicted Wednesday on charges of conspiracy, grand theft and securities fraud. Investigators say about 2,000 investors stand to lose as much as $30 million invested with the company, but the 81-count indictment deals only with 21 people who allegedly lost $3 million.

Investigators said the defendants sold limited partnerships in various properties and then encumbered the properties with trust deeds without the knowledge or approval of the limited partners. The liabilities far exceeded the value of the properties, investigators said.

The other two defendants, Charles J. Francoeur and Felix J. Laumann, were arrested Thursday night. Hammer said Phillips apparently “turned himself in as soon as he heard about it.”

Phillips and Laumann will be arraigned Monday before Superior Court Judge Allan L. Steele.

Francoeur’s arraignment, scheduled for Friday, was postponed one week so his attorney, Michael D. Nasatir of Santa Monica, could study the indictment.

Nasatir said Francoeur’s $1-million bail is “totally out of line” and asked Steele to lower it to $100,000. Nasatir said Francoeur is a “family man” who has cooperated in the 15-month-long investigation and has no prior record.

But Steele denied the request until probation officials could look into Francoeur’s background.

Deputy Dist. Atty. Rebecca J. Riley said in an interview that Francoeur was senior vice president of Phillips’ company. “Every transaction went through his desk,” she said. “He ran the company when Mr. Phillips was gone.”

Nasatir declined to comment until he has read the indictment, except to say that Francoeur will contest the charges.

Riley said the three men used funds from new investors to pay interest to old investors and keep their alleged scheme afloat. She said there is evidence indicating that they hoped for a turnaround in the real-estate market that would greatly boost the value of the properties and enable them to meet all of the obligations.