Simi Police Officer Pleads Not Guilty in Pyramid Scheme : Courts: Michael Cratch faces trial Nov. 20. Two other men admit to misdemeanor, with sentencing due Oct. 26.

A Simi Valley police officer pleaded not guilty in Superior Court on Tuesday to a felony charge of operating an illegal pyramid scheme, authorities said.

Officer Michael Cratch, 24, was scheduled to stand trial Nov. 20. If convicted, the three-year department veteran faces a maximum of three years in state prison.

Two other Simi Valley residents, Kevin Novack, 22, and Roland Tamparong, 23, each pleaded guilty Tuesday to a misdemeanor count of operating an endless chain scheme. Their sentencing is set Oct. 26.

Each faces a maximum of one year in County Jail, Ventura County Senior Deputy Dist. Atty. James D. Ellison said. Both have no criminal records and lost money on the scam, he added.

Authorities did not offer Cratch the option of pleading guilty to a misdemeanor charge, Ellison said.

“There’s a real question as to whether these people realized what they were doing was illegal, because they were [told by] police officers that this scheme was, in fact, legal,” he said.

Three other Simi Valley police officers remain under investigation. A fifth resigned from the force.

Two other people indicted last month by the Ventura County grand jury for their roles in the investment scam earlier pleaded guilty to misdemeanor counts of operating an illegal pyramid scheme, Ellison said. A sixth person indicted underwent open heart surgery Sept. 12 and is due to be arraigned Oct. 26.

Authorities arrested seven people in July for allegedly participating in the scheme, in which they put up $1,000 to $2,000. It is unclear how many people or how much money was involved, Ellison said.

About a dozen Simi Valley police officers had knowledge of the scheme, but most reported the scam to superiors, he said.

“The characterization [that] this thing has run rampant throughout the Simi Valley Police Department is erroneous,” he said. “Most of [the officers] showed good judgment in not getting involved.”

The Police Department is conducting an internal investigation that should be concluded within a month, Chief Randy G. Adams said.

Although another Simi police officer was indicted on a felony perjury charge in August, Adams does not believe that the department has serious internal problems.

“I knew there were these problems occurring,” said the chief, who joined the department Sept. 5. “The officers under investigation represent a small minority of the department and we’re going to make sure justice is done regarding these situations.”

Law enforcement officials are as susceptible as anyone else to get-rich-quick schemes, Ellison said.

“People are people regardless of their occupation, and I think we all fall prey to certain attractions,” he said.