Officers Seek Evidence of Fraud in Raid

Law enforcement officers raided two Orange County companies Wednesday looking for evidence related to a scheme that allegedly defrauded more than 100 investors of over $4 million.

Investigators are looking for Robert L. Syrax, who ran two businesses, Gecko Holdings of Irvine and RLS Consulting in Costa Mesa. The companies solicited money from people to invest in what turned out to be a nonexistent online gambling venture, authorities said.

Officials seized documents and equipment relating to the fraud at one residence and the two businesses where the federal search warrants were served, but none of the 25 employees of the companies was there, said Sgt. Lloyd Downing of the County of Orange Boiler Room Apprehension Task Force, a multi-agency organization that targets telemarketing fraud.

“Everyone had picked up and left,” Downey said. “They knew we were coming. Obviously, someone informed on us.”

The companies ran telemarketing operations that offered to sell investors stock in the online gambling business, promising that the company would go public by mid-June, authorities said. The stock was priced at $2 a share, and investors allegedly were told the company anticipated that the shares would trade in the $6 to $8 range.

Along with the prospectus for the stock, investors received newspaper articles hyping the potential for Internet gambling and how Internet companies “defy IPO gravity,” authorities said.

But the company “had no intention whatsoever of going public. They were never registered with the Securities and Exchange Commission and they had no business license,” said Downing.

Warrants to search other locations have also been issued, Downey said, and several bank accounts containing several hundred thousand dollars will be frozen.

Also seized was a 1999 Silver Spur Rolls Royce valued at more than $175,000 for which Syrax paid cash, Downey said. Syrax has another Rolls Royce, but it has not been found, Downey added.

Charges have not been issued against anybody related to the scheme, Downey said.

At least two investors lost more than $200,000 each, Downey said.

“They get hooked in,” Downey said. “After you’ve given $25,000, you don’t want to believe you’ve gotten ripped off, and you give more.”