O.C. Firm Ordered to Pay $3 Million in Fraud Case

An Orange County company accused by federal regulators of defrauding investors with false claims has been ordered to repay $3 million, the Securities and Exchange Commission said Monday.

U.S. District Judge Christina A. Snyder issued a summary judgment March 4 against Microwest Industries Inc. and related companies, the SEC said. One of several individual defendants in the case, sales representative Thomas J. Perkins, was fined $5,500.

William Hinz, a lawyer for the defendants, declined to comment.

Microwest, once based in Irvine, has changed its name to CIC Radiology Inc. and is now based in Santa Ana, said Gregory C. Glynn, senior trial counsel for the SEC in Los Angeles.

In a case filed in September, regulators accused Microwest of making false claims about its ability to assemble and repair computers and transmit X-rays digitally. SEC court filings said Microwest attracted 191 investors nationwide, but that its stated businesses “were total fiction.”

Microwest simply “used the incoming investor funds to repay earlier investors in true Ponzi-scheme fashion, all the time making ever more glowing representations about the success of the nonexistent business,” the SEC said.

Cases are pending against several defendants, Glynn said.