Man Indicted in Alleged Ponzi Scheme

A Newport Beach man was indicted on charges of swindling 400 victims out of more than $10 million by persuading them to invest in three supposedly high-tech companies he controlled, the U.S. attorney’s office said Friday.

Steven P. Hevell, 38, taken into custody Wednesday night, was ordered held without bond as a flight risk following a hearing before a federal magistrate Thursday.

Hevell is scheduled to be arraigned April 30 on a 25-count indictment accusing him of 12 counts of mail fraud and 13 counts of money laundering, said Assistant U.S. Atty. David A. Hoffer.

Hevell’s attorney, Diana Cavanaugh, couldn’t be reached for comment.

According to the indictment, investors nationwide were solicited between 1994 and 1998 for Hevell’s MicroWest Industries Inc., Advanced Identification Technology Inc. and Consolidated Imaging Centers Radiology Network Inc.

The companies purportedly acquired and sold computer components and supposedly developed a system to transmit fingerprints electronically.

But the indictment alleges that no such high-tech operation or fingerprint system existed.

Investors’ money instead went to pay telemarketers who promoted the scheme and to pay interest at 14% and 17.5% to earlier investors, according to the indictment. Hevell also issued stock, promising investors his operations would soon go public--another misrepresentation, according to the indictment.

“There were no revenues in any of these businesses. It appears to have been a telemarketing scam, a Ponzi scheme,” using new investments to pay off earlier investors, Hoffer said.

Hevell previously settled two fraud lawsuits brought by the Securities and Exchange Commission. One involved MicroWest.