SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 17375 / February 22, 2002
United States v. Paul R. Johnson and John Cook, Criminal Action No. 02-60012-CR-Ferguson (S.D. Fla., January 29, 2002)
UNITED STATES ATTORNEY'S OFFICE INDICTS TWO SUED BY SEC FOR SECURITIES LAW VIOLATIONS
The Securities and Exchange Commission (SEC) announced that on February 21, 2002, the United States Attorney's Office for the Southern District of Florida (USAO) unsealed a 35 count indictment against Paul R. Johnson, the president and CEO of Link Express Delivery Solutions, Inc. (LEDS), and John Cook II, the owner of Argus Securities, Inc., a securities broker-dealer headquartered in New Port Richey, Florida. The SEC had filed a civil complaint against Johnson, Cook, and others on December 12, 2001, alleging that they illegally raised over $15.5 million from nearly 400 investors funds for LEDS, a South Florida package delivery service.
The indictment charges Johnson and Cook with conspiracy to commit securities fraud, securities fraud, and conspiracy to commit money laundering. The indictment also charges Johnson with money laundering, conspiracy to commit bank fraud, and perjury. One perjury count charges Johnson with making false declarations during a hearing to freeze assets in the SEC's case against him.
The indictment charges Johnson and Cook with fraudulently raising funds for LEDS and its successors and related businesses Link Worldwide Logistics, Pony Express Logistics, and Silver State Vending (OTCBB: SVEA). The indictment also charges that Johnson and Cook induced investors to purchase stock by falsely representing that all funds raised would be used for operating, acquisition, and administrative expenses associated with LEDS's package delivery service, when Johnson actually used the money for himself, his close friends and relatives, and his own personal ventures. The SEC's complaint in Securities and Exchange Commission v. Paul R. Johnson, et al., Case No. 01-7874-CIV-Hurley (S.D. Fla., filed December 12, 2001), is based on the same misconduct described in the USAO's indictment.
The Commission thanks the U.S. Attorney's Office for the Southern District of Florida, the Federal Bureau of Investigation, the Internal Revenue Service, the Florida Department of Law Enforcement, and the Florida Office of the Comptroller, Division of Securities, for their assistance and cooperation in this matter.
For additional information, see SEC Release No. 17277 (December 17, 2001).