U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 18439 \ October 31, 2003.
DEFENDANT IN SEC FRAUD ACTION CONVICTED IN CRIMINAL CASE
FEDERAL JURY FINDS DEFENDANT GUILTY IN CASE BROUGHT BY UNITED STATES ATTORNEY'S OFFICE
United States v. Paul R. Johnson and John Cook, Criminal Action No. 02-60012-CR-Ferguson (S.D. Fla.)
The Securities and Exchange Commission (SEC) announced that on October 31, 2003, a jury returned a guilty verdict in a criminal case against Paul R. Johnson. The SEC had previously brought a civil case against Johnson, alleging that he and other defendants had illegally raised over $15.5 million from nearly 400 investors for Link Express Delivery Solutions, Inc. (Link Express). During the time of his misconduct, Johnson was the president and CEO of Link Express.
The United States Attorney's Office for the Southern District of Florida (USAO) brought criminal charges against Johnson, and another defendant John Cook, following a coordinated investigation with the SEC, the FBI, the IRS, the Florida Department of Law Enforcement and the Florida Department of Banking and Finance. Among other things, the indictment charged Johnson with conspiracy to commit securities fraud, securities fraud, and money laundering. The indictment also charged Johnson with perjury for making false declarations during a hearing to freeze assets in the SEC's case against him.
The indictment charged Johnson with fraudulently raising funds for Link Express, and charged him with inducing investors to purchase stock by falsely representing that all funds raised would be used for operating, acquisition, and administrative expenses associated with Link Express' package delivery service. Instead, 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 jury found Johnson guilty after an eight week trial conducted by the USAO with assistance from the SEC. The jury acquitted co-defendant, John Cook.
For more information on previous actions in this matter, see Litigation Release No. 17277 (December 17, 2001), Litigation Release No. 17338 (January 24, 2002), Litigation Release No. 17375 (February 22, 2002), Litigation Release No. 17819 (October 30, 2002), and Litigation Release No. 17874 (December 3, 2002).