R. Dean Udy, 71, a former stake president and regional representative in Brigham City, Utah was sentenced to 1-to-15 years in state prison last week on securities fraud charges. He pled guilty to a scheme that ran for 12 years or more. According to the article in the Ogden Standard Examiner, “Udy’s victims total 1,500, with an estimated loss of $20 million.”
Prosecutors alleged that Mr. Udy “traded on his positions in The Church of Jesus Christ of Latter-day Saints, which included membership in a stake presidency and as a regional representative in Box Elder County” to gain people’s trust. “People felt Brother Udy would never do anything wrong.”
So what is the lesson here? If anyone uses their church position (explicitly or not) to gain your trust in connection with an investment pitch — run for the hills. Don’t trust anyone just because they are a church leader or even a church member. Do your homework and check out the individual, the company and everyone connected with the potential investment opportunity on the Utah Division of Securities, FINRA and the SEC databases.
Mr. Udy first entered into a Consent Order with the Division of Securities in 2002, but that didn’t slow him down. He was then charged criminally in 2005 and pled guilty to two felony criminal counts in 2007. However, that sentence was held in abeyance for 36 months after he agreed to pay full restitution to his investors and to provide accurate information to the State about those investors. But that didn’t happen, and it took several years for the judge to lose patience with him and send him to jail.
In June a federal grand jury indicted him and his son, Cameron, for charges alleging they ran a $11.4 million in bank fraud in Las Vegas, and they face trial on that charge in October.
Copyright 2010 by Mark W. Pugsley. All rights reserved.