Scammed investors to get $15.3 million

Wednesday, August 23, 2006 By Peter H. Milliken VINDICATOR STAFF WRITER CLEVELAND — A federal judge has ordered the Prokop insurance father-daughter team to make more than $15.3 million in restitution to investors. U.S. District Judge Donald C. Nugent issued the order Wednesday against John E. Prokop, 77, of Barbie Drive, and his daughter, Lisa (Rosati) Tokarsky, 45, of Samuel Court, both of Boardman. Last month, Judge Nugent sentenced Prokop and Tokarsky to a year and a day in federal prison, followed by three years' probation, and ordered them to make restitution. The U.S. Attorney's office filed under seal in this case a list of about 500 investors. At the sentencing hearing in Youngstown, the packed courtroom included many investors, some of them supportive of Prokop and Tokarsky and others complaining they lost their life's savings in their investments with the pair and asking the judge to impose maximum sentences. Making restitution was one of the terms in the plea agreements for Prokop and Tokarsky, who were well-known for selling "guaranteed, no-risk" investments from Pro Insurance through radio and TV ads. The pair were indicted on more than 30 fraud and money laundering charges, but pleaded guilty only to lying about clients' investments. Prokop pleaded guilty to four counts of making false declarations under oath and his daughter pleaded guilty to two counts of the same offense. The plea agreements don't prevent civil lawsuits or state criminal charges, the plea agreements say. Fraud and money laundering charges were dismissed in exchange for the duo's guilty pleas April 28. The false statements were made during depositions in 2005 in a civil lawsuit brought by investors from Youngstown, the government said. The case involved an alleged scheme to defraud investors in pay phones, viatical insurance contracts and automated teller machines. The indictment, returned last August, states that from 1997 to 2002, the duo conspired to commit mail, wire and securities fraud. The indictment alleges that Prokop and Tokarsky falsely claimed in their advertisements that the non-traditional investments they sold had no risk and guaranteed a high rate of return. The government said they sold more than $9.8 million in pay phones, $6.2 million in viatical settlements, and $855,000 in ATMs and collected nearly $2 million in commissions.