Judge cancels hearing for man convicted of securities fraud

A court hearing set Monday for a man sentenced to 20 years in prison in connection with investment fraud was cancelled.

Circuit Judge Tom Head cancelled the hearing set for Feb. 2 after the state filed a notice of correction of sentence Jan. 29 in response to Scott Alan Frye’s request for a new hearing.

Head sentenced Frye, formerly of Knoxville, Tenn., to 20 years in prison April 13, 2011, for five counts of selling unregistered securities.

At that time, 12th Judicial Circuit District Attorney Tom Anderson and Joseph Borg, director of the Alabama Securities Commission, announced that Frye would be transported to Jefferson County, where he faced a 74-count indictment for multiple securities law violations and where investor losses exceeded $2.2 million.

There he was sentenced to 25 years in prison after pleading guilty to 10 counts of securities fraud, causing the loss of more than $1.1 million to 19 victims.

Head set a hearing for Feb. 2 in Coffee County for Frye, who is serving his sentence in the Alabama Therapeutic Educational Facility.

In a hand written letter to Head, dated June 17, 2014, Frye asked that his sentence in Coffee County and Jefferson County run concurrently, instead of consecutively.

The Coffee County charges against Frye were the result of an investigation by the American Securities Commission Enforcement Division and the discovery that Frye had obtained $44,500 through loans taken out against retirement accounts of several Century 21 Real Estate agents in Enterprise.

According to a statement from the Alabama Securities Commission in 2011, the investigation revealed that the money obtained by Frye from the real estate agents was purportedly used to purchase notes in a Bahamian land development scheme. The real estate agents, the ASC said, had no knowledge that the funds from their retirement plans were being used to purchase unregistered securities and that Frye was using the money for personal use.

The ASC investigation led to a five-count indictment being returned against Frye by a Coffee County Grand Jury in November 2005, but prior to the indictment being served, Frye fled to the Philippines.

Frye was arrested in Manila by Philippine authorities in October 2009. He was extradited to Coffee County March 19, 2010. “Due to the tireless efforts of (Anderson) and law enforcement authorities in the Philippines and in California, the crucial investigation performed by our enforcement agents, and excellent prosecution performed by our legal team, this financial predator no longer poses a threat to Alabama investors,” Borg said at that time.

Frye was one of four people charged, and the last to be arrested, in connection with fraud cases that occurred between July 2000 and March 2005 in Alabama, Indiana, Florida, Mississippi and Tennessee.

Five real estate agents at the Enterprise Century 21 office had participated in the retirement plan Frye’s partner presented.