La Jolla Man, 2 Others Held in ‘Boiler Room’ Fraud

NEWPORT BEACH —  A La Jolla man is among three telephone salesmen arrested in connection with a clandestine “boiler room” fraud that swindled at least $250,000 from 20 customers who thought they were investing in silver and platinum futures, authorities said Friday.

U.S. Postal Service inspectors and Newport Beach police arrested three suspects, all of whom had worked for Eastern Financial Services, an unregistered precious-metals telemarketing business that operated out of several locations in Newport Beach from late 1987 through January, 1989, according to Newport Beach Police Lt. Tim Newman.

The owner of EFS, Eric M. Dickey, was arrested last January on three counts of wire fraud. Dickey was convicted and sentenced to four years in federal prison while the investigation continued.

Newman said investigators arrested Michael J. Mears, 27, outside his La Jolla home early Thursday morning, then took James D. Murdoch, 26, of Newport Beach into custody Thursday afternoon at his work in Newport Beach. Robert L. Daigle, 27, of Garden Grove, was arrested Friday morning at the same Newport Beach firm when he arrived to get his paycheck, Newman said.

All three were booked on suspicion of telemarketing fraud and were being held in the city jail in lieu of $10,000 bail.

Newman said the three used “classic high-pressure telephone sales” to cheat at least 20 clients out of a total of $250,000. They face charges of grand theft, conspiracy, and telemarketing fraud and federal charges of mail fraud and wire fraud, he said.