Indiana Investors Face Possible $1.6 Million Fraud Loss

Two men, Martin McClary of Indiana, and Parry Wayne Clark of Florida, stand accused of bilking more than $1.6 million from 33 investors to whom they’d promised “big returns.” In some cases, the duo even promised prospects the chance to double their money in a year. However, through shell companies, McClary and Clark took in money and used it in ways the investors hadn’t agreed to.

The duo now faces 23 felony counts for securities fraud, and for violations of securities registration and broker-dealer registration laws.

Most of the investors were from the Johnson County, Ind. region, according to the news site. Some cash came from families who put up tens of thousands — and even hundreds of thousands — of dollars taken from retirement savings accounts. (Investors included both past and present Johnson County commissioners.) One family put up $450,000, believing it could withdraw up to $40,000 annually (for retirement) if it left the initial sum untouched for a year.

To make the scheme work, the article says McClary and Clark promoted a startup company called Prosidian, based in Florida, which was supposed to sell medical malpractice insurance. However, Prosidian proved to be only a shell company that didn’t have an insurance license, and lacked the "big-name" investors Clark claimed it had.

McClary raised money for Prosidian from Indiana investors, some of whom he’d met in church and some he’d known for years. McClary told his prospects he had business experience and had put up a half million of his own money for Prosidian. To accept investments for Prosidian, McClary even created a holding company, called Prosperity Capital Enterprises.

While McClary told his clients that Prosperity Capital had an office in Greenwood, Ind., he used an existing mailing address as its location. McClary then sold investors ownership stakes in the insurance company. However, in late 2010, investors learned that because of difficulties securing a license in Florida, Clark would dissolve Prosidian.

The investors subsequently were unable to reach McClary or Clark. After an investor lodged a complaint with the Indiana State Police, a criminal investigation started. Investigators learned the cash raised had never gone into an insurance company, as promised. Instead, McClary and Clark took it for themselves, repaid some investors, or made payments to CitiCard. The two men weren’t registered in the state to sell investments; they also had never registered any of the investments in Indiana, as the law requires.

According to the WishTV article, Clark claimed to be a victim himself. McClary was unavailable to comment, but previously had informed investigators he was Clark’s employee. In March, both men will face pretrial hearings. An Indiana secretary of state spokeswoman said prosecutors would seek to regain the lost money for investors.

Have you been exploited in a securities fraud scam? Call Sokolove Law today for a free legal consultation about a securities fraud lawsuit.


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