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Three former executives of the defunct Westhaven Group were taken from a Lucas County Common Pleas courtroom in handcuffs yesterday after they pleaded not guilty to racketeering and security fraud charges.
Scot Ulmer, Roger Morr, and Anthony Garzony are charged with multiple counts after being accused of violating the state's securities law.
Each of the defendants also is charged with engaging in a pattern of corrupt activity under the Racketeer Influenced and Corrupt Organizations (RICO) Act, which carries a mandatory 10-year prison term.
They and Westhaven founder John Ulmer were named in an 81-count indictment handed up last month by a grand jury and are accused of defrauding more than two dozen investors of more than $1.6 million from January, 2002, through December, 2005.
Prosecutors said Westhaven failed to match the stakes of investors' money with mortgages of equal value and failed to disclose to investors that the company was insolvent.
John Ulmer, the father of Scot Ulmer, was arraigned April 18 and released on a $160,000 property bond.
During yesterday's brief hearing before Judge Stacy Cook, the defendants said very little as they stood with their attorneys.
Scot Ulmer, 31, of 4830 West Bancroft St. was released on a $110,000 property bond. His aunt, Barbara Neal, posted her home in West Toledo for his release.
He was president of Westhaven from 2001 until the company's collapse.
Morr, 64, of Delta, Ohio, and Mr. Garzony, 47, of 2615 Underhill Rd., Ottawa Hills, were released on their own recognizance.
Judge Cook ordered each of the defendants to surrender his passport.
Mr. Garzony worked for the firm from August, 1998, until January, 2003.
Judge Cook did not select a date for a trial. The defendants were told to return to court June 16 for a pretrial hearing.
The younger Ulmer is being held in a halfway house as part of his sentence in U.S. District Court in Toledo for forging lead-based paint disclosure forms for houses and rental properties of the defunct investment firm.
Westhaven Group bought, repaired, and sold blighted houses and at one time owned more than 300 properties in the county.
The state Commerce Department shut down Westhaven for securities fraud in December, 2005, when court-appointed receivers took control of the firm and began liquidating its assets.