Want to mess with Alabamans in the securities fraud era? Don’t do it in Coffee County. A jury there took just 28 minutes to convict Scott Frye on five counts of selling unregistered securities or causing them to be sold.
That’s an average of 5.6 minutes of deliberations per count. The case was prosecuted by Coffee County District Attorney Tom Anderson and the Alabama Securities Commission.
Frye, who faces court action elsewhere in Alabama, initially avoided prosecution by fleeing to the Philippines. But he was arrested there after the United States revoked his passport and he became an undocumented alien on foreign soil, and Coffee County — which has a population of less than 47,000 — sent an investigator to bring him back from the Western Pacific to face trial.
Enterprise, the small Alabama city in which Frye’s two-day trial was conducted, is nearly 9,000 miles away from Manila, where Frye was arrested in 2009.
The Dothan Eagle reported on the 28-minute verdict. Other local media outlets such as WDHN have kept communities informed about the Frye case and have shown Frye being led from the courthouse in handcuffs.
Frye has been dubbed “the father of Internet fraud” — and it may be a richly deserved title. Though only in his early 40s upon his Alabama conviction this week, Frye’s name surfaces in SEC records dating back to 1995, when he was just 27.
One of the early pioneers of online fraud, Frye initially hatched a scheme that promised “riskless profits” from “investments in two Costa Rican enterprises,” the SEC said 16 years ago. The scam proved to involve what has been described as “coconut chips.”
Frye also was linked by Pennsylvania authorities to a securities scheme involving a device that purportedly would permit jewelers “to determine the exact quality and value of any gemstone.”
The Internet was so new back then that law enforcement felt the need to explain to judges what it was, and there was no general agreement about how the word best was presented in court documents. The SEC initially used an uppercase “N” in the third syllable.
“Frye has posted numerous messages on the InterNet, a decentralized web of computers, accessible to millions of potential investors across the country and world-wide, in which Frye has solicited funds from investors,” the SEC wrote in the 1995 Frye case.