Business briefs for March 19, 2002

Tuesday, March 19, 2002 | 10 a.m.

Vegas fraud figure ordered to pay $4.62 million

A federal judge ordered $4.62 million in restitution payments by Bryan Egan, the former president of Brycar Financial of Las Vegas, who was charged with bilking 550 investors out of millions of dollars in a Ponzi scheme.

U.S. District Judge Kent Dawson last week also ordered Egan, who was sentenced to 63 months in prison after pleading guilty in June to bank and securities fraud, to surrender himself to Nellis Federal Prison camp by April 19.

Egan, who acted as a loan broker for several small business owners and was accused of fraudulently obtaining about $2.35 million in loans from several banks, was ordered to pay restitution at a rate of 10 percent of his gross prison wages while incarcerated and 10 percent of his gross monthly wages while on supervised release.

Egan and his wife, Carol Egan, also known as Carol DeSalvio, and Brycar were sued in September by the U.S. Securities and Exchange Commission. The SEC said they illegally offered investors guarantees that their "risk-free" and "tax-free" investments in so-called "pre-IPO" stock and other securities would generate 500 percent returns.

LV hypnotist refused access to complaints

A Clark County District judge denied last week a request by Las Vegas hypnotist Marshall Sylver to subpoena complaints by customers who claimed they were refused refunds by Sylver after they failed to double their investment by following his self-help financial seminar "Millionaire Mentorship Program."

Sylver hasn't been charged with criminal violations but is suspected by the Attorney General's office of committing theft by obtaining money under false pretences and racketeering.

"(Clark County District) Judge Mark Gibbons rejected Sylver's request because of a confidentiality statute, which prevents disclosure of complaints to the state," said Tracey Brierly, deputy attorney general with the Attorney General's office of Consumer Protection.

Man imprisoned for Vegas mortgage scams

David Allan Van Velzer Jr., president of a Las Vegas mortgage loan company who was convicted in December of 29 counts of money laundering and wire fraud, was sentenced to 97 months in prison and ordered to pay $4.36 million in restitution to two financial institutions he defrauded.

Van Velzer, the president of American Mortgage Industries, was accused of improperly obtaining funds from Freddie Mac and Bank One Arizona from early 1996 through July 1997 by allegedly creating fraudulent loans and fictitious buyers whom he would represent to the lenders as people seeking loans to buy homes.

Van Velzer, who was found to have obstructed justice by trying to persuade two people to testify falsely on his behalf, was also ordered on Friday by U.S. District Judge Justin Quackenbush to be placed on supervised release for three years following his term of imprisonment.

More airlines cancel travel agent commissions

DALLAS -- American Airlines and Continental Airlines said Monday they would stop paying base commissions to travel agents for tickets sold in the United States and Canada.

The airlines' move, which took effect Monday, followed the lead of Delta Air Lines, which announced a similar change last week.

Airlines are trying to cut ticket-distribution costs and drive customers from travel agents to their Internet sites. Ticket distribution is the fourth largest expense for carriers after labor, fuel and aircraft, according the Air Transport Association, the industry's trade group.

The airlines had cut agents' commissions six times since 1995.

Richard Copland, president of the American Society of Travel Agents, said agents would survive by charging more transaction fees directly to customers. Those fees will increase the amount consumers pay to fly, but travelers should blame the airlines, not agents, he said.