CONTACT

Ken Lane, 303-866-5632
Fred Joseph, 303-894-2320

Denver—Attorney General Ken Salazar and Securities Commissioner Fred Joseph announced today that criminal charges have been filed against an Englewood man connection with an alleged scam selling stock in non-existent companies.

Commissioner Joseph’s office received a complaint against Gerald Milner, age 32, earlier this year. Upon investigation, the Division of Securities referred the matter to the Attorney General’s office for possible legal action. Salazar’s office obtained a statewide grand jury indictment on November 12, 2004 against Milner, charging him with six counts of securities fraud (class 3 felonies), two counts of theft from an at-risk adult (class 3 felonies), one count of computer crime (class 4 felony). Four alleged victims from Arapahoe and Denver Counties with losses of approximately $87,000 have been identified so far (People v. Gerald Milner, Case. No. 04CR2940, Arapahoe County District Court).

Salazar and Joseph urge other possible victims to contact the Colorado Division of Securities at 303-894-2810.

Milner is accused of soliciting investors to invest in several different fraudulent or non-existent business ventures, all allegedly involved in computer technology. He solicited investors by approaching individuals that he met through his work as a computer troubleshooter. Among the so-called businesses were Milhouse Systems, Inc.; Advanced Digital Security Systems, Inc.; Mobile Electronic Encryption Devices, Inc; and Gerald Milner LLC. Milner represented that these and other companies he promoted as investment opportunities were incorporated in Colorado. The Colorado Secretary of State’s office has no records of any such businesses ever having been incorporated in Colorado.

Milner promised investors shares of stock in these various ventures or provided investors with a note, receipt, agreement or contract to evidence their investment. To date, no investor has received any stock certificates, all promissory notes are past due and unpaid, and none of the investors have received any monies, principal or interest, from the defendant. Milner is also accused of making numerous untrue statements of material facts to induce investors to invest with him, and failing to disclose material information to the investors.

The defendant was arrested in Arapahoe County on November 15. Bond is set at $50,000. No trial date has yet been set.