Former Washington County DA sued over alleged fraudulent business scheme
A former Washington County district attorney is entangled in lawsuits by investors in an allegedly fraudulent business scheme, who claim his former clients induced some two dozen people to part with their savings.
The most recent case was filed in federal court Wednesday by Darren Burrow, a steel fabrication plant manager from Guernsey County, Ohio.
The suit contended Burrow gave Alternative Energy Holdings, a limited liability company, $100,000 from his retirement account in 2017. Similar to lawsuits filed recently by other investors, Burrow鈥檚 claims he was guaranteed fast and lucrative returns on his investments in AEH 鈥� which had addresses in Ohio and Florida 鈥� but has yet to see any of that money.
Attorneys for Burrow, one of at least 23 total investors in AEH who purportedly never got their money back or saw returns, accused AEH manager Jonathan Freeze of Geauga County, Ohio, and chief executive officer Kevin Carney of Robinson Township, Allegheny County of failing to follow through on provisions of a membership agreement.
The suit also names two Washington County lawyers 鈥� Steve Toprani, who was district attorney from 2008 to 2012, and his colleague Michael Hammond 鈥� who represented AEH鈥檚 officers for a time.
The filing accuses Toprani and Hammond of failing to disclose 鈥渞ed flags鈥� 鈥� including Freeze鈥檚 run-ins with the Financial Industry Regulatory Authority (FINRA), Carney鈥檚 2016 guilty plea to charges of grand theft and forgery in Ohio, and signs of fraud on the part of AEH 鈥� that 鈥渁 reasonable attorney in the same circumstances鈥� would have discovered.
The filing alleges that Burrow was supposed to get back his investment, plus $20,000, two months after he wrote a cashier鈥檚 check for $100,000. He allegedly handed over the money at the recommendation of Freeze, his longtime financial adviser.
鈥淧laintiff Burrow did not receive the payments promised in the AEH Note at the end of the (60-)day period,鈥� wrote his attorneys, 鈥渘or has he received any payments to date relating to his investment in the AEH Note, despite repeated requests to (Freeze).鈥�
The same month Burrow turned over most of his retirement savings, Freeze, who was a registered stockbroker for more than two decades, agreed to a permanent ban from the securities industry, the suit stated. He refused to cooperate with an investigation by FINRA, a body set up in an attempt by the securities industry to police itself.
Burrow鈥檚 suit alleged Carney and Freeze told him his investment would be 鈥渟eed money鈥� for operations to fund alternative energy plants. The filing also contended Burrow was told AEH had 鈥渇uel contracts 鈥榳orth millions of dollars鈥� with some of the world鈥檚 largest energy companies, including BP, and that he would be repaid from the 鈥榰p front鈥� payments by those companies.鈥�
Burrow鈥檚 lawyers, however, believe the contracts never existed and wrote that AEH is now classified by the state of Florida as being in 鈥渁dministrative dissolution.鈥�
When investors started asking about payments in 2017, the suit alleged Carney began providing periodic 鈥渦pdates鈥� to placate them. Meanwhile, Toprani and Hammond allegedly helped to assure clients that AEH was legitimate. Investors like Burrow now also accuse the lawyers of intimidating them by threatening legal action against investors.
Toprani, on Friday, said he believes the allegations made by Burrow and four others who have named him in similar suits are 鈥渕aterially false.鈥�
Asked about specifics of the allegations, Toprani said he had to be careful about confidentiality when discussing former clients. He said he was 鈥渘ot familiar with Mr. Freeze鈥檚 background.鈥�
As for Carney, Toprani said 鈥淚 really can鈥檛 speak to that relationship at this point, but I鈥檓 not familiar with him.鈥�
He said he hadn鈥檛 鈥渞epresented any of the parties鈥� in the lawsuits in 鈥減robably at least two or three years.鈥�
The suit also names Dodaro, Matta & Cambest, the firm where Toprani and Hammond were working, and DMC Bradley, a joint venture of DMC and another Canonsburg law firm, as defendants.
Toprani left DMC in the spring and became general counsel for W.G. Tomko. He said his departure was a matter of pursuing different opportunities and unrelated to events at issue in litigation.
The other suits that have been filed name the same defendants as Burrow鈥檚 does, plus Robert Irey, another manager of AEH and ex-husband of Washington County Commissioner Diana Irey Vaughn.
Those suits contend Irey and Freeze solicited neighbors to invest in their company when they lived in the same Canonsburg apartment building.
Irey didn鈥檛 return a message left at his company, the Irey Group. Valid phone numbers for Carney and Freeze couldn鈥檛 be located immediately Friday.
Joseph Luvara, the Pittsburgh attorney representing Toprani, Hammond, DMC and DMC Bradley, didn鈥檛 return a message Friday.