Man accused of using attorney to defraud bank

The FBI has arrested a Holladay man accused of using a local attorney's trust account to defraud a bank.

Federal prosecutors charged Shaun Gregory Morgan with bank fraud, alleging he enlisted an attorney to use his trust account at Zions Bank to purchase stock in a company with counterfeit cashier's checks. A federal complaint unsealed on Tuesday does not name the attorney.

"It was part of the scheme and artifice to defraud that the defendant enlisted an attorney by the name of S.S. to use his attorney trust account at Zions to accommodate the transfer of funds to the shareholders of Emerald Forest, Inc. for the purpose of purchasing 48 percent of the stock ownership interest in Emerald Forest, Inc.," the U.S. Attorney's Office for Utah wrote in the complaint.

"It was further part of the scheme and artifice to deposit counterfeit cashier's checks into the attorney trust account of S.S. to create the appearance of a balance sufficient to purchase stock at Emerald Forest, Inc."

The FBI alleges Morgan created a $535,000 cashier's check coming from a bank called "First Mutual" and deposited it in the attorney's Zions Bank account. The attorney met Morgan while shopping for office space for his new law practice; he'd just passed the Utah Bar exam. Morgan leased office space to S.S., who helped on a few legal transactions and the stock purchase.

The attorney then transferred the funds to a Provo law firm representing Emerald Forest. When the check came back, Zions Bank contacted the attorney and a second check was deposited into his account by Morgan, the FBI said. Both checks were counterfeit, with routing numbers from Washington Mutual Bank but with a non-existent account.

Zions Bankcorporation security personnel questioned Morgan about the purchase, the federal complaint said.

"Morgan admitted to using the fraudulent 'cashier's checks' as a 'bridge' to finance the stock purchase," FBI Special Agent Steve Whittle wrote in an affidavit filed with the complaint. "He stated money could be coming in to him, sufficient to cover the $535,000 check, but 'it didn't look good,' adding that 'it was a mistake,' referring to having deposited a bad check."

Morgan surrendered to the FBI on Tuesday and made his initial appearance before a federal magistrate. A detention hearing has been scheduled for this afternoon.

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E-mail: bwinslow@desnews.com