A Gordonville man is charged with bilking over 50 local investors of over $700,000 by selling business shares that were not invested.
William H. Brown, 50, is charged on two criminal dockets with a combined eight felonies regarding a pizza shop franchise and a donut shop that was never opened.
Over fifty victims invested in the pizza business, Fox’s Pizza Dens of Lancaster County, LLC., with Brown selling them shares of Fox Pizza Den in Intercourse. Brown invested only a fraction of the victims’ payments into the business.
Brown, who was arrested Tuesday, was under a franchise agreement that did not authorize him to sell shares.
Among the charges filed against Brown are three felonies for violating the Pennsylvania Securities Act. These charges specifically relate to Brown selling the shares in the pizza franchise without informing investors he was not authorized to do so and failing to register the shares as required by law.
On a separate docket, Brown is charged with entering into an agreement with an Ephrata woman who invested $50,000 for a 49-percent share of a donut shop that was to be opened in the same building as the pizza shop in Intercourse.
Brown never opened the shop. He paid back the woman $1,000.
Brown, of Carriage Drive, was charged earlier this year for that incident and has waived a preliminary hearing on those two charges.
He was charged May 11 with the pizza franchise thefts.
District Judge Raymond Sheller arraigned Brown Tuesday morning on those counts and set bail at $1 million, which was not posted.
Lancaster County Detective James Zahm, lead investigator, filed charges with approval from Assistant District Attorney Kevin McGarry.
The pizza shop scam was so widespread Zahm held two community meetings in January to identify potential victims. Over fifty victims were identified, including 9 elderly victims. Brown targeted Amish and Mennonite investors, among others.
It should be noted that Brown is not involved in the ownership or operation of the Fox Pizza Den currently operating in Intercourse. The owners of that business have given law enforcement their full cooperation and are not accused of any wrongdoing.
Any individuals who had contact with Brown and believe they could be victims of criminal actions should contact their local police department or the Lancaster County District Attorney’s Office at 717-299-8100.
Brown is presumed innocent.
The investigation is ongoing.