Editor's note: This is the first in a two-day look at the ongoing problem of affinity fraud in Utah, and the push for solutions.

SALT LAKE CITY — Linda Garfield watched her boss' son grow up at Andrews & Co. on Main Street in Nephi, where she worked as a secretary for 32 years.

Because his mother was often sick, Tom Andrews spent a lot of time as a young boy at the office where his father, Earl, prepared tax returns for many people in the small Juab County town. Garfield often looked after the boy as his dad worked.

Linda Garfield, of Mona. | Scott G Winterton, Deseret News

"He considered me his mother," Garfield said seated on the couch in her home in Mona.

Andrews took over the business from his father, servicing his tax clients and also arranging investments for them and others.

Garfield, 69, and her husband Rex, 75, an AT&T microwave radio installer for 32 years, were among them. Andrews did their taxes and set up their only investment account using proceeds from the sale of the family farm in 2002.

And then he raided it — $273,000 gone. It was everything they had.

"He was just a like a bloodsucker," Rex Garfield said.

"You think you know people …," Linda Garfield added.

Though his own secretary said he had trouble adding and spelling, Andrews, 40, used his long-standing friendships and personable demeanor to steal $9 million from his clients, including doctors, lawyers, businessmen, mom and pop shop owners — even the former Nephi police chief — until he was caught last fall.

At Andrews' urging, the Garfields rolled their money into another company — as they had done several times on his advice to get a better return — this time Jackson National Life Insurance Co., a reputable firm that offers annuities.

Only when it came time for the transfer, the money wound up in the Garfields' account at Wells Fargo Bank.

Not to worry, Andrews told the couple. He went with Rex Garfield to the bank where he helped him get a check for $273,000 made out to Jackson Trust. Little did Garfield know that Jackson Trust was fake and only the name of an account Andrews opened at Cyprus Credit Union. The Garfields' money never went to the real Jackson company. It went straight to Andrews.

That scenario played out for at least two dozen people who did business with Andrews.

Andrews pleaded guilty to securities fraud and mail fraud in a deal with federal prosecutors who will recommend that he spend four to five years in prison. He is scheduled to be sentenced Nov. 3. His attorney, Greg Skordas, declined an interview request.

Fraud capital

This story isn't unusual in Utah. It happens all too often, fueling the state's reputation as the fraud capital of the United States. People will exploit their close personal relationships, whether it's in business or more likely through neighborhood or religious associations.

Though commonly called "affinity fraud" it's not really a type of fraud. It's more of a way for con artists to market their scams to people in their communities.

"It's out of whack," said Utah U.S. Attorney John Huber. "Utah is out of whack in the proportion of white-collar fraud that we have compared to other states. And that's recognized throughout the country."

Utah Attorney General Sean Reyes calls it "rampant." He has also used the word "epidemic" to describe what's happening in the state, and that is despite aggressive efforts to prosecute criminals and educate an unsuspecting public.

The Utah Securities Fraud Task Force — comprised of 10 federal, state and local agencies — calculated that 4,400 victims lost $1.4 billion to investment fraud in Utah based on the cases under investigation in 2010. It identified 370 potential perpetrators.

The agency hasn't updated those numbers, but FBI supervisory special agent Mike Pickett, who heads the white-collar unit in the Salt Lake field office, estimates the annual dollar amount now exceeds $2 billion.

"It's a scary huge number," he said.

The number of Utah victims today isn't easy to calculate, Pickett said. One current case alone involving Curtis DeYoung, who stole $24.9 million in retirement funds over 16 years, has more than 5,000 victims inside and outside the state. DeYoung, of Draper, pleaded guilty to mail fraud in September.

In 2010, the FBI ranked Salt Lake City fourth in the country among Ponzi scheme hot spots. Marquet International, a business investigation firm, placed Utah at No. 5 for what it called a "Ponzi propensity ratio" in 2011.

So far in 2016, federal criminal cases have totaled $59.3 million in losses, according to the U.S. Attorney's Office.

The state remains in the top five in terms of investigations, indictments, prosecutions and sentences, Pickett said. The Salt Lake FBI office, which includes Idaho and Montana, works about 75 cases a year.

But those two states don't have near the affinity fraud problem that Utah has, according to Pickett.

It's hard to pinpoint how Utah came into its ignominious distinction.

Keith Woodwell, Utah Division of Securities director, traces it back to the proliferation of penny stock fraud in the 1980s. Many broker-dealer firms involved in the scandal were based in Utah. Penny stocks are small, thinly traded companies generally traded "over the counter" rather than in markets such as the New York Stock Exchange.

Though the industry has largely gone away, the label it hung on the state has stuck.

The list of multimillion dollar scammers in Utah is long. Val Southwick, Shane Baldwin, Travis Wright, to name a few, swindled numerous people out of millions of hard-earned paychecks, life savings and retirement funds.

The three of them are in prison. But other scams are going on all the time.

"We think there are a whole bunch out there percolating," said Mark Pugsley, a Salt Lake attorney who represents white-collar crime victims.

The Mormon angle

Some of them prey on members of their own faith, typically The Church of Jesus Christ of Latter-day Saints, the predominant religion in Utah.

"Let's talk frank. The LDS community is what we're talking about. There's predators in sheep's clothing in our local congregations, and they will take advantage of their neighbors that trust them," said Huber, a former LDS stake president.

Southwick, for example, showed or mentioned his LDS Church temple recommend to potential investors. He decorated his office with what investigators described as Mormon "memorabilia" to breed a sense of trust. He had unwitting LDS missionaries come by his office when he was there with investors.

Kaysville insurance agent Dee Randall played on his LDS Church membership to win over investors in a $72 million Ponzi scheme. He used marketing materials explicitly designed to appeal to Mormons by focusing heavily on the biblical concept of the "abundant life," according to court documents.

What made the scam unique is that Randall told new investors up front that he planned to use their money to pay earlier investors and warned them not to put in money they couldn't afford to lose.

Woodwell said that disclosure doesn't make a Ponzi scheme legal. Randall, 65, recently pleaded guilty to four counts of securities fraud and one count of pattern of unlawful activity in state court. He is scheduled to be sentenced on the felony charges in February.

Most of Lori Ann Anderson's victims were members of her LDS Church stake in Logan. She formed a trading club named S.M.T.S. that allowed her to pool the money of friends who invested with her for day trading in Apple stock.

Anderson, 54, told her investors that she made returns of 10 percent a year and never had a losing day. Investors, according to the state securities division, were not chosen at random.

"Lori Ann had an uncanny way of drawing people quickly into her inner circle of friends," Dallas and LeAnn Holmes told a judge prior to Anderson's sentencing in May. Anderson invited the Holmeses and others to her LDS temple marriage "while solidifying their trust and belief in her integrity," according to a letter the couple wrote the judge.

Anderson, who spent time in prison in 1992 for defrauding insurance clients, admitted lying to investors, telling them she was making money when she was in fact losing it. She also admitted to showing investors false earnings on a software program she purchased for her computer.

Only about $40,000 of the $1.7 million she raised from more than 70 people remained when investigators questioned her in July 2015.

"Affinity fraud continues to be the most damaging white-collar crime where fraudsters not only steal the nest eggs of Utah victims but destroy their trusting nature as well,” Woodwell said after Anderson was sent to prison for up to 30 years.

Scammers, though, take much more than people's money.

Beyond lost cash

Rex and Linda Garfield fell into depression that required medication after learning of their losses. Their stomachs were upset. They constantly worried about how the would make their house payment and meet other expenses. The sold their travel trailer and four-wheeler. They don't go out much. Buying Christmas presents for their three grandchildren and three great-grandchildren is tough.

And then their daughter, Michelle Farley, unexpectedly died in February from a rare illness called acute respiratory distress syndrome, a condition that prevents enough oxygen from getting to the lungs and into the blood.

Her death and the inability to help their son-in-law with the medical bills further weighed on the Garfields. All Linda Garfield wanted to do was sleep.

"It's been a bad year," she said.

Another victim of Andrews, Suzanne Rengers, said she feels vulnerable and exposed, not to mention "kind of dumb" for being so trusting and not seeing some of the things that maybe she should have. It left her a little more skeptical, a little more cynical.

Frank Arnold Horton and his daughter, Suzanne Rengers. | Nick Wagner, Deseret News

"It definitely changed how I view people, how you trust people," she said. "You want to be trusting. You want to have that faith in people. It's hard when you see someone taking advantage of your father, your parents and other people, and yourself."

Like other victims, Rengers' father, Frank Horton, considered Andrews a good friend over the years that did his taxes. Andrews even once did Horton's son's taxes for free.

But what galls his daughter, who also lost money in the bogus Jackson Trust, is that Andrews took advantage of her father when he was most vulnerable.

Horton, a retired heavy equipment operator, and his wife, Kathleen, had their own IRAs, but no investment experience. Looking for safe investment for emergencies and death benefits, Horton went to Andrews. He counseled the Hortons to roll their IRAs into a Hartford annuity, which they did.

And then Kathleen Horton died in May 2015.

Horton again sought Andrews for tax advice. At that meeting, Andrews recommended Horton move his money to the fake Jackson Trust. He wrote a $43,000 check. Horton later received a phony statement showing $102,000 in the account. He now has no retirement savings.

"To me that was just despicable," said Rengers.

Horton said it hurts because he thought Andrews was such a good friend and "he turns around and hits you in the mouth like that." He also blames himself for getting his daughter involved with Andrews.

Rengers, who was diagnosed with multiple sclerosis in 2012, lost about $15,000 to the Jackson Trust. At age 54, she has had to start her retirement savings from scratch.

Sallie and Bill Rawlings

Always smiling and outgoing, Tom Andrews came across as Baby Huey, the big, naïve cartoon duckling. He seemed like a happy doofus. He hung his head and was always saying he was sorry for this or sorry for that. There was some "woe is me" in his mannerisms. He sought clients' advice for his personal life. He sat in their living rooms.

Turns out Linda Garfield wasn't the only person he considered his mother. He told the Rawlings they were like a mother and father to him. And that, Sallie Rawlings said, is how he reeled people in.

"Boy, did I read him wrong," she said.

Earl Andrews, before he went to prison, and later Tom Andrews did Bill and Sallie Rawlings' business and personal taxes for about two decades. Tom Andrews helped the Rawlings roll their IRA and 401K into a legitimate annuity. Later he told them they could get a better rate of return with Jackson National Life Insurance Co.

Tom Andrews gave them DVDs, brochures and quarterly statements that appeared to be from Jackson.

"There was nothing that made us feel that was not right," Sallie Rawlings said.

Last fall, the Rawlings didn't get a quarterly report from Jackson. Sallie Rawlings called the firm with her account number. After being on hold for a long time, the person on the other end said, "I hate to tell you this …"

Rawlings said she knew immediately what was coming next: Jackson didn’t have an account for the Rawlings.

"It's just like your heart goes to the bottom of our stomach, and the floor goes out from under you," she said.

They lost $675,000.

Only later did they learn the fake Jackson Trust materials were cut and pasted from the real Jackson company and mailed from a vacationing Andrews in California to lend them credibility.

Chad Bowles

Retired Nephi Police Chief Chad Bowles, 64, has known Earl and Tom Andrews his entire life. Earl Andrews did his taxes for years, and his daughter and Tom Andrews were friends growing up.

Former Nephi Police Chief Chad Bowles. | Scott G Winterton, Deseret News

Bowles actually put Earl Andrews, the father, in prison for forcible sexual abuse and lewdness with a child in 2005. He didn't see that as a reflection on Tom Andrews and even felt sorry for what he had to go through because of his father.

With the elder Andrews behind bars, Bowles turned to his son to take care of his taxes. He described Tom Andrews as a good kid who was never in trouble. He always had a smile on his face, liked to talk and even called Bowles for advice when he was going through a divorce. He was more Bowles' friend than his accountant.

Bowles put away a little retirement savings each month over his career. It totaled $170,000. He eventually turned it over to Tom Andrews, hoping to earn some interest. He had no way of knowing his money didn't go to a money management firm but straight to Andrews' credit union account.

When some paperwork didn't arrive as promised, Bowles called Andrews, who sounded nervous and didn't want to talk. Follow-up calls to the usually responsive Andrews suddenly went unanswered. Bowles turned to a law enforcement friend who told him Andrews was in big trouble.

"I knew I'd lost it then," the former chief said.

Andrews fooled everyone, he said. "There's a lot of people sitting back in awe thinking, 'How could he do that?'"

Bowles said it hurts, but he'll be all right.

"You hear about this stuff on the news and you think, 'Poor dumb buggers. How can they be so stupid?'" he said. "Then the next thing you know, you're the one that's stupid."

Steve Blaser

Steve Blaser, 72, built his fortune being a savvy investor, knowing when to buy and when to sell. He made money and he lost money over the course of his career. And he had it stolen from him.

The Bountiful man took an instant liking to the young man his son worked for at Silver Leaf Financial. Shane Baldwin was sharp, personable, clean-cut.

"A kid that you'd say, 'I'd really like my son to be like him,' just really dynamic, a go-getter, but he didn’t know the difference between a truth and a lie," Blaser said.

Baldwin bought and sold distressed properties that fell into default during the 2008 financial crisis. He promised investors big returns on the deals.

Blaser flew to Florida to check out a condominium complex. He had his title company do it due diligence. He invested. It paid off handsomely.

"Over a period of time, Shane just kept going to get bigger and bigger projects and just thought that he could never make a mistake because the early ones were hitting and making money," he said.

Blaser did more deals with Baldwin, some made money and some didn't. But then Blaser caught him in a lie on a North Salt Lake property. Baldwin tried to give him a forged document.

Blaser ended his business relationship with Baldwin then and there, but not before he lost "millions" of dollars. He won't say how much.

Baldwin wooed investors with numerous lies, including misrepresenting expected returns. He told one he was investing $2 million in an asset purchase but never did. He told others he had a buyer for an asset but none of the investors were repaid their initial investment. Baldwin used $1 million of investor money on personal expenses, including an airplane.

In all, he took investors for $14 million. He's now serving up to 60 years in prison.

Blaser said it's not losing money that makes him mad, it's the way he lost it.

"If Shane had stayed honest, he would have succeeded far beyond his wildest dreams. But he couldn't stay honest. He could not tell the truth. And the more that happened to him, the further he'd get away from recognizing the truth and what the truth was," Blaser said.

Coming tomorrow: How to protect yourself from the "silver-tongued devils" of affinity fraud.

Email: romboy@deseretnews.com

Twitter: dennisromboy; DNewsCrimeTeam