ST. GEORGE — A man accused of bouncing more than $500,000 in checks to two investors was arrested by a detective in Washington City — the same detective who investigated four similar cases filed against the defendant who left a wake of alleged losses in two other states.

Thomas Paul Madden, 65, was arrested Monday morning in Washington City and transported to Purgatory Correctional Facility facing five second-degree felony counts for issuing a bad check and failing to make good on the payment.

According to charging documents filed in 5th District Court, the arrest stems from an investigation into possible check fraud involving four checks deposited into a checking account at a local branch and later returned unpaid due to insufficient funds.

The report states that detectives in Washington City were contacted by a complainant who said she and a family member invested “a large sum of money” in the defendant’s businesses, and Madden indicated he was going to pay back a portion of their investment.

Over the next 13 months, starting in March 2021, Madden reportedly wrote five separate checks totaling $500,000 to the victims, but all were returned unpaid by the bank. Copies of these checks were turned over to investigators.

Detectives also obtained a warrant for Madden’s bank records, which revealed that at the time each check was written, Madden did not have the funds to cover the checks. This was further evidenced by the bank fees documented on his account when the checks were returned unpaid.

Madden has been under investigation by detectives in Washington City since the first case came to light in 2020. Investigators received a report involving checks that were drafted by Madden’s local bank branch that were returned unpaid for insufficient funds, according to court records.

In this case, Madden reportedly wrote three checks totaling more than $310,000 — all of which were honored by the local branch and bounced days later. By that time, less than half of the funds remained, leaving the bank with a loss of more than $145,200. The bank provided copies of all three checks that were allegedly signed by Madden.

During a phone call, the report states, Madden told investigators the checks were written to an individual who had threatened to do bodily harm to him and his family.

He also told investigators that while he knew he did not have enough money to cover the checks, he issued them as payment to “appease the other party,” who he said he believed to be responsible for the threats. Months later, the balances were “still outstanding,” which investigators said was an indication Madden made no effort to resolve the losses to the bank.

Madden was arrested June 10, 2022, and charged with three third-degree counts of issuing a bad check or draft.

Madden faced more charges in another case filed in March involving a check allegedly made out to one of his investors in Washington state.

According to charging documents filed at the time of the arrest, investigators received a report from the resident in Washington state who said she gave Madden approximately $200,000 for investment purposes the previous year. She also told authorities she has yet to see any type of return on her money.

When she spoke to Madden in December, he agreed to send her $26,000, the report states, and shortly thereafter, the bank notified her that a $25,000 check was received and on hold until they could verify the funds, which never happened. Instead, the check was returned due to nonsufficient funds. Madden was later arrested and held without bail until his release the following month.

In May, detectives submitted additional charges following a report from a victim stating that Madden owes them “over a million dollars” and they have been trying to get paid back. They had yet to receive any money since the $300,000 check Madden allegedly wrote him bounced.

Detectives spoke to Madden who said he had written a check to the victim in April and had sufficient funds in his account at the time. What he did not tell police, the detective noted, was that on that same date, Madden issued three checks to other investors totaling more than $450,000, even though his bank account had a balance of less than $300, the records revealed.

Following his arrest on Monday, he was booked into jail in Washington County facing five second-degree felony counts of issuing a bad check or draft.

Violation of in Washington State Security Act

Prior to relocating to Utah, Madden lived in Washington state, where he caught the attention of the Department of Financial Institutions Securities Division for reportedly violating the state’s Security Act, according to documents filed by the Washington State Security Administrator in 2016.

The report shows that from 1993-2010, Madden worked as a business consultant in four separate companies he owned that were incorporated in Washington state and elsewhere. He also illegally acted as a securities broker-dealer within the state, police said.

The defendant ran Madden Consulting, Inc., which was launched in 1993 to help businesses raise investment capital. In 1998, he started another business, Investor Relations International, Inc., and the following year he launched Madcon Company, Inc. which was also an investment capital consulting firm. These businesses are no longer in operation.

The Washington state filings also indicate that Madden earned more than $380,000 from selling securities to at least 16 investors there, primarily by selling stock to “members of his church, his acquaintances and friends of his acquaintances.”

In some instances, Madden reportedly sold his own stock to investors at triple the market price, and in another case, Madden sold stock to an investor based on claims the securities would sell for double or triple the price when in reality, the victim “lost the full value of his investment,” the state filings said.

According to investigators, at least two investors were 80 years old at the time they purchased stock from the defendant, while another investor “maxed out his home equity line of credit and took out a personal loan to help finance the purchase of stock from Thomas Madden,” the state filing noted.

At the time of the filings in Washington state, investigators found that all 16 investors had yet to receive a return on their investment.

The case was resolved this year when an order was signed Feb. 14, ordering Madden to pay $12,500 in fines and administrative costs, which was in addition to the $12,000 he had already paid in 2016 when the security violations were filed with the state.

He was also ordered to stop any further securities violations involving the use of fraud or deceit by the state of Washington.

$3.2 million in restitution owed in Arizona 

Madden also garnered the interest of the Arizona Corporation Commission in March 2018 when the agency issued a similar cease and desist order against him after the commission found he acquired more than $3.9 million in 169 stock transactions using misrepresentations or omissions during a five-year period starting in 2013, the security filings stated.

In one such instance, the commission found that Madden told at least one investor that a certain stock was a “bargain” and would soon increase in value, while telling another investor that the same stock would “soon” more than double in value, the commission noted in the order.

At the time these claims were made, the company that issued the stock had no revenue coming in from its business operations, other than a small amount of money the business earned during the single year it existed. Madden failed to disclose this when he sold the stock, according to the Arizona filings.

In another instance, Madden received $150,000 in loans from an Arizona resident who was also a client — $30,000 of which was paid back. The remainder, the commission report states, was left unpaid after two of the checks written to pay back the loans bounced.

According to the order signed March 13, 2019, the Arizona Corporation Commission ordered Madden to pay approximately $3.2 million in restitution to nearly 80 investors, in addition to $75,000 in administrative penalty costs.

5 cases in Utah

Since June of last year,  five cases have been filed in Utah that include a total of 16 charges, including 13 second-degree felony counts of issuing a bad check or draft, along with three third-degree felony counts of the same charge. The most recent case involved checks that were written to two of the investors in Washington state that were returned unpaid.

Madden was released from jail within hours of his arrest Monday and the case was filed the following day. An initial appearance on this case is scheduled for Sept. 8, while the four previous cases were scheduled for a resolution hearing that took place on Friday, the status of which has yet to be updated in the court record.

This report is based on statements from court records, police or other responders and may not contain the full scope of findings. Persons arrested or charged are presumed innocent until found guilty in a court of law or as otherwise decided by a trier-of-fact.

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