The founder of a failed private school in Aiken has been indicted, South Carolina Attorney General Alan Wilson said Friday.
An Aiken County grand jury returned four indictments against Jonathan “Jay” Warren Brooks. He was indicted on two counts of securities fraud – one alleging he took investments for a fictional entity called the Charles Howell Trust but instead converted the money for his personal use, and the second that he “improperly and without permission” diverted investment funds for the benefit of Compass Academy.
Brooks, who was arrested in July, also was indicted on a forgery charge, accused of forging the signature of an investor on a financial document. Additionally, he was indicted on a charge of violating the Securities Act by making false or misleading statements to the securities commissioner.
A former financial adviser, Brooks planned to open Compass Academy on a 30-acre lot at 1200 Toolebeck Road in August. The 53,000-square-foot building was placed under contract Oct. 24, two days before it was to be auctioned.
Earlier this year, Brooks was accused by state regulators of fraud and misuse of investors’ funds in financing the school. A restraining order filed in the 5th District of South Carolina Court of Common Pleas froze the accounts belonging to Brooks, J. Brooks Financial Inc., Brooks Real Estate Holdings and Compass Academy.
According to a civil complaint filed in April by the state attorney general’s office, Brooks and his wife, Tracy Brooks, used investor money to buy groceries, pay credit card bills and purchase luxuries, including a $21,000 diamond ring.
Columbia lawyer Sherri Lydon was appointed by the court as the receiver over Compass Academy and the assets of the Brookses.
Each felony count carries a sentence of up to 10 years in prison and possible fines.