SARASOTA -- Dr. Wayne Cohen and his wife invested $462,000 with Daniel Prewett, so the Cohens had reason to be alarmed when they heard Prewett had been arrested on a federal money laundering charge.

The couple had given Prewett the money to buy real estate with his company, JH Investment Services Inc. After the arrest, the Cohens did some checking and found Prewett had transferred one of the deeds to himself without paying for it just a few months earlier, court records show.

The couple immediately asked for their money back. Then they had an attorney send a letter, and they say Prewett still hasn't responded.

Now the Cohens are in the same position as several other local people who gave Prewett money to invest in residential real estate: They have no idea what became of their investment, or how much of it was used to purchase the condominiums they thought they were buying.

The Cohens and two other couples have filed lawsuits against Prewett demanding an accounting of their combined investments of more than $1.1 million. Attorneys say more lawsuits are on the way.

Prewett, who made $1 million bail in federal court, has tried to soothe some investors with a letter that says the charges against him are baseless.

But his legal response has been to try to dismiss the lawsuits, saying the "joint venture agreements" the investors signed require any disputes to be settled in private arbitration, not the court system.

The agreements illustrate how Prewett, a felon who did time in a New York prison for a tax-fraud scheme, sold shares of real estate purchases in Sarasota, Costa Rica, North Carolina and South Carolina during the booming real estate market of early 2005.

On some agreements, he listed the actual addresses of properties to be purchased; on others he only listed "projects" the funds would go for, and he promised returns on the investments of up to 164 percent.

The Cohens' agreement states that at least four Blackburn Harbor condominiums would be purchased and ultimately resold. Four condos were purchased under the name JH Investment Services.

But the Cohens point out that Prewett transferred ownership of one of those condos to himself personally in August at no cost.

A lawsuit filed by another couple, Jason and Susan Collins, claims they invested $84,000 with Prewett, who never responded to an Oct. 30 letter from their attorney demanding the accounting on the joint venture.

Dentist Frank Kaman and his wife filed a lawsuit saying Prewett breached the contracts he made with them and never responded to their requests for accounting on the investments.

Prewett declined to comment when reached at his office on Thursday. His attorney did not return a call for comment Friday.

County records show Prewett has been involved in dozens of local businesses, and he is listed as owner of Jackson Hewitt Tax Service offices at 2041 Bahia Vista St., 1079 N. Tamiami Trail in Nokomis, and 1922 Dr. Martin Luther King Jr. Way.

He has an office at the Jackson Hewitt Tax Service at 5777 S. Beneva Road. County records list the owner as his wife. Corporate officials from Jackson-Hewitt said Friday that the company's franchise in this area was sold to another owner last fall.

The county records show Prewett was also a partner in Krome and Escapes, two Sarasota nightclubs, according to federal court records.

He was arrested in October.

Federal agents say in court records that they recorded Prewett discussing with undercover DEA agents on Aug. 1 the different ways he could launder money from a drug sale and transfer it to a bank account at his main office on Beneva Road.

In the next two months, an undercover DEA agent delivered $100,000 of supposed drug money to Prewett two times with the informants, and both times Prewett wired $90,000 to an undercover DEA account from an account belonging to JH Investment Services Inc., the records show.

To make bail, Prewett pledged four pieces of property, all of which were originally purchased by his company, JH Investment Services.

Prewett transferred three of those properties to himself for free in June, and took out $2.4 million in mortgages on them in the following weeks, county records show.

In the days after his release, Prewett wrote a letter to his investors telling them "all our investments are in secure, valuable real estate."

"It's true! I was unjustly arrested and tortured for two days until I had an opportunity to see a federal judge who felt I was worthy of release and should not be there!" Prewett wrote.

One man says he went to Prewett and got his $115,000 investment back. Solomon Shenker also said his sister got about $5,000 back of her $20,000 investment, with a promise from Prewett he would pay her back in full.

"He told me he had $40 million in assets. Everybody's going to get theirs; it's just going to take some time," Shenker said. "He's selling stuff off in North Carolina and everything."

Another Sarasota man has filed a claim of lien against three of Prewett's properties for $90,000, and the condo association where Prewett bought numerous properties says he hasn't paid more than $10,000 in assessments.

PREWETT GIVES HIS SIDE OF THE STORY

Businessman Daniel Prewett sent this letter to some of his investors after he made bail in a federal money laundering case.

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NEWS ALERT!

From the Desk (cell) of Dan Prewett, alleged "King Pin"

Dear Partners:

It's true! I was unjustly arrested and tortured for two days until I had an opportunity to see a Federal Judge who felt I was worthy of release and should not be there! I was then bashed in the papers, saw facts distorted, called a drug "King Pin" and generally made out to be a bad guy! Now eight pounds lighter and a little grayer I can get back to work. And you think you had a tough week!

Fortunately, none of it is true, I can't claim the title of "King Pin" or next weeks title of "God Father" of Sarasota (don't have the right ring). I must admit, I am half Italian, however, any alleged links to the Gotti or the Al Capone crime families are purely coincidental and go back to Adam and Eve and was beyond my control, really.

Those that know me realize I am just a hard working stiff, who is chained to a desk and should not be chained to a rock. The story will be amazing when it comes out. The mini series will be a hit, and the false arrest lawsuit should allow for early retirement. I personally wanted to inform you that all our investments are in secure, valuable real estate. None of our property assets were seized or frozen, and it is business as usual, or now, possibly unusual! This unfortunate incident did delay the enclosed property updates.

I also wanted to thank all of you who called to give me your support! We logged in over 300 support calls with only ONE disgruntled client out of the bunch. Your humorous defense suggestions were sincerely appreciated. Comments like "I know you don't do drugs, or you wouldn't be forty pounds overweight and constantly dozing off during meetings!" or "hey, you loaned good money, go back dirty money, that's 'de-laundering' it suppose to work the other way" were all very much appreciated. Humor (and a good lawyer) are the best medicine.

Again, thank you for your support and understanding in these trying times and difficult markets. Your support calls have enabled me to weather this terrible storm.

Warmest personal regards to all of you, and God Bless.

Daniel L. Prewett, Ph.D.
Former King Pin for a Day

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