Donald M. Johnson claimed in court his annual income was $13,000 but after the state dug into the full list of properties he owns and the income they generate and contemplated placing those properties in receivership to sell them off, he dug a bit deeper into his pockets.
Johnson, 59, of Porter, pleaded guilty on Jan. 25 to a single Class C felony charge of a broker-dealer registration violation, a deal under which Johnson will serve four years on probation and must pay $604,500 in restitution to six of his victims, not just the one from the guilty plea.
Per a court order signed by Johnson, his most recent attorney and prosecutors on Thursday, he will pay $40,000 by Oct. 21 and begin paying $5,000 per month eight months later, starting on June 25, 2025.
Porter Superior Court Judge Jeffrey Clymer had ordered Johnson to pay $500 a month and, according to online court records, he has been doing so since March 28. As of Friday, he has paid $13,031.
Under the new payment plan, he should have restitution paid to his victims in just short of 10 years. He also received four years on probation as part of his sentence after Clymer reluctantly accepted Johnson’s plea agreement in January, a hearing during which prosecutors alleged Johnson was hiding assets from the court to avoid repaying his victims.
“I reluctantly — very reluctantly — accept the guilty plea,” Clymer said during the sentencing hearing.
Johnson’s actions spoke louder than his words, Clymer said then, and he didn’t place a lot of value on what Johnson said, including his apology to his victims.
“If you really were sorry, you would have done something since 2007 to pay them back. I don’t believe you’re sorry,” Clymer said in January. “You did everything you possibly could to delay the trial for nine years.”
The allegations against Johnson stretch back to around 2007 and include multiple victims who, according to charging documents, lost hundreds of thousands of dollars in real estate investments gone bad when they did not get the returns they were promised and couldn’t get back the money they put into the deals.
Gabriel Brown, a special prosecutor with the Indiana Securities Division, laid out quite a bit about Johnson’s finances during a May 30 court hearing. Johnson — and his family members — tried to file for bankruptcy multiple times; a federal bankruptcy judge barred Johnson and his mother from filing again for two years and five years, respectively, because they were so badly abusing the system.
Johnson transferred his properties to family members and different trusts and partnerships, all with business addresses that led back to his business address in the 300 block of North Broadway in downtown Chesterton, Brown said then. That also was the business address for the vacation rentals he owns.
All the businesses tracked back to the same bank account, too, also in Johnson’s name, Brown said. In March, one month after Clymer ordered Johnson to leave his accounts as they were and not dispose of them or any property, Brown has said Johnson switched his bank account.
Throughout various court hearings, as Clymer worked toward resolution in the yearslong case, the judge has often called Johnson a liar in open court.
During a July 19 hearing in the case, Clymer asked Johnson how much money he was holding from the rent he collects, and Johnson said $300. With a look of disbelief, Clymer immediately swore Johnson in.
“Tell me or you will go to jail now,” based on lying to the court, Clymer said then. “How many properties do you collect rent from? Your days of lying are almost done.”
Charges against Johnson were filed in March 2014 and he submitted a guilty plea in October 2023. The court learned from Brown during a January hearing that Johnson might be hiding assets, and during a February hearing, Johnson was ordered to pay $500 a month toward his victims, all he claimed he could afford at the time.
Johnson was initially charged with 14 counts related to securities fraud, Class C felonies at the time. Two months later he was charged with one count of forgery, also a Class C felony, and two counts of theft, Class D felonies, in a related case.
An appellate court ruling trimmed that to 15 counts after determining that the statute of limitations had run out for one of the victim’s claims but the rest of the charges could stand.
alavalley@chicagotribune.com
