RALEIGH — Two men from eastern North Carolina are under arrest for an alleged financial fraud scheme that involved victims in five counties, including Bertie and Hertford.

North Carolina Insurance Commissioner Wayne Goodwin announced Thursday the arrests of Milton Scott Hooks, 67, of 213 Westview Park Drive, Rocky Mount, and James Lester Mangum, 64, of 2005 Glissom St., Tarboro.

Hooks was charged with 33 counts of obtaining property by false pretense, 19 counts of conspiracy to commit obtaining property by false pretense, 33 counts of common law forgery, and 19 counts of conspiracy to commit common law forgery. The charges have been filed in Beaufort, Bertie, Hertford, Martin and Washington counties.

Mangum was charged with 19 counts of obtaining property by false pretense, 19 counts of conspiracy to commit obtaining property by false pretense, 19 counts of common law forgery, and 19 counts of conspiracy to commit common law forgery. The charges have been filed in Beaufort, Bertie, Hertford, Martin and Washington counties.

Department of Insurance criminal investigators allege that from May 2006 to August 2008, Hooks and Mangum criminally conspired to defraud American Equity Insurance Company and North American Insurance Company of more than $235,000 in commission payments.

Hooks and Mangum are accused of moving clients’ assets into annuity products offered by the two insurance companies without the clients’ knowledge, in order to receive commission payments. The alleged scheme involved 22 individual consumers from the aforementioned counties, and $2.5 million in assets, including 401-k investments, savings and certificates of deposit.

The alleged scheme involved forgery and alteration of documents and was not uncovered until clients attempted to withdraw money from their financial accounts.

The Department of Insurance, American Equity Insurance Company and North American Insurance Company worked together to ensure the consumers involved did not experience a financial loss as a result of the alleged actions of Hooks and Mangum.

Mangum was arrested on March 6 in Tarboro and placed under a $110,000 secured bond. Hooks was arrested on March 7 in Rocky Mount and placed under a $190,000 secured bond.

The Department of Insurance employs 20 sworn state law enforcement officers dedicated to investigating and prosecuting claims of insurance and bail bonding fraud.

Since Commissioner Goodwin took office in 2009, criminal investigators have received more than 13,500 complaints, resulting in 575 arrests, 320 criminal convictions and more than 100 pending court cases. These efforts have delivered more than $47.9 million in restitution and recoveries for victims.

An estimated 10 cents of every dollar paid in premiums goes toward the payment of fraudulent claims. To report suspected fraud, contact the Department of Insurance Criminal Investigations Division at 919-807-6840. Callers may remain anonymous. Information is also available at www.ncdoi.com.