MILTON (Florida) - AN INDIANA businessman whose financial management companies were under investigation apparently made a fake distress call, bailed out of his small plane and then let it crash in a Florida panhandle swamp.

Authorities searched Monday for Marcus Schrenker after he made the distress call and apparently secretly parachuted to safety near Birmingham, Ala. His single-engine plane continued flying on autopilot and eventually crashed late Sunday more than 322 kilometres away in a swampy area of the Florida Panhandle.

In the weeks before the crash, Mr Schrenker's life was spiraling downward: He lost a half-million-dollar judgment against one of his companies when he skipped a court hearing. His wife filed for divorce, and investigators probing his businesses for possible securities violations searched his home and office.

Authorities believe Mr Schrenker was last seen on Monday morning in Childersburg, Ala., just south of Birmingham, when a man using his Indiana driver's license told police that he'd been in a canoe accident. He was wet only from the knees down and had what appeared to be goggles made for flying.

The investigation into the crash began Sunday night, when Mr Schrenker's single-engine Piper Malibu crashed in a swampy area of north Florida.

The plane was en route from Anderson, Indiana, to the Florida Panhandle city of Destin when Mr Schrenker reported turbulence. He said the windshield had imploded and he was bleeding profusely, according to the sheriff's office in Santa Rosa County, where the plane crashed.

After he stopped responding to air traffic controllers, military jets tried to intercept the plane. They noticed the door was open and the cockpit was dark and continued to follow it until it crashed in a bayou surrounded by homes.

But when investigators found the plane, its door was ajar and the wreckage showed no signs of blood or the blown windshield. The sheriff's office said Mr Schrenker appeared to have intentionally abandoned his plane.

Bill and Debbie Timbie, whose house is less than 100 metres from where the plane crashed, were home on Sunday night when they heard the jets flying overhead. Bill Timbie gave rescuers looking for the downed plane a ride through the swamp in his canoe.

'Now, after you think about it, it could have been real bad, it could have taken out two or three houses,' he said on Monday.

The case grew stranger Monday morning, when the man with Schrenker's license told police in Childersburg - about 362 kilometres from where the plane crashed - that he'd been in a canoe accident with friends.

The officers, unaware of the plane crash, took him to a hotel. He was gone by the time they returned. They learned he had paid for his room in cash before putting on a black cap and running into the woods next to the hotel.

Authorities in Indiana have said little about the nature of the investigation into Schrenker's businesses - Heritage Wealth Management Inc., Heritage Insurance Services Inc. and Icon Wealth Management - wealth management companies that provide financial advice.

Mr Jim Gavin, a spokesman for Indiana's secretary of state, said investigators are looking at possible securities violations, and officers who searched Schrenker's home Dec 31 were looking for laptops, computers, notes, photos and other documents related to those companies.

Court records show his wife, Michelle, filed for divorce a day before the searches.

Mr Gavin said the Indiana Securities Division obtained a temporary restraining order on Monday freezing the personal assets of Marcus Schrenker and Michelle Schrenker and the assets of the three companies.

On Friday, two days before the crash, a federal judge in Maryland issued a US$533,500 (S$794,744) judgment against Heritage Wealth Management Inc., and in favor of OM Financial Life Insurance Co. The OM lawsuit contended that Heritage Wealth Management should have returned more than US$230,000 in commissions because there were problems with insurance or annuity plans Heritage had sold.

Mr Schrenker is an accomplished pilot with a background in aerobatics, said Mr Ron Smith, an interim manager at Anderson Municipal Airport. He usually flies out of the airport about once a week, making regular trips to Florida, he said.

'He's an outstanding pilot, from what I understand,' Mr Smith said. 'If he can fly aerobatics and a Meridian, you've got to be pretty decent.'

Those skills made Tom Britt, who edits a newsletter for the affluent Indianapolis suburb in which Mr Schrenker lives, suspicious of the circumstances surrounding the crash when he heard about it from a local reporter. Britt knew about the securities investigation.

'I said, 'Do they have his body? Call the police and tell them to pull the teeth out of it, because if there's a body in that plane, I guarantee that's not Marc Schrenker,'' Mr Britt said.

Residents jokingly call the community where Mr Schrenker lives, which overlooks a reservoir, 'Cocktail Cove' because the boaters plying its waters often have a mixed drink in hand.

The serene setting belies what Mr Britt described as a sometimes tense relationship between Mr Schrenker and his neighors. He said Mr Schrenker has two sides - one very cordial and generous, the other threatening and litigious - and that many in the neighborhood had run-ins with him and 'didn't care too much for him.' -- AP