Articles Posted in SEC News

The Securities and Exchange Commission (SEC) has filed a Complaint against Jaswant “Jason” Gill and Javier Rios, both California residents, and their company, JSG Capital Investments, with operating a classic Ponzi scheme aimed at middle-class investors with promises of exclusive investment opportunities and guaranteed annual returns of up to 60%, according to the SEC’s press release.

The SEC alleges that Mr. Gill and Mr. Rios, through their company JSG Capital Investments, raised approximately $10 million by catering to average retail investors and promising exorbitant returns by investing in hot pre-IPO stocks of well-known companies like Uber and Airbnb.  According to the SEC Complaint, Mr. Gill and Mr. Rios used most of the investors’ funds to pay returns to earlier investors, in classic Ponzi scheme fashion.  Further, the Complaint alleges that Mr. Gill and Mr. Rios personally pocketed at least $2.8 million of investors’ funds for their personal use, including excursions to Las Vegas casinos, gentlemen’s clubs, and professional sporting events. Continue Reading

The Securities and Exchange Commission (SEC) has filed a Complaint against Bobby M. Collins, a Wichita Falls, Texas resident. The SEC Complaint alleges that Mr. Collins raised nearly $4.6 million from at least 36 investors, most of whom were over the age of 65, to invest in what was a classic Ponzi scheme orchestrated through his unincorporated retirement planning business, Collins Insurance Companies a/k/a BMC Retirement Planning.

The SEC alleges that Bobby Collins lured investors across Texas and Oklahoma by offering high-yield, unsecured promissory notes promising returns typically of 25% over a 12, 18, or 24-month term. Mr. Collins also allegedly enlisted the assistance of an Oklahoma stockbroker to find additional investors, providing hundreds of thousands of dollars in additional investor funds in exchange for over $100,000 in referral fees. Continue Reading

The Securities and Exchange Commission (SEC) filed suit against Adam S. Gottbetter, a current Boca Raton, FL resident. The SEC alleged that Mr. Gottbetter used his New York office for the planning and implementing of a market manipulation scheme. Two Canadian stock promoters were also charged for assisting Mr. Gottbetter.

The SEC alleged that this case involves three market manipulations schemes to increase the stock price of three different publicly traded securities. It further alleged that Mr. Gottbetter played the role of architect and facilitator, using his law office as headquarters to plan the schemes. The SEC alleged that Mr. Gottbetter and the Defendants planned to pump the company’s stock prices and then sell the shares they controlled, reaping huge profits. Continue Reading

The Securities and Exchange Commission (SEC) filed suit against Michael J. Fefferman, a Senior Director of Information Technology for Ardea Biosciences, Inc. (Ardea). The SEC alleged that Mr. Fefferman leaked non-public information regarding pharmaceutical trials to his brother-in-law, Chad Wiegand, who passed the inside tip to another stockbroker. Between April 2009 and April 2012, Mr. Fefferman allegedly tipped Mr. Wiegand about four separate announcements beforehand that were likely to have a positive impact on Ardea stock prices. The SEC alleged that the Defendants received $550,000 in illegal profits from this insider trading scheme.

The first announcement concerned a global agreement with Bayer Healthcare, LLC related to the licensing of an Ardea developmental cancer treatment. The second announcement related to the initial testing of a promising drug for the treatment of gout. The third announcement provided positive news about the second phase of testing for the experimental gout treatment. Finally, the fourth announcement published news of the sale of Ardea to AstraZeneca. The price of Ardea stock increased with each announcement and the Defendants allegedly profited illegally from trading of Ardea stock with the non-public information. Continue Reading

The Securities and Exchange Commission (SEC) filed suit against Anthony Andrade of Rehoboth, Massachusetts alleging that he illegally tipped inside information to three friends and business associates about Bancorp Rhode Island’s (Bancorp RI) potential acquisition. The SEC alleged that the three friends traded based upon the information Mr. Andrade provided for them and profited when Bancorp RI’s stock price increased.

The SEC alleged that Mr. Andrade breached his fiduciary duty by providing material that was not public information to his friends and business associates. All of the people he provided this information to knew that he was a member of Bancorp RI’s board of directors and that Mr. Andrade had no business purpose for providing them with this information. Continue Reading

The Securities and Exchange Commission (SEC) has filed suit and obtained Final Judgement against The Spangler Group, Inc. (“Spangler Group”) and Mark Spangler, a Seattle, Washington investment adviser who allegedly defrauded clients by secretly investing them in Mr. Spangler’s risky start-up companies. Mr. Spangler also allegedly used client money for his own benefit even though the investments were inconsistent with the investment strategies he had promised his clients and contrary to his clients’ stated investment objectives.

According to the SEC Mr. Spangler and the Spangler Group raised over $56 million for several private funds that Mr. Spangler created and owned. The SEC claims Mr. Spangler advised that the funds would invest in publicly traded securities, but instead he liquidated the private funds positions, and funneled the proceeds primarily to two private companies for which Mr. Spangler served as Chairman and, at times, Chief Executive Officer. Continue Reading

The Securities and Exchange Commission (SEC) has filed a suit against Patrick Churchville, and his firm ClearPath Wealth Management (“ClearPath Wealth”) misappropriated and misused his investors’ cash and assets through a fraudulent scheme involving theft that was covered up by false accounting entries, shadow accounts, and misrepresentations to his investors, financial institutions, to third-party administrators, and to ClearPath Wealth’s auditors and accountants.

According to the SEC, Mr. Churchville and his firm, ClearPath Wealth, caused over $11 million in losses to investors of the funds they advised and controlled. The SEC alleged that the defendants misallocated and misappropriated investor assets as part of a Ponzi-like scheme. According to the SEC, the defendants took monies that were due to be distributed to particular investors to pay for new investments to fund distributions to unrelated investors and themselves. The SEC alleged that Mr. Churchville’s home overlooking Narragansett Bay was bought with approximately $2.5 million stolen from investors. Continue Reading

The Securities and Exchange Commission (SEC) recently filed a complaint alleging that during the period of March 2012 through February 2013, Edmond L. Lonergan and the Green Planet Group, Inc. (Green Planet) engaged in a fraudulent market manipulation scheme. According to the SEC, this scheme involved illegal bribes to a corrupt promoter and his buying group to purchase shares of Green Planet in the open market. However, the corrupt promoter working for Mr. Lonergan was actually an informant cooperating with the Federal Bureau of Investigation (FBI). The SEC alleged that Mr. Lonergan engaged in this scheme in an effort to generate the appearance of market interest, induce public purchases of the company’s stock, artificially increase volume in Green Planet stock and increase the stock’s trading price to sell his own Green Planet stock.

The SEC alleged that Mr. Lonergan and the FBI informant first agreed to engage in a fraudulent Green Planet stock market manipulation on March 30, 2012. Mr. Lonergan allegedly told the informant that he wanted him to cause two to three million shares of buying and increase the stock price from a half a cent to maybe two or three cents. Mr. Lonergan allegedly promised the FBI informant 1 share of stock for every 3 to 5 shares of purchases his group generated in the market place. The SEC further alleged that Mr. Lonergan agreed to arrange for Green Planet to issue timed press releases and provide advance copies to the witness of “front run news” before Green Planet actually issued the releases to the public. Mr. Lonergan then removed the restrictive legend on two stock certificates totaling 1 million restricted shares of Green Planet to allow the shares to be sold in the market place as payment for the informant’s role in the scheme. As part of the sting, the FBI purchased a total of 125,600 shares of Green Planet stock. Continue Reading

According to the U.S. Securities and Exchange Commission (SEC), from February 2012 through January 2014, Christopher A. Novinger and Brady J. Speers, and their company NFS Group, LLC d/b/a Novers Financial (collectively the “Defendants”) fraudulently offered and sold life settlement interests. In so doing, the SEC claims that Mr. Novinger and Mr. Speers made false and misleading representations to prospective investors about their purported business experience and financial expertise and that the Defendants misrepresented the investments.

The SEC alleged that Mr. Novinger and Mr. Speers also constructed fake, meaningless titles for themselves to make investors believe that they were experienced and sophisticated financial advisers. The SEC alleged that Mr. Novinger and Mr. Speers used terms such as “licensed financial consultant,” “licensed consultant,” and “licensed financial strategist” toward that end. In truth, they had no training relating to securities and non-insurance related financial products, including life settlements. The SEC also alleged that the Defendants told investors that the life settlement investments were “safe,” “risk free,” “safe as CDs,” “the most secure, safe method for growing funds,” “federally insured,” and finally comprised of “polices insured with large, A-rated companies and backed by Federal Reserves.” Continue Reading

According to a recent suit filed by the U.S. Securities and Exchange Commission (SEC), Thomas G. Ellis and Yasuo Oda, through their company, North Star Finance LLC, Thomas H. Vetter, and Michael K. Martin and Sharon L. Salinas, through their companies, Capital Source Lending LLC and Capital Source Funding LLC (collectively the “Defendants”) allegedly engaged in a “prime bank” fraud scheme. These schemes generally involve the purported trading and or use of financial instruments affiliated with international banking institutions or other sources.

In this case, the Defendants allegedly lured investors into complicated transactions involving bank guarantees and other financial instruments that would supposedly generate millions of dollars in profits for them. The SEC alleged that North Star and Capital Source collected approximately $5 million from defrauded investors and that the Defendants used the investors’ money for their own personal benefit. The SEC claims the investment programs were fictitious and the Defendants never obtained or “monetized” international bank investments to secure funding as guaranteed. Continue Reading