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 →