The federal government has suggested that a man and a woman are behind a Georgia bank scheme that fraudulently raised $15 million from unsuspecting investors.
The United States Securities and Exchange Commission (SEC) claimed that the apparent corruption has carried on since 2004 and extends past state lines now that both individuals live in other states. One of the accused parties, a man, lives in Florida. The other, a female, used to live in Georgia but has since relocated to California.
The SEC said that the so-called masterminds behind the venture promised investors they would reap the benefits of massive returns on their investments, which were being deposited in a European trust. The man said he was the U.S. director of the European trust while the woman served as the U.S. regional director. The authorities said that the two individuals are not who they say they are.
The man and woman said that investors could receive as much as 38 percent interest on their investment annually. However, investors could only make an investment if they kept their activity a secret.
The SEC reported that instead of using investor money to make the investments promised, the duo used the money to pay off other investors. Authorities also claimed that the man and woman did not divulge all the facts on how investments were being spent and did not highlight the risks involved with investing.
Via an emergency court order, SEC officials have attempted to freeze the duo's assets to avoid them from continuing the activity. Both are being charged with violating securities registration and antifraud provisions set in place by the SEC.
Any time investors do not get a promised return on their investments, they tend to cry foul play. It is very realistic that the investments were legitimate, but did not pan out in a volatile world economy.
Fraud charges are very serious and can garner severe punishment. It's important the SEC dig up hard evidence that shows foul play was involved before wrongfully convicting the man and woman.
Source: Atlanta Business Chronicle, "SEC charges two in Georgia prime bank scheme," Jacques Couret, Nov. 20, 2012