NC SOS

On October 9, 2024, the North Carolina Department of the Secretary of State, Securities Division entered a Temporary Order to Summarily Suspend Registration Pending Final Determination to Revoke Registration of Peyton Whisnant for failing to report a felony charge and being convicted of a felony which are violations of the North Carolina Investment Advisers Act. For more information, click here.

On May 15, 2024, the North Carolina Department of the Secretary of State, Securities Division entered a Final Order to Revoke Registration as a Salesman and Registration as an Investment Adviser Representative against Joscelyn George Cockburn, II for violations of the North Carolina Securities Act and the North Carolina Investment Advisers Act. See entry at March 15, 2024, below for the Temporary Order. For more information, click here.

On May 8, 2024, the North Carolina Secretary of State, Securities Division, secured $125,000 in restitution for two North Carolina investors against Darryl Dwayne York, an Onslow County resident. York plead guilty in Carteret County Superior Court to three (3) Class H Securities Fraud Violations. York is also enjoined from engaging in or continuing any conduct or practice involving any aspect of the securities business. York fraudulently told investors their money would be invested in commodities or would be used as collateral for other investments, would not be at risk, and would generate returns up to 100%. York furthered the scheme by telling investors their investments were doing well and making profits. Instead, Mr. York was using investor money to repay other investors and for his own use and benefit.

On March 19, 2024, the North Carolina Secretary of State, Securities Division, entered into a Final Order ("Order") with Nexus Capital Inc ("Nexus") to address a books and records violation and failure to supervise. As part of the Order, Nexus agreed to immediately cease and desist from violating any provisions of the North Carolina Investment Advisers Act ("Act") and any administrative rules promulgated under the Act. For more information, click here.

On March 15, 2024, the North Carolina Department of the Secretary of State, Securities Division entered a Temporary Order to Summarily Suspend Registrations Pending Final Determination to Revoke Registrations of Joscelyn George Cockburn, II for violations of the North Carolina Securities Act and the North Carolina Investment Advisers Act. See the entry at May 15, 2024, above for the Final Order. For more information, click here.

On February 22, 2024, two Charlotte-area business partners were sentenced to prison for executing a fraudulent investment scheme, announced Dena J. King, U.S. Attorney for the Western District of North Carolina. Marlin Hershey, 54, of Cornelius, N.C., was sentenced to 21 months in prison followed by two years of supervised release. Dana Bradley, 53, also of Cornelius, was sentenced to 10 months plus one day in prison followed by two years of supervised release. In addition, the court imposed significant restitution and financial penalties on the defendants, including more than $333,000 in restitution to victims and combined forfeiture and fines of more than $600,000. North Carolina Secretary of State Elaine F. Marshall and Robert M. DeWitt, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, join U.S. Attorney King in making the announcement. See press release for more details. See also the entry at April 22, 2022, for additional details.

On February 7, 2024, the North Carolina Department of the Secretary of State, Securities Division, entered into a Final Order ("Order") with TradeStation Crypto, Inc ("TCI") to address TCI's failure to register its crypto interest-earning program as a security. As part of the Order, TCI agrees to immediately cease and desist from offering, selling or renewing the interest feature or any security that is not registered, qualified, or exempt to investors in North Carolina. For more information, click here.

On October 31, 2023, the North Carolina Department of the Secretary of State, Securities Division entered a Summary Order to Bar, Restrict or Limit (“Order”) Safeguard Metals LLC and Jeffrey Ikahn (a/k/a Jeffrey S. Santulan and Jeff Hill)> for acts or practices constituting violations of the North Carolina Securities Act, Investment Advisers Act and the Commodities Act. For more information, click here.

On October 23, 2023, the North Carolina Department of the Secretary of State, Securities Division entered into a Final Order ("Order") with True Bullion, LLC d/b/a Gold Silver International Exchange, d/b/a GSI Exchange, and Anthony Allen Anderson (“GSI Exchange”). The Order states that GSI Exchange encouraged North Carolina citizens to buy precious metals, encouraged persons to liquidate securities holdings in order to buy precious metals and did not adequately disclose the risk associated with the purchases. At no time did the Respondents hold a securities registration with the State of North Carolina. Pursuant to the Order, GSI Exchange agreed to immediately cease and desist from violating any provision of the North Carolina Securities Act, the Investment Advisers Act and the Commodities Act and any related administrative rules. GSI Exchange also agreed to offer reimbursement to any eligible purchaser. For more information, click here.

On October 20, 2023, the North Carolina Department of the Secretary of State, Securities Division, along with 29 other state regulators and the CFTC, entered into a Consent Order of Permanent Injunction and Other Statutory and Equitable Relief Against Defendants (“Order”) with Safeguard Metals LLC and Jeffrey Ikahn (a/k/a Jeffrey S. Santulan and Jeff Hill). Safeguard and Ikahn made material misrepresentations or omissions in connection with the offer, purchase or sales of securities; provided unregistered investment advice; and employed a device, scheme or artifice to defraud or engaging in an act, practice, or course of business that operates or would operate as a fraud or deceit. As part of the Order, Safeguard and Ikahn agreed to a permanent injunction that enjoins them from violating several federal and state laws including laws that prohibit commodities fraud, securities and investment adviser fraud, and providing unlicensed investment advice. For more information, click here.

On April 27, 2022, the founders of a fake “hedge fund” appeared in court today and pleaded guilty to federal charges for orchestrating a $4 million Ponzi scheme, announced Dena J. King, U.S. Attorney for the Western District of North Carolina. Austin Delano Page, 26, of Grover, N.C., pleaded guilty to wire fraud, and Brandon Alexander Teague, 26, of Belmont, N.C., pleaded guilty to securities fraud. U.S. Magistrate Judge David C. Keesler accepted the defendants’ guilty pleas. North Carolina Secretary of State Elaine F. Marshall, Robert R. Wells, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service (USPIS), which oversees Charlotte, join U.S. Attorney King in making today’s announcement. According to filed plea documents and the plea hearings, from October 2020 to December 2021, Page and Teague engaged in an investment scheme that defrauded hundreds of investors, some of whom were at or near retirement age, of more than $4 million. Court documents show that the defendants falsely represented to victims that Page and Teague were running a hedge fund in Kings Mountain, N.C., D&T Investment Group (D&T), that invested in various securities, including stock of well-known companies like Apple. Contrary to representations made to victim investors, D&T was not a hedge fund and it did not hold any securities licenses or registrations. Also, Page and Teague were not licensed to sell securities and did not have a background associated with the sale of securities. In fact, prior to orchestrating the investment scheme the defendants sold campers. For more information, please see this press release.

On April 22, 2022, two Cornelius, North Carolina residents are facing federal charges in connection with a multi-million dollar investment scheme, announced Dena J. King, U.S. Attorney for the Western District of North Carolina. A federal grand jury returned a criminal indictment this week against Marlin Hershey and Dana Bradley, both 52, charging them with mail and wire fraud conspiracy, mail fraud, securities fraud, and money laundering conspiracy. The indictment was unsealed this morning following Hershey’s appearance in court. North Carolina Secretary of State Elaine F. Marshall and Robert R. Wells, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, join U.S. Attorney King in making today’s announcement. According to allegations contained in the indictment, from approximately 2009 to 2021, Hershey and Bradley induced dozens of victims to invest millions of dollars in unregistered securities offerings, promoted by the defendants through Performance Holdings and other entities controlled by the defendants and other individuals, including Performance Retire on Rentals, LLC, Distressed Lending Fund, LCC, Moteng Funding, LLC and Southeast Lot Acquisitions, LLC, among others. For more information, please see this press release. For sentencing details, please see the entry at February 22, 2024 above or this press release.

On February 8, 2022, a multi-year investigation led by law enforcement agents with the North Carolina Secretary of State’s Securities Division with the assistance of the US Postal Inspection Service ended with Forsyth County Superior Court Judge David Hall sentencing Russell Joseph Mutter to a minimum of 16 years, 3 months and a maximum of 22 years, 5 months in prison for a scam in which 12 victims – most of them elderly – lost over $3.3 million. Mutter was charged with 41 counts of Investment Adviser Fraud, Financial Exploitation of an Older Adult, and Obtaining Property by False Pretenses. Judge Hall consolidated those charges into three Class C felony counts for sentencing purposes. Investigators say Mutter defrauded 12 victims in Forsyth County and outside of North Carolina – many of them elderly – out of $3,339,047.23 between January of 2009 and December of 2017. Mutter removed funds from his clients’ accounts without their authorization, invested some of his clients’ funds in high risk securities without their knowledge, and misused client funds. When these speculative investments failed, Mutter sought to hide the losses by fabricating fraudulent account statements. (See Press Release). The Secretary of State’s Securities Division issued a temporary Cease and Desist Order on February 27, 2018 (see the information on that date or click here) prohibiting Mutter from operating RJM Financial, and issued a Final Order on April 17, 2018 (see the information on that date or click here) permanently revoking his license to act as an investment adviser in North Carolina.

On November 15, 2021, Joshua Matthew Houchins, 36, of Raleigh, NC, was sentenced to ten years in prison on charges of Wire Fraud, in violation of Title 18, United States Code, Section 1343, and Possession of a Firearm by a Felon, in violation of Title 18, United States Code, Section 922(g). The defendant was also ordered to serve three years of supervised release and to pay restitution to victims in the total amount of $1,771,382.25. According to court documents and arguments made in court today, Joshua Matthew Houchins, 36, owner of various Raleigh real estate development companies, carried out a Ponzi scheme upon numerous local real estate investors. Houchins also possessed a rifle and several rounds of ammunition after having been convicted of a felony. According to the superseding indictment, between 2014 and 2018, Houchins owned and operated Rossshire Development LLC, Greenstone Ventures LLC, and Modern South Development LLC, and used these entities to carry out a fraud upon his real estate development investors. Specifically, Houchins solicited investment monies by telling victims that their money would be “put to work” on a specific property, and further represented that the investments would be secured by deeds of trust filed with the county register of deeds. In fact, Houchins did not put all of the investor funds to work on the property on which the investor was solicited to invest, and instead, regularly used investor funds on other properties, or on personal expenses. Likewise, the investor promissory notes were not secured by a deed of trust as promised. In some instances, Houchins did not even own the property that was the subject of the investment, and, as such, could not truthfully grant a deed of trust to the investor. The indictment alleges that after Houchins diverted investor money away from the property on which the funds were supposed to be spent, Houchins failed to develop and sell the properties, as he represented he would. Houchins then defaulted on the notes by failing to pay investors their promised returns. The investors were unable to foreclose upon the investment properties because Houchins had not secured the promissory notes with a deed of trust filed, thereby resulting in losses to the investors. Houchins specifically pled guilty to Count Nine, which alleged one instance of the above-described fraud on January 6, 2017. As a part of the plea, Houchins agreed to make restitution to all victims for losses arising from the scheme and related schemes. G. Norman Acker, III, Acting U.S. Attorney for the Eastern District of North Carolina made the announcement. The Federal Bureau of Investigation and the North Carolina Secretary of State investigated the case. The Wake County Sheriff’s Office, Apex Police Department, and Sanford Police Department also provided assistance. Assistant U.S. Attorney William M. Gilmore served as the prosecutor. See this press release.

On July 29, 2021, the North Carolina Department of the Secretary of State, Securities Division entered into a Final Consent Order ("Order") with Tannin Capital, LLC. The Order states that Tannin Capital was ineligible for an exemption from state registration as an investment adviser from October 2019 through on or about April 2020. Pursuant to the Order, Tannin Capital agreed to immediately cease and desist from violating any provision of the North Carolina Investment Advisers Act and any related administrative rules, to pay a civil penalty and reimbursement of the costs of investigation. The North Carolina Department of the Secretary of State thanks the U.S. Securities and Exchange Commission, Atlanta Regional Office for their assistance in this matter. For more information on this Order, click here.

On May 21, 2021, the North Carolina Department of the Secretary of State, Securities Division entered into a Final Consent Order (“Order”) with Roy Neil Carlson. The Order states that Carlson violated North Carolina law during the last two years by transacting business in North Carolina as an investment adviser representative without a valid registration pursuant to the North Carolina Investment Advisers Act. Pursuant to the Order, Carlson agreed to immediately cease and desist from violating any provisions of the North Carolina Investment Advisers Act and any related administrative rules, to pay a civil penalty, and cost of investigation. For more information, click here.

On April 5, 2021, Anthony Wayne March, 49, of Wake Forest, NC, was sentenced to 135 months imprisonment for wire fraud and ordered to pay $6,040,965.00 in restitution. According to court documents, Anthony Wayne March, 49 years old, operated the non-profit 501(c)(3) entity Asset Trader, located in Rolesville, NC, between 2012 to 2015. March represented that Asset Trader offered educational services to professionals and taxpayers in the area of exit planning. Asset Trader’s stated educational mission allowed it to obtain classification as a 28 U.S.C. § 501(c)(3) tax-exempt non-profit organization. Asset Trader used its §501(c)(3) tax-exempt status to solicit tax-deductible donations in exchange for charitable gift annuities (“CGAs”) and to recruit referral sources to obtain assets from potential donors. Through Asset Trader, March and his co-conspirators engaged in and executed what is commonly known as a “Ponzi” scheme to defraud investors by inducing them to invest with Asset Trader. During the course of the scheme, March solicited at least 22 victims to invest over $8,100,000 in charitable gift annuities and other products offered by Asset Trader. March and Asset Trader sold these securities to victims as retirement or exit planning vehicles classified as donations to March’s § 501(c)(3) tax-exempt non-profit organization. March did not utilize any of the victim’s money for charitable purposes; rather, he spent the money on "Ponzi" payments, his own lavish lifestyle, and expenses of the scheme. G. Norman Acker, III, Acting U.S. Attorney for the Eastern District of North Carolina, made the announcement after sentencing by Chief U.S. District Judge Richard E. Myers II. The Internal Revenue Service Criminal Investigation Division (IRS-CI), and the North Carolina Secretary of State, Securities Division conducted the investigation in this matter. The Office of the U.S. Bankruptcy Administrator for the Eastern District of North Carolina provided substantial assistance. Assistant United States Attorney Ethan Ontjes, Special Assistant United States Attorney Brian Behr, and Special Assistant United States Attorney Kevin Harrington represent the United States. For more information, see this press release and the entry at August 3, 2020 below.

On March 26, 2021, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Cease and Desist Order to Respondents, Roy Neil Carlson and Carlson Financial Services, LLC. The order found Respondents were transacting business in the State of North Carolina in violation of the North Carolina Investment Advisers Act. The Temporary Order to Cease and Desist ordered each Respondent and any person, employee, officer, director, entity or independent contractor under the direction or control of Respondents, to immediately cease and desist from violating the anti-fraud provisions of the Investment Advisers Act, soliciting or providing investment advice to any prospective or current advisory clients, making or causing to be made any misleading filing to the Administrator and otherwise holding itself out to be or engaged in the business of an investment adviser or investment adviser representative. The Temporary Order to Cease and Desist gives Respondents 30 days in which to request a hearing. If no such request is made during that time, The Temporary Order to Cease and Desist shall become final. For more information, click here.

On March 15, 2021, Charles Gilbert Murphy, 64, a serial fraudster from Apex, NC, was sentenced to 75 months in federal prison and ordered to pay $909,763.28 in restitution owed to dozens of victims on charges of Wire Fraud and Aiding and Abetting and Aggravated Identity Theft. The case showed that defendant Charles Gilbert Murphy was subject to collection efforts by the United States Government arising from a prior federal conviction for Wire Fraud in June of 1999 in this same district. To avoid his payment obligations Murphy used his family members to open bank accounts for him in the name of various companies he controlled, referred to in the Indictment as the “Murphy Entities.” Murphy used the Murphy Entities to obtain money from individuals and entities under false and fraudulent pretenses. Murphy defrauded dozens of victims in this case. Many of the victims lost down payments they paid to Murphy, trusting that he would deliver on his promises. Unfortunately, others lost their life savings. At sentencing the Government sought and obtained an order of restitution on behalf of these victims, totaling $909,763.28. The investigation of this case was conducted by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation, and the North Carolina Department of the Secretary of State, Securities Division. Assistant United States Attorney William M. Gilmore represents the United States. For more information, see this press release.

On January 7, 2021, the Temporary Cease and Desist Order entered on November 9, 2020 against Claybourne Glenn Bass and Claybourne Glenn Bass, LLC (the "Bass Respondents") became final, permanently barring the Bass Respondents from among other things, soliciting for purchase, offering or selling securities in North Carolina until such time as they become fully compliant with North Carolina's securities laws. For more information, click here.

On November 9, 2020, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Cease and Desist Order to respondents, Claybourne Glenn Bass and Claybourne Glen Bass, LLC. The order found the respondents were transacting business in the State of North Carolina in violation of the North Carolina Securities Act. The Temporary Order to Cease and Desist ordered each respondent to immediately cease and desist from violating the anti-fraud provisions of the Securities Act; entering into investment contracts with the public; offering for sale, soliciting offers to purchase, or selling, any security and otherwise holding itself out to be or engaging in the business of securities dealer or salesman. The Temporary Order to Cease and Desist gives respondents 30 days in which to request a hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. For more information, click here.

On September 8, 2020, a federal grand jury returned a superseding indictment charging Joshua Matthew Houchins, 36, of Sanford, NC, with fraud, money laundering, obstruction of justice and firearms offenses. The charges were announced in federal court (see press release) today during an initial appearance. According to the first section of the superseding indictment, Houchins operated a number of real estate development companies in Raleigh between 2014 and 2018, including Rossshire Development LLC, Greenstone Ventures LLC, and Modern South Development LLC. The indictment charges that Houchins used these entities to carry out a fraud upon his real estate development investors. According to the second part of the superseding indictment, the grand jury began to investigate Houchins in 2018 concerning the aforementioned offenses. Following the issuance of subpoenas to his attorney and to his various real estate companies, Houchins only produced a small number of documents to the grand jury. Instead, the indictment alleges that Houchins admitted in a February 2020 letter that he had “destroyed all of the evidence.” The superseding indictment also alleges that Houchins, who had recently separated from his wife, began to send her harassing messages. The indictment alleges that Houchins’ wife obtained a Domestic Violence Protection Order (DVPO) barring Houchins from contacting, threatening or harassing his wife. While Houchins was already prohibited from possessing a firearm due to his status as a convicted felon, the DVPO further prohibited Houchins from possessing a firearm. The superseding indictment then alleges that in March of 2020, Houchins communicated to friends of his wife that she had “run to the police” and that Houchins has “no mercy on a lying rat.” Around one month later, the superseding indictment alleges that Houchins sent threatening communications to friends and family of his wife, including photographs of Houchins wearing a mask and tactical vest. The superseding indictment then charges that, following his internet searches for “killing your wife over love,” Houchins was arrested. At the time of his arrest, Houchins was in possession of a Ruger AR-15, 4 magazines, a double canister magazine containing 100 rounds of ammunition, two boxes of .223-caliber ammunition, and a tactical vest. Houchins is charged with nine counts of Wire Fraud, in violation of Title 18, United States Code, Section 1343, each of which carry a punishment of up to 20 years in prison. Houchins is charged with three counts of Conducting Monetary Transactions in Criminally Derived Property, in violation of Title 18, United States Code, Section 1957, each of which carry a punishment of up to 10 years in prison. Count 13 of the Superseding Indictment charges Obstruction of Justice, in violation of Title 18, United States Code, Section 1512(c)(1), which carries a maximum punishment of up to 20 years in prison. Lastly, Houchins is charged with Felon in Possession of a Firearm, and Possession of Firearm by Person Subject with a DVPO, in violation of Title 18, United States Code, Sections 922(g)(1) and (g)(8). Both of these offenses carry a maximum punishment of up to 10 years in prison. Robert J. Higdon, Jr., U.S. Attorney for the Eastern District of North Carolina made the announcement. The Federal Bureau of Investigation and the North Carolina Secretary of State are investigating the case. The Wake County Sheriff’s Office, Apex Police Department, and Sanford Police Department, also provided assistance. Assistant U.S. Attorney William M. Gilmore is prosecuting the case. An indictment is merely an accusation. The defendant is presumed innocent until proven guilty. For additional information, please see the entry at May 26, 2020, below.

On August 13, 2020, Mark Colin Ramsey, 50, of Graham, N.C., was sentenced to 65 months in prison for operating a $1.1 million investment scheme. U.S. District Judge Martin Reidinger also ordered Ramsey to serve three years of supervised release and to pay restitution in the amount of $1,098,333.92. North Carolina Secretary of State Elaine F. Marshall joins U.S. Attorney Andrew Murray in making this announcement. According to filed court documents and statements made in court, from April 2008 to September 2013, Ramsey defrauded more than 20 victims out of nearly $1.1 million through a fraudulent investment scheme. Court records show that Ramsey operated various purported investment companies, including Hypertrend, Cascade Investments, GH Gardner, Layton-McCall, Pandrox, and Good Living. Ramsey induced victim-investors by falsely representing that their money would be used to make legitimate investments. He also promised his victims that they would receive a guaranteed return on their investments, and that their principal investments would not be at risk. During the relevant time period, Ramsey used multiple purported investment corporations, as well as numerous fraudulent documents, including false Form-1099s, fake investment agreements, and fabricated stock certificates, to convince potential victims his investments were legitimate and profitable. To further induce victims, court records reflect that Ramsey showed potential investors documents purportedly backing up his claim that he had made one million dollars from a ten thousand dollar investment. According to court records, Ramsey failed to disclose to his victims, some of whom were at or near retirement age, that he was not registered to sell securities in the State of North Carolina, or that the investment opportunities he presented were not registered as required by statute. Rather than invest the victims’ money as promised, Ramsey spent the investors’ money on Ponzi-style payments to other investors and to fund his personal lifestyle. On August 26, 2019, Ramsey pleaded guilty to securities fraud. In making today’s announcement, U.S Attorney Murray thanked the Securities Division of the North Carolina Department of the Secretary of State for their investigation of this case. (Press Release.)

On August 3, 2020, Anthony Wayne March, of Wake Forest, NC, pleaded guilty to wire fraud for his role in an $8.1 million Ponzi scheme (see press release). According to court documents, March, 49 years old, operated the non-profit 501(c)(3) entity Asset Trader, located in Rolesville, NC, between 2012 to 2015. March represented that Asset Trader offered educational services to professionals and taxpayers in the area of exit planning. Asset Trader’s stated educational mission allowed it to obtain classification as a 28 U.S.C. § 501(c)(3) tax-exempt non-profit organization. Asset Trader used its §501(c)(3) tax-exempt status to solicit tax-deductible donations in exchange for charitable gift annuities (“CGAs”) and to recruit referral sources to obtain assets from potential donors. Through Asset Trader, March and his co-conspirators engaged in and executed what is commonly known as a “Ponzi” scheme to defraud investors by inducing them to invest with Asset Trader. The Internal Revenue Service Criminal Investigation Division (IRS-CI), and the North Carolina Secretary of State, Securities Division conducted the investigation in this matter. The Office of the U.S. Bankruptcy Administrator for the Eastern District of North Carolina provided substantial assistance. Assistant United States Attorney Ethan Ontjes, Special Assistant United States Attorney Brian Behr, and Special Assistant United States Attorney Kevin Harrington represent the United States. On April 5, 2021 (see entry), March was sentenced to 135 months for wire fraud (see press release). For additional information, see the entry at November 21, 2019 below.

On June 11, 2020, Joseph Maurice Deberry, a/k/a Joseph Maurice Dewberry, 56, of Charlotte, appeared before U.S. Magistrate Judge David S. Cayer on June 11, 2020, and pleaded guilty to wire fraud, for orchestrating an investment scheme that defrauded victims of hundreds of thousands of dollars, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. According to admissions Deberry made in plea documents and the June 11th plea hearing, from 2016 through June 2019, Deberry fraudulently obtained hundreds of thousands of dollars from more than a dozen investors. As part of the scheme, Deberry induced victims to invest in entities with which he was affiliated, such as Pinnacle Investment Properties, LLC and Place Capital Group LLC, among others. Deberry typically represented to investors that their money would be used to further projects related to the construction of student housing at certain colleges in the Carolinas and other ventures. As Deberry admitted in court and in related filings, rather than use the victims’ money as he had represented, Deberry used a significant portion of their funds to pay for personal expenses like rent, entertainment and travel. Further, Deberry actively concealed from his victims the fact that he was under a Cease and Desist Order from the North Carolina Secretary of State's Securities Division prohibiting him from offering for sale, soliciting offers to purchase, or selling any securities in North Carolina (see entry at March 6, 2012 below). Deberry concealed this information from victims by, among other things, telling them that his name was Maurice Dewberry. Deberry pleaded guilty to wire fraud. The charge carries a maximum prison sentence of 20 years and a $250,000 fine. A sentencing date for Deberry has not been set. For more information, see this press release.

On May 26, 2020, a federal grand jury indictment was unsealed revealing that an indictment had been returned against Joshua Matthew Houchins, 36, of Sanford, NC, charging him with nine counts of wire fraud and three counts of money laundering (see press release). According to the indictment, Houchins operated a number of real estate development companies in Raleigh between 2014 and 2018, including Rossshire Development LLC, Greenstone Ventures LLC, and Modern South Development LLC. The indictment charges that Houchins used these entities to carry out a fraud upon his real estate development investors. According to the indictment, Houchins solicited investment monies by telling victims that their money would be “put to work” on a specific property, and further represented that the investments would be secured by deeds of trust filed with the county register of deeds that was the subject of the investment. In fact, Houchins did not put all of the investor funds to work on the property on which the investor was solicited to invest, and instead, regularly used investor funds on other properties, or on personal expenses. Likewise, the investor promissory notes were not secured by a deed of trust as promised. In some instances, Houchins did not even own the property that was the subject of the investment, and as such, could not truthfully grant a deed of trust to the investor. The indictment alleges that after Houchins diverted investor money away from the property on which the funds were supposed to be spent, Houchins failed to develop and sell the properties, as he represented he would. Houchins then defaulted on the notes by failing to pay investors their promised returns. The investors were unable to foreclose upon the investment properties because Houchins had not secured the promissory notes with a deed of trust filed, thereby resulting in losses to the investors. Robert J. Higdon, Jr., U.S. Attorney for the Eastern District of North Carolina made the announcement. The Federal Bureau of Investigation and the North Carolina Secretary of State are investigating the case and Assistant U.S. Attorney William M. Gilmore is prosecuting the case. For additional information, please see the entry at September 8, 2020, above. An indictment is merely an accusation. The defendant is presumed innocent until proven guilty.

On April 16, 2020, the North Carolina Department of the Secretary of State, Securities Division entered into a Final Consent Order ("Order") with Ferry Capital Management, LLC ("FCM") and Paul Edward Ferry. The Order found that Respondents transacted business in North Carolina as an investment adviser and an investment adviser representative without being registered, in violation of the North Carolina Investment Advisers Act ("Act"). Pursuant to the Order, FCM and Ferry agreed to immediately cease and desist from violating any provisions of the Act and any related administrative rules; keep FCM's Form ADV updated; hire a third-party compliance auditor; attend the Securities Division's Investment Adviser Best Practices Workshop; and pay both a civil penalty and the cost of investigation. For more information, click here.

On February 26, 2020, Rozalia Ann Kramer, 51, was sentenced in US District Court in Winston-Salem, NC, to a total term of imprisonment of 24 months for wire fraud and money laundering. In addition to prison time, Kramer was ordered to serve three years of supervised release and to pay restitution in the amount of $90,000 and a special assessment of $100.00. A forfeiture money judgment in the amount of $102,000 was also imposed. Kramer pleaded guilty on October 8, 2019. Her case was jointly investigated by the US Postal Inspection Service’s White Collar Crimes Task Force and the North Carolina Department of the Secretary of State Securities Division. According to documents filed with the Court, Kramer met elderly World War II veteran J.V.M. while in line at the K&W Cafeteria at Friendly Center shopping center in Greensboro. After speaking in line with J.V.M., Kramer dined with him. She then began to socialize with the elderly widower regularly eating with him and meeting him on social occasions, J.V.M. owned a residence on Forest Hill Drive in Greensboro, free of any liens or mortgages. He had lived in the house since the 1950s and raised his family there. However, in 2015 J.V.M. began to reach the bottom of his retirement savings. He approached at least one bank and attempted to arrange a reverse mortgage. He then approached his friend Kramer who had told him that she was a wealthy real estate investor. Kramer represented that she could provide J.V.M. with a reverse mortgage and would provide him a life estate that would allow him to live in the Forest Hill Drive property for the rest of his life. J.V.M. agreed and gave Kramer a deed to the property. However, Kramer included the Forest Hill Drive property as part of a group of properties used to induce a loan from B2R Finance. J.V.M. was unaware that B2R Finance gained a first security interest in the Forest Hill Drive property. At the closing of the loan from B2R Finance, Kramer directed that $146,000 of the proceeds be wired to J.V.M.’s bank account representing the money to be from the purported reverse mortgage. Kramer provided J.V.M. with a life estate in the Forest Hill Drive property, but the life estate was subordinate to the first deed of trust. Kramer then induced J.V.M. to part with half of the proceeds of the purported “reverse mortgage.” She induced him to loan $75,000.00 to a corporation she controlled and gave J.V.M. a promissory note due in one year. These funds were converted to Kramer’s use and never repaid to the victim. Instead, Kramer moved to Colorado and broke off all contact with J.V.M. She made no payments to B2R Finance on the loan, and B2R foreclosed. J.V.M. continued to live in the Forest Hill Drive property secure in his belief that he had a life estate in the property. However, the life estate was extinguished when B2R Finance foreclosed, and J.V.M. was evicted. From Colorado, Kramer moved to Wyoming in an attempt to avoid victims of her frauds who were seeking repayment. She ultimately took a job working on an isolated hunting ranch 15 miles outside Wheatland, Wyoming. She lived in housing owned by the ranch and drove a vehicle registered under a corporate name. Despite these attempts to avoid justice, Postal Inspectors from Greensboro, North Carolina, and Laramie, Wyoming, located Kramer, and arrested her at the ranch. The victim died in 2019. At sentencing, his daughter testified that the eviction had a devastating impact on her father. Kramer was taken into custody at the conclusion of the sentencing hearing. For more information, please see the press release.

On February 18, 2020, the North Carolina Department of the Secretary of State, Securities Division entered into a Final Consent Order (“Order”) with Joseph M. Murtagh, Jr. and Joseph M. Murtagh, Jr. d/b/a The Source. The Order states that The Source and Murtagh violated North Carolina law during at least some of the years they transacted business in North Carolina as an investment adviser and an investment adviser representative without registering pursuant to the North Carolina Investment Advisers Act. Pursuant to the Order, The Source and Murtagh agreed to immediately cease and desist from violating any provisions of the North Carolina Investment Advisers Act or Securities Act and any related administrative rules, to pay a registration fee, to pay a civil penalty, and to pay a sum to the Investor Protection and Education Trust Fund. For more information, click here.

On December 10, 2019, the U.S. Attorney’s Office for the District of New Jersey announced the arrest of three men in connection with a cryptocurrency mining scheme that defrauded investors of $722 million. North Carolina Securities Division conducted an investigation into a fraudulent cryptocurrency mining scheme known as the BitClub Network. As a result of the multi-jurisdictional complexity of this scheme, the Division's investigation was coordinated with the United States Attorney's Office in New Jersey as well as the Internal Revenue Service Criminal Investigation Division (IRS-CI). According to the indictment, from April 2014 through December 2019, the defendants operated BitClub Network, a fraudulent scheme that solicited money from investors in exchange for shares of purported cryptocurrency mining pools and rewarded investors for recruiting new investors. For more information, please see the U.S. Attorney’s press release. On May 30, 2018, the Securities Division issued an investor alert regarding BitClub Network and its activities. For more information, click here.

On November 25, 2019, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Cease and Desist Order to respondents, Ferry Capital Management, LLC ("FCM") and Paul Ferry. The Temporary Cease and Desist order found the respondents were transacting business in the State of North Carolina as investment advisers and investment adviser representatives in violation of the North Carolina Investment Advisers Act. Additionally, respondents continued to hold themselves out as a registered investment adviser and investment adviser representative in violation of the anti-fraud provisions of the North Carolina Investment Advisers Act. The Temporary Order to Cease and Desist ordered each respondent to immediately cease and desist from a) transacting business in the State of North Carolina as investment advisers and investment adviser representative, b) representing as an investment adviser or investment adviser representative on the internet or any social media platform, c) making material misstatements and omissions of fact to advisory clients, d) making or causing to be made any misleading filings in any material respect. The Temporary Order to Cease and Desist gives respondents 30 days in which to request a hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. For more information, click here.

On November 21, 2019, United States Attorney Robert J. Higdon, Jr. announced that a federal grand jury had returned an Indictment charging ANTHONY WAYNE MARCH, 48, of Wake Forest, North Carolina, with one count of Securities Fraud; three counts of Wire Fraud; one count of Bankruptcy Fraud; one count of Obstruction of Bankruptcy Case; three counts of False Oaths; and four counts of Money Laundering. The indictment follows an investigation by the NC Secretary of State’s Securities Division and the IRS Criminal Investigation Division. He subsequently pleaded guilty on August 3, 2020 (see the entry above) to wire fraud for his role in the $8.1 million Ponzi scheme. For more information, please see this press release. For more information, click here.

On October 17, 2019, Charles Gilbert Murphy, 63, of Apex, NC, was charged in a 26-count federal indictment alleging various acts of Bank Fraud, Wire Fraud, Making False Statements on a Loan, Making False Statements to the FBI, Aggravated Identity Theft, and Subscribing to False Tax Returns. He was arrested by the FBI today in Raleigh. The Indictment alleges that Murphy was subject to collection efforts by the United States Government arising from a prior federal conviction for Wire Fraud in June of 1999 in this same district. As such, the Indictment alleges that Murphy caused family members to open bank accounts for him in the name of various companies he controlled, referred to in the Indictment as the “Murphy Entities.” These entities were Toxic Solutions LLC (“Toxic Solutions”), Biological Marine Remediation LLC (“Bio-Remediation”), Bio Marine Remediation LLC (“Bio-Marine”), Bio Separation Systems, LLC (“Bio-Separation”), On-Site Solutions LLC (“On-Site Solutions”), and On-Site Technologies LLC (“On-Site Technologies”). An Indictment is an allegation of a crime. The defendant is presumed under the law to be innocent until proven guilty. The Federal Bureau of Investigation, the Internal Revenue Service - Criminal Investigation and the North Carolina Department of the Secretary of State investigated this case. For more information, please see the press release.

On October 16, 2019, the U.S. Commodity Futures Trading Commission announced the filing of a civil enforcement action in the U.S. District Court for the District of Nevada, charging David Gilbert Saffron of Las Vegas, Nevada and Circle Society, Corp., a Nevada corporation, with fraudulent solicitation, misappropriation, and registration violations relating to an $11 million binary options scheme Saffron operated through Circle Society. The complaint was filed on September 30, 2019. The complaint charges that from at least December 2017 to the present, the defendants fraudulently solicited and accepted at least $11 million worth of bitcoin and U.S. dollars from individuals in the United States to trade off-exchange binary options on foreign currencies (“forex”) and cryptocurrency pairs, among other things. According to the complaint, the defendants fraudulently solicited funds from at least fourteen members of the public to participate in a pool operated by Circle Society, an entity Saffron created and used to perpetrate his fraud, by making false claims of Saffron’s trading expertise and guaranteeing rates of return up to 300%. Rather than using pool participants’ funds to trade in binary options contracts as promised, the defendants misappropriated funds, including by retaining participants’ funds in Saffron’s personal electronic cryptocurrency wallet and by using funds to pay other participants, in the manner of a Ponzi scheme. The defendants then lied to participants in order to conceal their misappropriation. The CFTC appreciates the assistance of the U.S. Attorney’s Office for the District of Nevada, the North Carolina Secretary of State’s Securities Division, and the Federal Bureau of Investigation’s Los Angeles Field Office. For more information, click here.

On October 14, 2019, the North Carolina Department of the Secretary of State, Securities Division entered into a Final Consent Order (“Order”) with Rising Tide, Inc. The Order found that Rising Tide failed, at all of its exams, to have written investment advisory contracts for all of its clients that complied with North Carolina law and that were signed by both the client and by Rising Tide. Pursuant to the Order, Rising Tide agreed to immediately cease and desist from violating any provisions of the North Carolina Investment Advisers Act and any related administrative rules, to pay a civil penalty, and to pay investigative costs. For more information, click here.

On September 30, 2019, the North Carolina Department of the Secretary of State, Securities Division entered into a Final Consent Order (“Order”) with Michael Paul Lessard, Jr. The Order found that Mr. Lessard had borrowed money from clients. Pursuant to the Order, Mr. Lessard's registration as a salesman was revoked effective May 10, 2018. He also agreed to immediately cease and desist from violating any provisions of the North Carolina Securities Act, the North Carolina Investment Advisers Act, and any related administrative rules. For more information, click here.

On September 12, 2019, the North Carolina Department of the Secretary of State, Securities Division entered into a Final Consent Order (“Order”) with Donald M. Rasmussen. The Order found that Mr. Rasmussen had not timely amended his Form U4 to disclose a tax lien, and that he used a professional designation he had not earned. Pursuant to the Order, Mr. Rasmussen agreed to immediately cease and desist from violating any provisions of the North Carolina Investment Advisers Act and any related administrative rules; keep his Form U4 updated; not use a professional designation unless properly earned; and pay a civil penalty. For more information, click here.

On May 13, 2019, the North Carolina Department of the Secretary of State, Securities Division entered into a Final Consent Order (“Order”) with David Todd Misenheimer. The Order found that Mr. Misenheimer had not timely amended his Form U4 to disclose several unsatisfied federal tax liens. Pursuant to the Order, Mr. Misenheimer agreed to immediately cease and desist from violating any provisions of the North Carolina Investment Advisers Act and any related administrative rules; update his Form U4; and pay a civil penalty. For more information, click here.

On May 6, 2019, the North Carolina Department of the Secretary of State, Securities Division entered into a Final Consent Order (“Order”) with Clyde Lawrence Yarbrough, III. The Order found that Mr. Yarbrough had not disclosed several unsatisfied federal tax liens on his Form U4. Pursuant to the Order, Mr. Yarbrough agreed to immediately cease and desist from violating any provisions of the North Carolina Investment Advisers Act and any related administrative rules; keep his Form U4 updated; and pay a civil penalty. For more information, click here.

On April 8, 2019, the North Carolina Department of the Secretary of State, Securities Division entered into a Final Order (“Order”) with First Oak Wealth Management, LLC (“First Oak”). The Order concluded that First Oak violated North Carolina law by using an individual as an investment adviser representative when that individual was not registered as an investment adviser representative; by failing to reasonably supervise that individual when he acted as an investment adviser representative; and by failing to provide written information about that individual to the prospective investment advisory clients the individual solicited. Pursuant to the Order, First Oak was ordered to immediately cease and desist violating N.C. Gen. Stat. §§ 78C-16(b) and 78C-19(a)(2)(j); immediately cease and desist violating 18 NCAC 06A .1707(b), .1801(a)(18), and .1808; to pay a civil penalty; to pay costs of investigation; and to provide certain clients with a copy of the Final Order. For more information, click here.

On April 8, 2019, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with LPL Financial LLC, regarding its maintenance of required books and records and its supervisory system with respect to the registrations of its securities products when entering into securities transactions with citizens of North Carolina. For more information, click here.

On December 3, 2018, the Securities Division entered into a Consent Order with Idlewild Financial, LLC ("Idlewild"). Idlewild had failed to respond to the Administrator's books and records requests. In lieu of further administrative action, Idlewild has agreed to withdraw its registration as an investment adviser. For more information, click here.

On November 28, 2018, the Securities Division entered into a Consent Order with Conestoga Trust Services LLC, Conestoga Settlement Services, LLC, and Conestoga International LLC ("Conestoga"). Conestoga used unregistered persons to offer and sell securities to North Carolina residents in violation of the Securities Act. Conestoga has agreed to cease this practice and to pay a monetary penalty. For more information, click here.

On October 25, 2018, the Securities Division entered an Order against Patriots Energy Group, Inc. ("PEG"). This matter was heard by an Administrative Law Judge. The Judge entered a Proposed Decision. The Administrator adopted the Findings and Conclusions from that Proposed Decision and entered an Order. The Judge and the Administrator found that PEG violated the securities laws when it hired two unregistered salesmen to sell its security interests and when it made misrepresentations and omitted material facts in order to entice investors to purchase security interests. The Administrator ordered PEG to immediately and permanently cease and desist a) employing any unregistered salesmen to sell securities to North Carolina residents. b) offering or selling the profit-sharing investments to residents of North Carolina, and c) violating any other provisions of the Securities Act. For more information, click here.

On October 2, 2018, the Securities Division entered into a Consent Order with Raymond Marx Financial Advisory Group, Inc. ("RMFAG"). RMFAG is a North Carolina registered investment adviser. RMFAG, along with Raymond Marx Financial, Inc. ("RMGI"), an insurance company jointly marketed their services. The Securities Division found that RMFAG touted its investment adviser services to attract clients to the joint RMFAG and RMFI office. Once there, the clients would be offered insurance products from RMFI. FMFAG has agreed to cease this practice and to pay a monetary penalty. For more information, click here.

On September 6, 2018, the Securities Division entered into a Consent Order with Ameriprise Financial Services, Inc. ("Ameriprise"). The Securities Division found that Ameriprise violated North Carolina law by failing to update its written supervisory procedures("WSPs"). The WSPs designated facsimile as the only method to transmit certain documents and led to delayed communication of important information. Ameriprise has updated its WSPs and consented to a monetary penalty. For more information, click here.

On September 4, 2018, the North Carolina Department of the Secretary of State, Securities Division entered into a Consent Order with Wesleyan Investment Foundation Inc. (“Wesleyan”). The Consent Order found that Wesleyan sold unregistered securities in North Carolina. Pursuant to the Consent Order, Wesleyan agreed, among other things, to immediately cease and desist from violating any provisions of the North Carolina Securities Act and any related administrative rules, to pay a civil penalty, and to pay investigative costs. For more information, click here.

On August 10, 2018, the Securities Division entered into a Consent Order with Richard Parkes ("Parkes"). The Securities Division found that Parkes was holding himself out as an investment adviser even though he was only licensed to sell insurance products. Parkes has agreed to cease holding himself out as an investment adviser and to pay a monetary penalty. For more information, click here.

On July 30, 2018, Karen and John Palczuk pleaded guilty in Wake County District Court to the sale of unregistered securities. This plea stems from Karen and John Palczuk’s involvement in a Virgin Island limited liability company that attempted to raise money from investors in order to build villas on the islands. According to the arrest warrants, the Palczuks sold investment contracts to North Carolina investors in amounts greater than $100,000. This class I felony carries with it a 6-17 month sentence which has been suspended for 12 months of probation.

On July 12, 2018, the Temporary Cease and Desist Order entered on January 9, 2018 against Bitconnect, BitConnect LTD, BitConnect International PLC and BitConnect Trading LTD ("BitConnect") became final. Since receiving the Temporary Cease and Desist Order Bitconnect has closed its exchange and lending operation. For more information, click here.

On June 12, 2018, Frank Calabro, Jr. (“Calabro”) entered into a Consent Order with the Deputy Securities Administrator agreeing to cease offering unregistered securities, acting as unregistered dealers/salesmen, and omitting to state material facts when offering securities. Click here to view the Consent Order. This Consent Order resolves the Temporary Cease and Desist Order entered on March 18, 2018. For more information, click here.

On May 30, 2018, the Securities Division of the North Carolina Department of Secretary of State issued an investor alert involving BitClub Network. For related information about a criminal matter involving BitClub Network, please see the information under the entry for December 10, 2019, above. For more information, click here.

On May 10, 2018, Adosia LLC and Kyle Solomon (“Respondents”) entered into a Consent Order with the Deputy Securities Administrator ("Administrator”). During an investigative sweep, the Administrator discovered that Respondents intended to undertake an initial coin offering (“ICO”). Prior to the commencement of the ICO, the Administrator alerted Respondents that the Administrator believed that token they intended to offer through the ICO was a security. As a result, the Respondents agreed to cease offering the token through the ICO and to provide a rescission offer to the investor who purchased the token during the ICO pre-sales. For more information, click here.

On April 19, 2018, the Temporary Cease and Desist Order entered on March 2, 2018 against Power Mining Pool ("PMP") became final, permanently barring PMP from, among other things, offering unregistered securities in North Carolina. For more information, click here.

On April 17, 2018, the Temporary Cease and Desist Order and the Summary Suspension entered on February 27, 2018 (see below) against RJM Financial, RJM Financial, LLC and Russell Joseph Mutter (the "RJM Respondents") became final, barring the RJM Respondents from administering or misappropriating client assets and revoking the investment adviser registration. Also, on February 8, 2022, a multi-year investigation led by law enforcement agents with the North Carolina Secretary of State’s Securities Division with the assistance of the US Postal Inspection Service ended with Forsyth County Superior Court Judge David Hall sentencing Russell Joseph Mutter to a minimum of 16 years, 3 months and a maximum of 22 years, 5 months in prison for a scam in which 12 victims – most of them elderly – lost over $3.3 million. Mutter was charged with 41 counts of Investment Adviser Fraud, Financial Exploitation of an Older Adult, and Obtaining Property by False Pretenses. (See Press Release for more information.) For more information, click here.

On April 17, 2018, Alan Carver and Dechoker, LLC entered into a Consent Order with the Deputy Securities Administrator agreeing to cease offering unregistered securities and acting as unregistered dealers/salesmen in North Carolina. Click here to view the Consent Order. Also on April 17, 2018, the Deputy Securities Administrator entered a Final Order against Russell Wadell, Mark Shores, and Mark Honeycutt making permanent the Temporary Cease and Desist Order in the matter of Dechoker, LLC, Alan Carver, Russell Wadell, Mark Shores, and Mark Honeycutt entered on February 15, 2018. For more information, click here.

On April 6, 2018, the Temporary Cease and Desist Order entered on February 16, 2018USI-Tech Limited ("USIT") became final, permanently barring USIT from, among other things, offering securities in North Carolina until such time as it becomes fully compliant with North Carolina's securities laws. For more information, click here.

On March 26, 2018, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into an Administrative Consent Order with LPL Financial, LLC (“LPL”) regarding its conduct surrounding the offers of non-traded real estate investment trusts (“REITs”) to citizens of North Carolina. The Order found that LPL failed to implement and enforce an adequate supervisory system which led to the improper conduct by its employees when offering the REITs. LPL will offer to remediate losses of all North Carolina residents who purchased the improperly sold REITs. LPL also paid a fine and investigative costs to the Secretary of State’s office. For more information, click here.

On March 8, 2018, the Securities Division of the North Carolina Department of Secretary of State issued a Temporary Cease and Desist Order to Frank Calabro, Jr. (“Calabro”). The Temporary Cease and Desist Order found that Calabro was not registered as a dealer or salesman of securities in North Carolina and offered and sold securities on behalf of multiple different companies in violation of the North Carolina Securities Act. The Temporary Cease and Desist Order ordered Calabro to cease and desist a) offering unregistered securities, b) acting as a securities dealer and/or salesman in North Carolina while not registered to do so, and c) making material misstatements and omissions of fact when offering securities. The Temporary Cease and Desist Order gives Calabro thirty (30) business days in which to request a hearing. If no such request is made during that time, the Temporary Cease and Desist Order shall become final. For more information, click here.

On March 2, 2018, the North Carolina Secretary of State issued a Temporary Cease and Desist Order to Power Mining Pool ("PMP"). The Temporary Cease and Desist Order found that PMP was not registered as a dealer or salesman of securities in North Carolina and offered investments called the mining pool shares, which were found to be securities. The Temporary Order to Cease and Desist also found that PMP had omitted to disclose material facts when offering the mining pool shares in North Carolina. These activities are in violation of the North Carolina Securities Act. The Temporary Cease and Desist Order directed PMP to cease and desist offering unregistered securities, acting as an a securities dealer in North Carolina while it is not registered to do so, and engaging in fraud in connection with the offer or sale of any security. The Temporary Cease and Desist Order gives PMP thirty (30) business days in which to request a hearing. If no such request is made during that time, the Temporary Cease and Desist Order shall become final. For more information, click here.

On February 27, 2018, the Securities Division of the North Carolina Department of the Secretary of State entered into a Final Consent Order (“Order”) with David Ralph Allison. The Order found that the respondent had transacted business in North Carolina as a dealer or salesman without being registered in North Carolina, and he had sold or offered to sell securities in North Carolina that were not registered in North Carolina, and that were not otherwise exempt from registration, or covered under federal law. Pursuant to the Order, Mr. Allison agreed to immediately cease and desist from violating any provisions of the North Carolina Securities Act and any related administrative rules. For more information, click here.

On February 27, 2018, the Securities Division of the North Carolina Department of Secretary of State issued a Temporary Cease and Desist Order to RJM Financial, RJM Financial, LLC and Russell Joseph Mutter (the “RJM Respondents”). The Temporary Cease and Desist Order found that the RJM Respondents violated the North Carolina Investment Advisers Act by misappropriating client funds. The Temporary Cease and Desist Order ordered the RJM Respondents to cease and desist soliciting new clients, administering the assets of current clients, misappropriating client funds, and engaging in fraud. The Temporary Cease and Desist Order gives the RJM Respondents thirty (30) business days in which to request a hearing. If no such request is made during that time, the Temporary Cease and Desist Order shall become final. See April 17, 2018 above for more information. Also, on February 8, 2022, a multi-year investigation led by law enforcement agents with the North Carolina Secretary of State’s Securities Division with the assistance of the US Postal Inspection Service ended with Forsyth County Superior Court Judge David Hall sentencing Russell Joseph Mutter to a minimum of 16 years, 3 months and a maximum of 22 years, 5 months in prison for a scam in which 12 victims – most of them elderly – lost over $3.3 million. Mutter was charged with 41 counts of Investment Adviser Fraud, Financial Exploitation of an Older Adult, and Obtaining Property by False Pretenses. (See Press Release for more information. For more information, click here.

On February 27, 2018, the Securities Division of the North Carolina Department of Secretary of State issued an Order of Summary Suspension (the “Order”) to RJM Financial, RJM Financial, LLC and Russell Joseph Mutter (the “RJM Respondents”). The Order found that the RJM Respondents violated the North Carolina Investment Advisers Act by filing misleading and false documents with the Secretary of State’s office, and by engaging in a course of business which operated as a fraud. The Order suspends the registration of the RJM Respondents. The Order gives the RJM Respondents thirty (30) business days in which to request a hearing. If no such request is made during that time, the Order shall become final (see April 17, 2018 above). Also, on February 8, 2022, a multi-year investigation led by law enforcement agents with the North Carolina Secretary of State’s Securities Division with the assistance of the US Postal Inspection Service ended with Forsyth County Superior Court Judge David Hall sentencing Russell Joseph Mutter to a minimum of 16 years, 3 months and a maximum of 22 years, 5 months in prison for a scam in which 12 victims – most of them elderly – lost over $3.3 million. Mutter was charged with 41 counts of Investment Adviser Fraud, Financial Exploitation of an Older Adult, and Obtaining Property by False Pretenses. (See Press Release for more information.) For more information, click here.

On February 16, 2018, the North Carolina Secretary of State issued a Temporary Cease and Desist Order to USI-Tech Limited ("USIT"). The Temporary Cease and Desist Order found that USIT was not registered as a dealer or salesman of securities in North Carolina and offered investments called the BTC Package, which were found to be securities. The Temporary Order to Cease and Desist also found that USIT had omitted to disclose material facts when offering the BTC Package in North Carolina. These activities are in violation of the North Carolina Securities Act. The Temporary Cease and Desist Order directed USIT to cease and desist offering unregistered securities, acting as an a securities dealer in North Carolina while it is not registered to do so, and engaging in fraud in connection with the offer or sale of any security. The Temporary Cease and Desist Order gives USIT thirty (30) business days in which to request a hearing. If no such request is made during that time, the Temporary Cease and Desist Order shall become final. For more information, click here.

On February 15, 2018, the Securities Division of the North Carolina Department of Secretary of State issued a Temporary Cease and Desist Order to Dechoker, LLC, Alan Carver, Russell Wadell, Mark Shores and Mark Honeycutt (the “Dechoker Respondents”). The Temporary Cease and Desist Order found that the Dechoker Respondents were not registered as dealers or salesmen of securities in North Carolina and offered and sold interests in Dechoker, LLC; these activities are in violation of the North Carolina Securities Act. The Temporary Cease and Desist Order ordered Dechoker Respondents to cease and desist offering unregistered securities and acting as securities dealers and/or salesmen in North Carolina while not registered to do so. The Temporary Cease and Desist Order gives the Dechoker Respondents thirty (30) business days in which to request a hearing. If no such request is made during that time, the Temporary Cease and Desist Order shall become final. For more information, click here.

On February 15, 2018, lan Peter Darcy (aka Alan D’Arcy, aka Irish Darcy), of Murphy, NC, was sentenced in federal district court to 108 months in federal prison for his part in orchestrating an $800,000 investment fraud scheme (press release). Darcy was indicted on March 24, 2017, by a federal grand jury on one count of wire fraud, to which he later pleaded guilty (see this press release). According to documents filed with the court, in or about February 2012 through at least June 2016, Darcy engaged in a scheme to defraud multiple victims of more than $800,000 by inducing them to invest in a variety of bogus financial instruments and products, such as fraudulent “cash flow contracts,” “Joint Participation Agreements,” and leased “Bank Guarantees.” Contrary to his representations, Darcy did not hold the victims’ money in escrow or create trust accounts for the victims. Instead, he deposited the money into bank accounts he controlled and spent more than $400,000 of the victims’ money to fund his personal lifestyle, including through large amounts of cash withdrawals and personal expenditures such as pet care, entertainment, travel and the purchase of a used Jaguar automobile.

On January 24, 2018, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into an Administrative Consent Order with UVEST Financial Services Group, Inc., regarding registrations of its representatives when entering into securities transactions with citizens of North Carolina. For more information, click here.

On January 10, 2018, the Securities Division of the North Carolina Department of Secretary of State issued an Investor Alert on Investment Schemes Involving Cryptocurrencies. For more information, click here.

On January 9, 2018, the Securities Division of the North Carolina Department of Secretary of State issued a Temporary Order to Cease and Desist to Bitconnect, BitConnect LTD, BitConnect International PLC and BitConnect Trading LTD ("BitConnect"). BitConnect was ordered to cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities unless and until such securities have been registered and BitConnect, and any person or entity under the direction or control of BitConnect, is properly registered as a securities dealer or salesman. The Temporary Order to Cease and Desist found that BitConnect. was not registered as a dealer or salesman of securities in North Carolina and offered investments called the BitConnect Lending Program and the BitConnect Staking Program. The Temporary Order to Cease and Desist also found that BitConnect had omitted to disclose material facts when offering these investments in North Carolina. These activities are in violation of the North Carolina Securities Act. The Temporary Order to Cease and Desist gives BitConnect thirty (30) business days in which to request an hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. For more information, click here.

On December 4, 2017, the Securities Division of the North Carolina Department of the Secretary of State and Wells Fargo Investments, LLC, reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On November 30, 2017, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with Carlton Hall Asset Management, LLC and Carlton Gray Hall, Jr. The Consent Order found that the respondents had failed to supervise an investment adviser representative of Carlton Hall Asset Management, LLC. Pursuant to the Consent Order, respondents agreed to immediately cease and desist from violating any provisions of the North Carolina Investment Advisers Act and any related administrative rules, and to pay a civil penalty. For more information, click here.

On November 15, 2017, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with Small People Group ("SPG") and Stanley Patterson("Patterson"). The Consent Order found that SPG and Patterson offered unregistered securities to the investing public. Neither SPG nor Patterson were registered, nor did they secure a crowdfunding exemption for the securities. The Consent Order ordered SPG and Patterson to cease and desist selling unregistered securities. For more information, click here.

On November 3, 2017, the Securities Division of the North Carolina Department of the Secretary of State and Stifel, Nicolaus & Company, Incorporated, reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On November 2, 2017, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with JGM Wealth Management, L.L.C. (“JGM”) and John G. Mergner, Jr. (“Mergner”). The Consent Order found that JGM and Mergner frequently failed to file registration documents promptly and made material misstatements in filings with the Administrator. The Administrator ordered JGM and Mergner to update the misleading filings and then withdraw the registration. For more information, click here.

On October 23, 2017, the Securities Division of the North Carolina Department of the Secretary of State and Raymond James & Associates, Inc. and Raymond James Financial Services, Inc., reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On October 11, 2017, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with Hightower Financial Partners, LLC (“Hightower”). The Consent Order found that Hightower had filed a document with the Secretary of State which was false or misleading, and that it failed to promptly file a correcting amendment after a document it had previously filed became inaccurate. Pursuant to the Consent Order Hightower agreed to withdraw its registration as an investment adviser in North Carolina, and to immediately cease and desist from violating any provisions of the North Carolina Investment Advisers Act, the North Carolina Securities Act or any administrative rules promulgated under either Act. For more information, click here.

On October 4, 2017, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into an Administrative Consent Order with J. P. Morgan Securities LLC, regarding its supervisory system with respect to the registrations of its sales assistants when entering into securities transactions with citizens of North Carolina. For more information, click here.

On September 28, 2017, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with SCD Capital, Inc. and Scott Daily. The Consent Order found that SCD and Daily “cherry-picked” trades for personal gain, made false or misleading statements to clients, and made material misstatements in filings with the Administrator. The Administrator ordered that SCD and Daily accept a two day suspension, cease and desist such activities and pay fines. For more information, click here.

On September 24, 2017, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with LPL Financial LLC. The Consent Order found that LPL had failed to reasonably supervise its salesman Charles Caleb Fackrell and failed to observe high standards of commercial honor. Pursuant to the Consent Order, LPL paid a civil penalty, reimbursed the Securities Division for investigative costs associated with the matter, and was ordered to immediately cease and desist from violating any provisions of the North Carolina Securities Act, the North Carolina Investment Advisers Act, or any administrative rules promulgated under either Act. Click here and here for press releases regarding Charles Caleb Fackrell. For more information, click here.

On September 15, 2017, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with SAJJDBORDEAUX, Inc. and Jeffrey Bordeaux. During an Internet sweep, the Securities Division found that SAJJDBORDEAUX, Inc. and Jeffrey Bordeaux were offering unregistered securities to the investing public through Craigslist. Neither SAJJDBORDEAUX, Inc. nor Jeffrey Bordeaux were registered, nor did they secure a crowdfunding exemption for the securities. The Consent Order ordered SAJJDBORDEAUX, Inc. and Jeffrey Bordeaux to cease and desist selling unregistered securities. For more information, click here.

On August 28, 2017, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into an Administrative Consent Order with RBC Capital Markets, LLC, regarding its supervisory system with respect to the registrations of its Client Associates when entering into securities transactions with citizens of North Carolina. For more information, click here.

On August 15, 2017, Robert Louis Winecoff, of Huntersville, NC, was sentenced in federal district court to 51 months in federal prison for operating an investment fraud scheme involving bogus investment products. Winecoff previously pleaded guilty in March 2017 to one count of wire fraud. According to documents filed with the court, from June 2013 to May 2014, Winecoff executed a scheme to defraud approximately 12 investors from several different countries out of approximately $343,000 by inducing them to invest in a variety of bogus investment instruments and products. Rather than invest his victim-investors’ money as promised, Winecoff diverted the funds for his own personal use. Court records show that Winecoff made purchases totaling nearly $65,000 at hotels, airlines, gas stations, and retail stores. He also made cash withdrawals totaling nearly $308,000 from the account into which victims had wired their money. All federal sentences are served without the possibility of parole. The Securities Division of the North Carolina Secretary of State and the US Postal Inspection Service led the investigation. Assistant U.S. Attorney William Miller, of the U.S. Attorney’s Office in Charlotte, prosecuted the case. Winecoff is not scheduled for release until January 21, 2021. For more information, click here.

On July 12, 2017, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into an Administrative Consent Order with Citigroup Global Markets Inc., regarding its supervisory system with respect to the registrations of its sales assistants when entering into securities transactions with citizens of North Carolina. For more information, click here.

On July 10, 2017, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with Deloitte Corporate Finance LLC. The Consent Order found that Deloitte Corporate Finance LLC had failed to reasonably supervise certain of its salesmen in Charlotte, and that it failed to file accurate and complete Form U4s or file timely amendments to Form U4s with respect to certain of its salesmen in Charlotte. For more information, click here.

On May 25, 2017, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into an Administrative Consent Order with ProEquities, Inc., regarding registrations of its representatives when entering into securities transactions with citizens of North Carolina. For more information, click here.

On April 4, 2017, Ronald Earl McCullough, of Atlanta, GA, was sentenced in US District Court to 120 months imprisonment, followed by 3 years of supervised release, for his role in an investment fraud scheme that spanned from January 2009 to May 2012 and swindled more than $2,000,000 from investors. He also was ordered to make payment of $1,726,400 in restitution (press release). McCullough was named in a Superseding Indictment filed on July 2, 2014. He was originally indicted on July 9, 2013. For information about his co-defendant, David Christopher Mayhew, see the entries at June 12, 2105 and January 7, 2016 below. At codefendant Mayhew’s trial, the Government presented evidence that both Mayhew and McCullough were involved in an investment fraud scheme that promised investors returns as much as 100% in 30 days. One victim testified that he had lost his family’s house as a result of the fraud. Two other victims testified that they had to back out of contracts to purchase property because of the fraud. Investigation of this case was conducted by the FBI, the IRS Criminal Investigation, the Postal Inspection Service, and the North Carolina Secretary of State’s office, Securities Division.

On March 24, 2017, Alan Peter Darcy, of Murphy, NC, was indicted by a federal grand jury with wire fraud for orchestrating an $800,000 investment fraud scheme (see press release. According to allegations contained in the indictment, in or about February 2012 through at least June 2016, Darcy engaged in a scheme to defraud multiple victims of more than $800,000 by inducing them to invest in a variety of bogus financial instruments and products, such as fraudulent “cash flow contracts,” “Joint Participation Agreements,” and leased “Bank Guarantees.” As alleged in the indictment, Darcy claimed to provide various types of project funding and private banking services through Sceptre LLC (Sceptre), Mission 1, LLC (Mission 1), and related entities which Darcy controlled. Darcy further claimed that he had access to, and multiple successes with, specialized opportunities for obtaining private banking instruments and engaging in lucrative trading opportunities not available to the general public. For information about his sentencing, see the entry at February 15, 2018 above.

On December 6, 2016, Charles Caleb Fackrell, of Booneville, NC, was sentenced to 63 months in prison for operating a $1.4 million Ponzi scheme. Fackrell was also ordered to serve three years under court supervision after he is released from prison, and to pay $819,918 as restitution to his victims (see press release). Court records indicate that Fackrell solicited his victim investors by making false and fraudulent representations, including that the investors’ money would be invested in, or secured by, gold and other precious metals, when in fact Fackrell spent only a fraction of investor money on such assets. According to court records, Fackrell also falsely told victims that Robin Hood was a very safe investment, paying guaranteed annual returns of 5% to 7%. According to court records, contrary to the promises he made to his victims and instead of investing the victims’ funds as promised, Fackrell used the majority of the money to cover personal expenditures, including hotel expenses, groceries, and medical bills, to make purchases at various retail shops and to make large cash withdrawals. Fackrell also used a portion of the victims’ money to make purported “interest” payments to investors who demanded their money back and to induce further investments from existing investors and their friends and family members. In all, according to court records, Fackrell diverted over $700,000 of his victims’ money – nearly half of the investor money he obtained – back to other investors in Ponzi fashion payments. See also the entry for April 12, 2016 below.

On October 24, 2016, the North Carolina Secretary of State's Securities Division entered into a Consent Order with Palmetto Premier Advisors, LLC. The Consent Order ordered that the Respondents immediately cease and desist from transacting business in this State in violation of the provisions of the North Carolina Investment Advisers Act or the rules thereunder. For more information, click here.

On October 18, 2016, the Securities Division of the North Carolina Department of the Secretary of State issued a Final Order against Daniel P. Sexton. The Order obligates Mr. Sexton to cease and desist from violating the N.C. Securities Act (G.S. Ch. 78A) and also to accurately report information on Form U-4. Mr. Sexton further agreed to amend his Form U-4 in a timely manner. In addition, the Order required a monetary payment of $1,000.00 in settlement of the Securities Division's investigation. The Order found Mr. Sexton had failed to disclose business activities outside the scope of his employment with his securities dealer and, consequently, had filed an incomplete application for registration under the N.C. Securities Act. For more information, click here.

On July 14, 2016, the North Carolina Secretary of State's Securities Division issued an Order of Summary Postponement to Palmetto Premier Advisors, LLC. The Order of Summary Postponement ordered pursuant to the authority contained in N.C.G.S. §78C-19(c) and 78C-19(f), that, pending a hearing and a final determination of this matter, the North Carolina registration of Palmetto Premier Advisors, LLC as an investment adviser be postponed. For more information, click here.

On April 12, 2016, Charles Caleb Fackrell, of Booneville, NC, appeared before a U.S. magistrate today and pleaded guilty to one count of securities fraud for operating a $1.4 million Ponzi scheme (see press release). Fackrell was initially arrested by the Yadkinville Police Department in December 2014. According to filed court documents and today’s plea hearing, beginning from in or about May 2012 to about December 2014, Fackrell executed a Ponzi scheme using approximately $1.4 million in funds he solicited from at least 20 victim investors in Wilkes County and elsewhere. According to court records, Fackrell was a stockbroker who used his position of trust to solicit victim investors and steer them away from legitimate investments to purported investments with “Robin Hood, LLC,” “Robinhood LLC,” “Robin Hood Holdings, LLC,” “Robinhood Holdings, LLC” and related entities (collectively, “Robin Hood”). These were entities Fackrell controlled and through which he could access the victims’ funds. For information about his sentencing, see the entry at December 6, 2016 above.

On January 7, 2016, David Christopher Mayhew, of Raleigh, NC, was sentenced in US District Court to 320 months imprisonment, followed by 3 years of supervised release, for his role in an investment fraud scheme that spanned from January 2009 to May 2012 and swindled more than $2,000,000 from investors, promising them returns as much as 100% in 30 days (press release). He was also ordered to repay $2,025,300 in restitution. For information about his conviction on Conspiracy, Wire Fraud, Mail Fraud, and Money Laundering charges, please see the entry at June 12, 2015 below. For information about his co-defendant, Ronald Earl McCullough, please see the entry at April 4, 2017 above. At trial, one victim testified that he had lost his family’s house as a result of the fraud. Two other victims testified that they had to back out of contracts to purchase property because of the fraud. Investigation of this case was conducted by the FBI, the IRS Criminal Investigation, the Postal Inspection Service, and the North Carolina Secretary of State’s Office, Securities Division.

On September 17, 2015, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with UBS Financial Services Inc., regarding its supervisory system with respect to the registrations of its Client Associates when entering into securities transactions with citizens of North Carolina. For more information, click here.

On September 3, 2015, Nathan Shane Wolf and John Wayne Perry, Jr., both of Charlotte, were sentenced by Senior U.S. District Judge Graham C. Mullen on federal racketeering charges for their roles in the mortgage and investment fraud schemes codenamed “Operation Wax House” ( press release). An additional defendant, Purnell Wood, was sentenced on Friday, July 31, 2015 for his role in the federal racketeering Enterprise. Wolf, a licensed real estate agent, was sentenced to 7 years in prison followed by three years of supervised release. Perry was sentenced to 24 months in prison followed by two years of supervised release. Wood was sentenced to 21 months in prison followed by one year supervised release. For additional information, see the entries at May 29, 2015, February 18, 2015, January 27, 2015, September 23, 2014, June 26, 2014, October 23, 2013, July 10, 2013, and April 24, 2013, respectively.

On August 3, 2015, James H. Mason, 67, of Graham, N.C., was sentenced in US District Court to 96 months in prison for orchestrating a Ponzi scheme that solicited victims to invest millions in the foreign currency market (“FOREX”). Mason was also ordered to serve three years under court supervision and to pay $4,325,820.79 as restitution to the victims of his fraud. North Carolina Secretary of State Elaine F. Marshall and John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI), join Acting U.S. Attorney Rose in making the announcement. For more information, please see this press release. See also the entries at March 27, 2013 and April 30, 2013 below.

On July 23, 2015, Claude Darrell McDougal, of Charlotte, was sentenced in US District Court to 78 months in prison for orchestrating a Ponzi scheme that defrauded his investor victims of over $2.5 million. He was also ordered to serve two years under court supervision after he is released from prison and to pay $2,020,078.26 as restitution to the victims of his fraud (press release). Between 2006 and 2010, McDougal induced over 25 investors to invest more than $2.5 million, by promising that their money would be invested in securities. McDougal created Charlotte-based US Financial Alliance Consultants, LLC ("Financial Alliance") in 2005, a company that was never registered as a dealer of securities in North Carolina or elsewhere. McDougal was also not registered to sell securities in North Carolina or in any other state. Victims, many of whom were elderly and invested most, if not all, of their life-savings, were induced to invest with Financial Alliance by McDougal falsely “guaranteeing” fixed rates of return between 6% and 15% annually. Only $580,000 of the victims’ money was invested and McDougal used approximately $450,000 to pay some victims supposed “payouts” from profits made on investments. However, these payments were not based on profits, but came from funds contributed by new investors. McDougal also used approximately $1.19 million of the investors’ funds to support his own lifestyle, including purchasing dinners, jewelry and electronics, and to pay for hotel stays, furniture and other expenses. For additional information, see the entry at July 24, 2014 below.

On June 12, 2015, David Christopher Mayhew, of Raleigh, NC, was convicted on Conspiracy, Wire Fraud, Mail Fraud, and Money Laundering charges in US District court (press release). He had been named in a Superseding Indictment filed on July 2, 2014. For information about his co-defendant, Ronald Earl McCullough, please see the entry at April 4, 2017 above. At trial, the Government presented evidence that Mayhew was involved in an investment fraud scheme that spanned from January 2009 to May 2012 and swindled more than $2,000,000 from investors, promising them returns as much as 100% in 30 days. One victim testified that he had lost his family’s house as a result of the fraud. Two other victims testified that they had to back out of contracts to purchase property because of the fraud. Investigation of this case was conducted by the FBI, the IRS Criminal Investigation, the Postal Inspection Service, and the North Carolina Secretary of State’s Office, Securities Division. For information about his sentencing, please see the entry at January 7, 2016 above.

On May 29, 2015, a significant development occurred in OPERATION WAX HOUSE.
“Operation Wax House” is a $75 million racketeering (RICO) conspiracy involving securities and mortgage fraud that targeted communities in the Mecklenburg and Union Counties in North Carolina. The Enterprise engaged in an extensive pattern of racketeering activities, consisting of investment fraud, mortgage fraud, bank fraud, money laundering, and distribution of illegal drugs. Ninety (90) defendants were charged and have either pleaded guilty or have been convicted following a trial. One remaining defendant is international fugitives. "Operation Wax House" is being handled jointly by the Charlotte Division of the FBI, the Criminal Division of the IRS and the Securities Division of the North Carolina Secretary of State. In addition to the four entries below, see the entries at September 3, 2015, February 18, 2015, January 27, 2015, September 23, 2014, October 23, 2013 and July 10, 2013, respectively.

• On May 29, 2015, Toby Hunter, of Fort Mill, SC, was sentenced to 108 months in prison, three years of supervised release, and was ordered to pay $8,095,903.80 in restitution to victims for his role in this scheme (press release). Hunter and his conspirators defrauded more than 50 investors out of millions through a scheme involving obtaining mortgage loans under false pretenses. They converted the money to their own personal use including private jets, high profile offices, entertaining themselves and others, and supporting their luxurious lifestyles. In December 2013, Hunter pleaded guilty to one count of racketeering conspiracy. According to filed court documents and statements made during Hunter’s sentencing hearing, Hunter served the racketeering enterprise as the Chief Investment Officer for Prestige Capital Advisors, one of the entities used to defraud investor-victims. Hunter was a registered commodity trading advisor with the National Futures Association (NFA), and had passed the Financial Industry Regulatory Authority (FINRA) Series 6 and Series 63 exams. Hunter registered Prestige Capital Advisor with the NFA, and used his education, licenses, and supposed experience to help lure investor victims to the scheme, including a victim defrauded of $4 million.
• On May 26, 2015, a US District Court sentenced four defendants for their involvement in mortgage and investment fraud schemes codenamed “Operation Wax House” (press release). These were three of the conspiracy’s leaders. James Tyson, Jr., of Charlotte, NC, was sentenced to 30 years in prison, Carrie Tyson, of Winterville, NC, to 18 years in prison, Victoria Hunt, of Rockville, MD, to 8 years in prison, and Vonetta Tyson Barnes, of Mililani, HI, to 30 days in prison. Each defendant was also sentenced to serve a term of three years supervised release. Tyson, Jr., his mother, Carrie Tyson, and Victoria Hunt are three of the leaders of the Racketeering Influenced Corrupt Organization (RICO) (the “Enterprise”) which operated in Mecklenburg and Union Counties from approximately 2005 until the defendants were arrested in 2012. A fourth leader, Ramin Amini, remains a fugitive. The Enterprise was responsible for a mortgage fraud and an investment fraud scheme that collectively defrauded victims of more than $75 million.
• On June 26, 2014, a federal jury convicted Steven Jones, of Waxhaw, NC, in connection with his involvement in the $75 million racketeering conspiracy codenamed “Operation Wax House” (press release). According to trial evidence, Jones was a promoter in the enterprise’s investment fraud operations, bringing in multiple investors, including an attorney, who Jones and his co-conspirators defrauded out of $3.7 million. Trial evidence established that throughout a seven year period the enterprise created a series of sham corporations to convince individuals to invest money. When investors would become aware of the problems with one corporation the enterprise would start a new corporation with new officers on paper to continue to defraud still further investors, court records show. Trial evidence also showed that Jones and others defrauded victims not of just money they had, but also caused the victims to take out expensive loans and to invest those loan proceeds based on false promises. According to evidence presented at trial, Jones and his co-conspirators used the investors’ money for personal expenditures, including private jets, high profile offices, entertaining themselves and others, and supporting their luxurious lifestyles. In total, the enterprise’s investment fraud operations took approximately $48 million from investors.
• On April 24, 2013, a federal superseding indictment unsealed in U.S. District Court charged nine additional defendants in Charlotte and elsewhere with racketeering, investment fraud, mortgage fraud, bank bribery and money laundering (press release). This latest round of criminal charges resulting from Operation Wax House, a mortgage fraud investigation which began in the Western District of North Carolina in 2007, brings the total number of defendants charged to date to 92, of which 66 have pleaded guilty. According to allegations contained in the unsealed indictment, the Enterprise, which operated from about 2005 through 2012, engaged in an extensive pattern of racketeering activities, consisting of investment fraud, mortgage fraud, bank fraud, money laundering and distribution of illegal drugs. Members of the Enterprise also bribed bank officials. In the investment fraud portion of the racketeering activities, the co-conspirators targeted professional athletes and doctors as well as their personal and professional acquaintances and convinced them to invest in a series of sham corporations controlled by the Enterprise. For example, members of the Enterprise told potential investors that one of the sham corporations, PEI, was a commodities trading company that would broker deals for the supposed export-import of various commodities like rice-trading and gold and diamond mining in Africa. In truth and fact, instead of investing the victims’ money as promised, the Enterprise used the funds obtained through PEI to support its members’ lifestyles and to make Ponzi-style payments to other victims. The co-conspirators stole over $27 million from more than 50 investor victims, including monies that the investor victims were induced to obtain as loans from financial institutions. Defendants added in this superseding indictment are:
  • William Brown, of Matthews, NC;
  • Benjamin Clarke, of Smyrna, GA;
  • Frank DeSimone, of Charlotte, NC;
  • Lorie Dooley, of Washington, DC:
  • James E. Fink, of Waxhaw, NC:
  • Ralph Johnson, of Charlotte, NC;
  • Denetria Myles, of Charlotte, NC;
  • Matthew Newland, of Coralville, IA;
  • Nazeere Saddig, formerly of Charlotte, NC.

On May 26, 2015, Michael Anthony Jenkins of Raleigh, NC, pleaded guilty on May 26, 2015, to three counts of felony securities fraud and one count of felony obtaining property by false pretenses. Jenkins admitted to running a classic Ponzi scheme through a company called Harbor Light Asset Management, by which he paid off earlier investors with money he received from later investors. He also converted investors’ fund to his own personal use. Jenkins told investors he would use their funds to trade commodities futures or “E-mini futures” through Harbor Light Asset Management. Through false promises of investing in commodities futures, and false monthly updates, Jenkins defrauded victims out of an estimated $1.79 million from January 2011 to 2012. He was never registered with the NC Securities Division to sell securities, or with the National Futures Association to act as a commodities trader. The U.S. District Court for the Eastern District of North Carolina entered an Order for a permanent injunction against Harbor Light Asset Management, LLC (HLAM) and Michael Anthony Jenkins. The Order requires HLAM and Jenkins jointly to pay restitution totaling $1,301,406.60 and a civil monetary penalty of $3,904,219.80. Jenkins was sentenced to a minimum of 9 years 8 months, and a maximum of about 13 years. For more information, please see our press release and the November 23, 2012, press release from the Commodity Futures Trading Commission. Jenkins was originally arrested by law enforcement agents with the North Carolina Secretary of State Division of Securities on August 17, 2012. For more information, see our press release.

On May 15, 2015, the Securities Division of the North Carolina Department of Secretary of State issued a Final Order of Revocation (Order) against Aegis Capital, LLC (Aegis). The Order revoked Aegis's registration to operate as an Investment Adviser in North Carolina. The Order found that Aegis had violated provisions of the Investment Advisers Act. For more information, click here.

On May 4, 2015, the Securities Division of the North Carolina Department of Secretary of State issued a Final Order to Cease and Desist against CAUSwave, Inc. This Order made permanent the terms of the Temporary Order to Cease and Desist issued on March 12, 2015. The Final Order found that CAUSwave, Inc. has violated the North Carolina Securities Act. The Order directs CAUSwave, Inc. and any person, employee, officer, director, entity or independent contractor under the direction or control of CAUSwave, Inc, to cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities unless and until: (1) such securities have been registered under the provisions of the North Carolina Securities Act, and (2) CAUSwave, Inc. and any person or entity under the direction or control of CAUSwave, Inc. is properly registered as a securities dealer or salesman under the provisions of the North Carolina Securities Act. For more information, click here.

On March 20, 2015, the Securities Division of the North Carolina Department of Secretary of State issued an Order of Summary Suspension (Order) against Aegis Capital, LLC (Aegis). The Order suspended Aegis’s registration to operate as an Investment Adviser in North Carolina. The Order found that Aegis had violated provisions of the Investment Advisers Act. The Order gives Aegis thirty (30) business days in which to request a hearing. If no such request is made during that time, the Order shall become final. For more information, click here.

On March 12, 2015, the Securities Division of the North Carolina Department of Secretary of State issued a Temporary Order to Cease and Desist to CAUSwave, Inc. CAUSwave, Inc. was ordered to cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities unless and until such securities have been registered and CAUSwave, and any person or entity under the direction or control of CAUSwave is properly registered as a securities dealer or salesman. The Temporary Order to Cease and Desist found that CAUSwave, Inc. was not registered as a dealer or salesman of securities in North Carolina and offered and sold shares of its unregistered stock; these activities are in violation of the North Carolina Securities Act. The Temporary Order to Cease and Desist gives CAUSwave, Inc. thirty (30) business days in which to request an hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. For more information, click here.

On February 18, 2015, Denetria Myles, of Charlotte, NC, Frank DeSimone, of Charlotte, NC, and William Brown, of Matthews, NC, were sentenced by U.S. District Court Judge Graham C. Mullen on federal racketeering charges for their roles in the mortgage and investment fraud schemes codenamed “Operation Wax House” (press release). One additional defendant, Sean Williams, was sentenced on February 3, 2015 for his role in the scheme. Myles was sentenced to 51 months in prison followed by three years of supervised release. DeSimone was sentenced to 51 months in prison, followed by two years of supervised release. Brown was sentenced to 48 months in prison followed by one year of supervised release. Williams was sentenced to 30 months in prison followed by two years of supervised release. For additional information, see the entries at September 3, 2015, May 29, 2015, January 27, 2015, September 23, 2014, June 26, 2014, October 23, 2013, July 10, 2013, and April 24, 2013, respectively.

On February 12, 2015, the Securities Division of the North Carolina Department of Secretary of State issued a Final Order to Cease and Desist against respondents Stark Innovations, L.L.C., and David Alan Topping, doing business as "Stark Investments, Inc." This Order makes permanent the terms of the Temporary Order to Cease and Desist issued on November 5, 2014 in this matter. Respondents failed to object to the issuance of the Final Order or to seek any hearing in this matter. Respondents are prevented and restrained from offering to sell, or selling, securities interests in Stark Innovations, L.L.C., or any other security, in North Carolina without first complying with the North Carolina Securities Act For more information, click here.

On February 11, 2015, Stephen E. Maiden, of Vienna, Va., was sentenced to 84 months in prison, followed by one year of supervised release for carrying out an $8.9 million Ponzi scheme. He was also order to pay $7,755,752 as restitution (see press release). See the entry at May 23, 2013 below for information about his guilty plea. According to filed court documents and today’s sentencing hearing, Maiden, formerly of Charlotte, carried out the scheme through his Charlotte-based hedge fund, Maiden Capital Opportunity Fund (“Maiden Capital”), which he formed in 2006. According to court records, Maiden represented to his victims that the fund was doing well and was profitable. By at least February 2009, however, he had lost the majority of the fund’s assets in failed investments. Beginning in at least February 2009, Maiden began transmitting bogus account statements to his investor victims and to Maiden Capital’s fund administrator, falsely reporting favorable returns. To keep the scheme going, Maiden used money from new investors to satisfy withdrawal requests made by other fund investors, falsely characterizing the transactions as payments from Maiden Capital’s successful operations. As a result of his unlawful conduct, Maiden caused a total loss of at least $8.9 million to approximately 39 victims.

On January 27, 2015, Matthew Newland, of Iowa, was sentenced by Senior U.S. District Judge Graham C. Mullen to serve 13 months in prison followed by one year of supervised release on federal racketeering charges for his role in the mortgage and investment fraud schemes codenamed “Operation Wax House” (press release). Four other defendants were sentenced earlier this month. On January 27, 2015, Lorie Dooley, of Charlotte, NC, was sentenced to 46 months in prison, followed by three years of supervised release. On January 20, 2015, Travis Bumpers of Charlotte, NC, was sentenced to 66 months in prison and three years of supervised release. On January 8, 2015, Ralph Johnson, of Charlotte, NC, was sentenced to 27 months in prison and two years of supervised release. Also on January 8, 2015, Benjamin Clarke, of Atlanta, GA, was sentenced to an eight month split sentence, followed by two years of supervised release. For additional information, see the entries at September 3, 2015, May 29, 2015, February 18, 2015, September 23, 2014, June 26, 2014, October 23, 2013, July 10, 2013, and April 24, 2013, respectively.

On January 27, 2015, the Securities Division of the North Carolina Department of the Secretary of State entered into a Final Consent Order with Respondent, McGrath & Associates, Inc. McGrath & Associates, Inc. is a registered investment adviser in the State of North Carolina. McGrath & Associates, Inc. violated the registration provisions of the North Carolina Investment Advisers Act by employing an unregistered investment adviser representative. The unregistered investment adviser representative was fully qualified for registration. The registration violation came to the Securities Division’s attention through a routine audit of the investment adviser. McGrath & Associates, Inc. properly registered the investment adviser representative on May 13, 2014. For more information, click here.

On December 30, 2014, an Order of Default Judgment was entered against Edwin A. Vasquez and his company, Vasquez Global Investments, LLC (VGI), for defrauding participants in a commodity pool commonly known as the Vasquez pool (see press release issued by the Commodity Futures Trading Commission). Vasquez and VGI are liable, jointly and severally, to pay $331,556 in restitution and must also pay a civil monetary penalty of $994,668. The Order also imposes permanent trading, solicitation, and registration bans. Beginning in August 2011, Vasquez, acting individually and through VGI, defrauded and deceived at least 19 participants who invested at least $583,491 in the Vasquez pool. Vasquez told prospective pool participants that he was a successful trader and that the VGI pool was a “no risk” investment. In fact, of the $583,491 solicited and accepted from pool participants Vasquez and VGI lost $65,374 trading commodity futures and misappropriated $331,556 by using those funds to pay for VGI’s operating costs and for Vasquez’s personal expenses. During that time, Vasquez did not disclose his trading losses and misappropriation and, instead, issued false statements to the pool participants regarding the profitability and value of their shares of the pool. For more information, please see the CFTC’s 8/7/2014 press release. The Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Order to Cease and Desist against Vasquez and his company on October 22, 2013, for violating the North Carolina Securities Act. For more information, click here.

On December 19, 2014, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with respondents, Senior Veterans Council, LLC, and David L. Cole. Respondent Senior Veterans Council, LLC, through its agent, Respondent David L. Cole improperly held itself out to the North Carolina investing public as an investment adviser licensed to legally engage in investment advisory business. The Consent Order also found that respondents engaged in the business of providing investment advisory services in North Carolina without being properly registered to do so under the North Carolina Investment Advisers Act. For more information, click here.

On December 2, 2014, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with Bankers Life and Casualty Company and BLC Financial Services, Inc., regarding its registrations and registrations of its representatives when entering into securities transactions with citizens of North Carolina. For more information, click here.

On November 05, 2014, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Order to Cease and Desist to Stark Innovations, L.L.C., and David Alan Topping, d/b/a “Stark Investments, Inc.”. Stark Innovations, L.L.C., and David Alan Topping, d/b/a “Stark Investments, Inc.” were ordered to cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities unless and until such securities have been registered and Stark Innovations, L.L.C., and David Alan Topping, d/b/a “Stark Investments, Inc.” become registered as a dealer or salesman of securities. The Temporary Order to Cease and Desist found that Stark Innovations, L.L.C., and David Alan Topping, d/b/a “Stark Investments, Inc.” offered for sale as investment opportunities certain securities in the form of promissory notes, whereby investors could expect an interest return based on increased revenue generated from international trade; and that this activity violated the North Carolina Securities Act. The Temporary Order to Cease and Desist gives Respondents 30 days in which to request a hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. For more information, click here.

On October 30, 2014, Sean Fitzgerald Mescall was sentenced in U.S. District Court to 195 months in prison, and ordered to pay $1,248,812.09 as restitution to his victims (press release). Records show that from 2006 to 2010 Mescall executed a Ponzi scheme by inducing over 119 investors in Charlotte and elsewhere to invest more than $1.5 million in his investment company, Capitalstreet Financial, LLC (CSF), falsely representing that their money would be invested in the foreign currency market (FOREX). Mescall lied to his victims about his professional background and credentials, and about the nature of CSF. Investors were promised investors 60-80% annual returns, but instead Mescall used a substantial amount of investor money to pay for personal expenses unrelated to any foreign exchange. Most of the victims were elderly and the funds they invested were most, if not all, of their life savings. For more information, please see the the entries at December 23, 2009 and September 8, 2009 below.

On September 23, 2014, former NFL football player Jimmy Hitchcock was sentenced to serve 46 months in federal prison, to be followed by two years of supervised release, for his role in a multi-million mortgage fraud conspiracy codenamed “Operation Wax House” (press release). Hitchcock, of Clemmons, NC, pleaded guilty in June 2013 to one count of mortgage fraud conspiracy, one count of bank bribery conspiracy and one count of money laundering conspiracy. In sentencing Hitchcock yesterday, Chief U.S. District Judge Frank D. Whitney found that Hitchcock was the leader or organizer of this mortgage fraud conspiracy and further that Hitchcock had engaged in a sophisticated scheme by, among other things, creating bogus “official checks” that could be used to make it appear as if buyers had made down payments when in fact they had not. According to court documents, Hitchcock created other false documents to support the mortgage fraud transactions and recruited a bank insider to assist in the fraud, by paying her bribes to provide bogus verifications of deposit to support the mortgage fraud transactions. According to information presented at the sentencing hearing, the losses incurred by financial and lending institutions associated with the mortgage fraud transactions that Hitchcock participated in were approximately $4.5 million. Additionally, Hitchcock personally received more than $500,000 from the loan proceeds fraudulently obtained by the conspiracy during the sixteen months it operated. For additional information, see the entries at September 3, 2015, May 29, 2015, February 18, 2015, January 27, 2015, June 26, 2014, October 23, 2013, July 10, 2013, and April 24, 2013, respectively.

On July 24, 2014, Claude Darrell McDougal, 55, formerly of Charlotte, pleaded guilty before a US magistrate to securities fraud for orchestrating a Ponzi scheme that defrauded his investor victims of over $2.5 million dollars. McDougal admitted in court that he used approximately $1.19 million of the investors’ funds to support his own lifestyle, including to buy dinners, jewelry and electronics, and to pay for hotel stays, furniture and other business-related expenses. According to court documents and today’s plea hearing, from 2006 to 2010 McDougal induced over 25 investors in Charlotte and elsewhere to invest more than $2.5 million, by promising his victims their money would be invested in securities, in the form of promissory notes offered by US Financial Alliance Consultants, LLC (Financial Alliance). McDougal created Charlotte-based Financial Alliance in 2005, but his company was never registered as a dealer of securities in North Carolina or elsewhere, court records reflect. Also, according to court records, McDougal was not registered to sell securities in North Carolina or in any other state, following termination from his previous employer in August 2009. For more information about today's pleading, see this press release. For information about his sentencing, see the entry at July 23, 2015 above.

On June 26, 2014, a federal jury convicted Steven Jones, of Waxhaw, NC, in connection with his involvement in the $75 million racketeering conspiracy codenamed “Operation Wax House” (press release). According to trial evidence, Jones was a promoter in the enterprise’s investment fraud operations, bringing in multiple investors, including an attorney, who Jones and his co-conspirators defrauded out of $3.7 million. Trial evidence established that throughout a seven year period the enterprise created a series of sham corporations to convince individuals to invest money. When investors would become aware of the problems with one corporation the enterprise would start a new corporation with new officers on paper to continue to defraud still further investors, court records show. Trial evidence also showed that Jones and others defrauded victims not of just money they had, but also caused the victims to take out expensive loans and to invest those loan proceeds based on false promises. According to evidence presented at trial, Jones and his co-conspirators used the investors’ money for personal expenditures, including private jets, high profile offices, entertaining themselves and others, and supporting their luxurious lifestyles. In total, the enterprise’s investment fraud operations took approximately $48 million from investors. For additional information, see the entries at May 29, 2015, September 3, 2015, February 18, 2015, January 27, 2015, September 23, 2014, October 23, 2013 and July 10, 2013, respectively.

On June 18, 2014, the Securities Division of the North Carolina Department of the Secretary of State and Goldman, Sachs & Co., reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On June 17, 2014, the Securities Division of the North Carolina Department of the Secretary of State and JPMorgan Chase & Co., reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On May 21, 2014, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Respondents, issued a Final Consent Order against Respondents Empowered Investor Incorporated, James Daryl Upham, and Thomas Cowart Goolsby, based on findings of violations of the North Carolina Investment Advisers Act by the Respondents in soliciting advisory clients and in the management of their advisory clients’ accounts. The Final Order revokes the investment adviser registration of Empowered Investor Incorporated, and the registrations as investment adviser representatives of Upham and Goolsby. The Respondents are ordered to cease and desist from engaging in the securities or financial services business and from transacting any business as an investment adviser, investment adviser representative, or securities dealer or salesman. In addition, the Order prohibits Respondents for ten years from seeking registration as an investment adviser or investment adviser representative pursuant to N.C.G.S. Chapter 78C or as a dealer or salesman pursuant to N.C.G.S. Chapter 78A. For more information, click here.

On April 11, 2014, the Securities Division of the North Carolina Department of the Secretary of State and Morgan Stanley & Co. LLC, reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On October 27, 2013, Rondell Scott Hedrick of Lexington, NC, was charged by Law Enforcement agents with the North Carolina Secretary of State Division of Securities with 27 felony counts related to an alleged precious metals investment scam. Investigators alleged Hedrick deceived multiple victims from around the country into sending him money that he claimed he was using to buy gold overseas and then re-sell for huge profits within a matter of days. Hedrick used the Internet website Craigslist stating that the victims would be repaid within a short time for up to triple what they invested with him. Hedrick was not registered to sell financial securities during the alleged incidents, and his company was shown on the Secretary of State website to be not in good standing. For more information, please see this press release. He was convicted on October 27, 2014, in the US District Court for the Middle District of Florida. For more information, please see this press release. See also the February 4, 2013, entry below and the entry at November 20, 2012.

On October 23, 2013, a federal jury convicted a real estate agent and a loan processor on all charges relating to a $75 million racketeering conspiracy codenamed ”Operation Wax House” (press release). Today’s convictions are the latest in Operation Wax House, an investigation which began in 2007 and has netted 91 defendants to date, 80 of which have pleaded guilty or have been convicted following a trial. Nathan Shane Wolf, of Charlotte, NC, a licensed real estate agent in North Carolina, was convicted of all three charges against him in the indictment: Racketeering Conspiracy, Bank Fraud, and Money Laundering Conspiracy. Denetria Montresa Myles, of Charlotte, NC, a loan processor and licensed notary public in North Carolina, was also convicted of all charges against her in the indictment: Racketeering Conspiracy, and Bank Fraud. For additional information, see the entries at September 3, 2015, May 29, 2015, February 18, 2015, January 27, 2015, September 23, 2014, June 26, 2014, July 10, 2013, and April 24, 2013, respectively.

On October 22, 2013, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Order to Cease and Desist to VASQUEZ GLOBAL INVESTMENTS, LLC and EDWIN A. VASQUEZ. VASQUEZ GLOBAL INVESTMENTS, LLC and EDWIN A. VASQUEZ were ordered to cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities unless and until such securities have been registered and VASQUEZ GLOBAL INVESTMENTS, LLC and EDWIN A. VASQUEZ become registered as a dealer or salesman of securities. The Temporary Order to Cease and Desist found that VASQUEZ GLOBAL INVESTMENTS, LLC and EDWIN A. VASQUEZ offered and sold debt instruments in transactions involving an investment enterprise that alleged to trade in futures contracts and commodities, which violated the North Carolina Securities Act. The Temporary Order to Cease and Desist gives Respondents 30 days in which to request a hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. For more information, click here.

On September 6, 2013, the Securities Division of the North Carolina Department of the Secretary of State issued a Final Order to Cease and Desist to respondents, Ballantyne Wealth Advisors, LLC, Ballantyne Wealth Management Group, LLC, and Ronald J. Walters. The Final Order to Cease and Desist made final the Temporary Order to Cease and Desist issued and entered by the Division on June 21, 2013, ordering each respondent to cease and desist from transacting business in the State of North Carolina as investment advisers and investment adviser representative in violation of the North Carolina Investment Advisers Act. The Temporary Order to Cease and Desist found that respondents were engaged in the business of providing investment advisory services in North Carolina without being properly registered to do so under the North Carolina Investment Advisers Act. Additionally, respondents continued to hold themselves out as registered investment adviser and investment adviser representative in violation of the anti-fraud provisions of the North Carolina Investment Advisers Act. The Temporary Order to Cease and Desist gave Ballantyne Wealth Advisors, LLC, Ballantyne Wealth Management Group, LLC, and Ronald J. Walters 30 days in which to request a hearing. Respondents failed to file such a request within the time allowed, causing the Temporary Order to Cease and Desist to become permanent and final. For more information, click here.

On July 11, 2013, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Respondents, issued a Final Order against Fraser Landmark, LLC, d/b/a Fraser Advisorsas successor in registration to Fraser Management Associates, LLC, a/k/a FMA, LLC ("Fraser"), William Alexander Seagle, and Leonard David Davenport. The Final Order ordered that the registration of Fraser be restricted and limited as described in the Final Order. The Final Order also ordered that the applications of Mr. Seagle and Mr. Davenport for registration as investment advisers representatives under Chapter 78C be granted, subject to the restrictions and limitations described in the Final Order. The Final Order found that, from February 2006 through present, Fraser had: (a) transacted business in this State as an investment adviser by, among others, providing investment advice for compensation; and (b) neither submitted a notice filing with the Administrator under Chapter 78C between 2006 and 2012 when it was an investment adviser covered under federal law, nor registered itself, for the period of 28 June 2012 through 10 December 2012, with the Administrator as an investment adviser under Chapter 78C. The Final Order also found that, from February 2006 through present, Mr. Seagle and Mr. Davenport had transacted business in this State as investment adviser representatives of Fraser, and during such period neither person was registered as an investment adviser representative under Chapter 78C. For more information, click here.

On July 10, 2013, Michelle V. Mallard (a/k/a Michelle Crawford), a former lawyer from Charlotte, NC, pleaded guilty to mortgage fraud conspiracy, money laundering conspiracy and embezzlement in violation of the wire fraud statute as part of the $75 million racketeering conspiracy codenamed ”Operation Wax House” (press release). Mallard’s guilty plea is the latest conviction in Operation Wax House, which began in 2007 and has netted 91 defendants to date, 72 of which have pleaded guilty. Mallard was charged with embezzlement and with serving as a mortgage fraud lawyer for a mortgage fraud cell in the Operation Wax House investigation. According to evidence introduced at trial, Mallard agreed to use her law license to further mortgage fraud primarily in South Charlotte and Waxhaw, NC. According to trial testimony, the co-conspirators purchased houses at inflated prices in exchange for large kickbacks representing the difference between the true price and the inflated price. Trial witnesses testified that Mallard agreed to pay such kickbacks to other members of the conspiracy and, among other things, accepted bogus checks to make it appear as though buyers had provided money when they had not. According to trial evidence and statements made by the prosecutors, Mallard participated in the mortgage fraud after having stolen over $30,000 from clients by embezzling from her trust account. For additional information, see the entries at September 3, 2015, May 29, 2015, February 18, 2015, January 27, 2015, September 23, 2014, June 26, 2014, October 23, 2013, and April 24, 2013, respectively.

On June 21, 2013, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Order to Cease and Desist to respondents, Ballantyne Wealth Advisors, LLC, Ballantyne Wealth Management Group, LLC, and Ronald J. Walters. The Temporary Order to Cease and Desist ordered each respondent to immediately cease and desist from transacting business in the State of North Carolina as investment advisers and investment adviser representative in violation of the North Carolina Investment Advisers Act. The Temporary Cease and Desist found that respondents were engaged in the business of providing investment advisory services in North Carolina without being properly registered to do so under the North Carolina Investment Advisers Act. Additionally, respondents continued to hold themselves out as registered investment adviser and investment adviser representative in violation of the anti-fraud provisions of the North Carolina Investment Advisers Act. The Temporary Order to Cease and Desist gives Ballantyne Wealth Advisors, LLC, Ballantyne Wealth Management Group, LLC, and Ronald J. Walters 30 days in which to request a hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. For more information, click here.

On May 23, 2013, Stephen E. Maiden, of Charlotte, pleaded guilty before a U.S. Magistrate Judge to securities fraud for carrying out an $8.9 million Ponzi scheme (see press release). A criminal bill of information filed on February 21, 2013, charged Maiden with conducting a Ponzi scheme through his hedge fund Maiden Capital Opportunity Fund (Maiden Capital) which was based in Charlotte. According to the bill of information, Maiden formed his hedge fund in October 2006 and touted his past educational and professional experience, which included stints at Chase Securities, Inc. as an investment banker and Mangan & McColl Partners as an investment analyst, to attract investors from Charlotte and elsewhere. Based on information in court documents and court proceedings, beginning in at least February 2009, Maiden routinely transmitted bogus account statements to victims and to Maiden Capital’s fund administrator which falsely reported favorable returns both monthly and from the fund’s inception. In truth and fact, according to the charging document, Maiden completely fabricated these returns and by February 2009 had lost the majority of the fund’s assets in failed investments. To keep the scheme going, Maiden used money from new investors to satisfy withdrawal requests made by other fund investors, falsely characterizing the transactions as payments from Maiden Capital’s successful operations. As a result of his conduct, Maiden caused a total loss to victims of at least $8.9 million. Maiden pleaded guilty to one count of securities fraud and was released on bond. For sentencing information, see the entry at February 11, 2015 above, and the corresponding press release.

On May 14, 2013, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Respondents, issued a Final Order against Pliny Arenas and Salem Vision Ventures, LLC, a former North Carolina limited liability company. The Final Order ordered that Pliny Arenas and Salem Vision Ventures, LLC cease and desist from offering to sell or selling securities of any kind including, but not limited to, investment contracts or membership interests in a limited liability company such as Respondent Salem Vision Ventures, LLC. The Final Order found that neither Pliny Arenas nor Salem Vision Ventures, LLC was registered to offer or sell securities in North Carolina, in violation of the North Carolina Securities Act. For more information, click here.

On April 24, 2013, a federal superseding indictment unsealed in U.S. District Court charged nine additional defendants in Charlotte and elsewhere with racketeering, investment fraud, mortgage fraud, bank bribery and money laundering (press release). This latest round of criminal charges resulting from "Operation Wax House", a mortgage fraud investigation which began in the Western District of North Carolina in 2007, brings the total number of defendants charged to date to 92, of which 66 have pleaded guilty. According to allegations contained in the unsealed indictment, the Enterprise, which operated from about 2005 through 2012, engaged in an extensive pattern of racketeering activities, consisting of investment fraud, mortgage fraud, bank fraud, money laundering and distribution of illegal drugs. Members of the Enterprise also bribed bank officials. In the investment fraud portion of the racketeering activities, the co-conspirators targeted professional athletes and doctors as well as their personal and professional acquaintances and convinced them to invest in a series of sham corporations controlled by the Enterprise. For example, members of the Enterprise told potential investors that one of the sham corporations, PEI, was a commodities trading company that would broker deals for the supposed export-import of various commodities like rice-trading and gold and diamond mining in Africa. In truth and fact, instead of investing the victims’ money as promised, the Enterprise used the funds obtained through PEI to support its members’ lifestyles and to make Ponzi-style payments to other victims. The co-conspirators stole over $27 million from more than 50 investor victims, including monies that the investor victims were induced to obtain as loans from financial institutions. Defendants added in this superseding indictment are:

• William Brown, of Matthews, NC;
• Benjamin Clarke, of Smyrna, GA;
• Frank DeSimone, of Charlotte, NC;
• Lorie Dooley, of Washington, DC:
• James E. Fink, of Waxhaw, NC:
• Ralph Johnson, of Charlotte, NC;
• Denetria Myles, of Charlotte, NC;
• Matthew Newland, of Coralville, IA;
• Nazeere Saddig, formerly of Charlotte, NC.

On April 18, 2013, James H. Mason of Graham, NC was charged with one count of securities fraud for orchestrating a $4.7 million Ponzi scheme that solicited victims to invest millions in the foreign currency market (“FOREX”). According to allegations contained in the indictment, beginning in 2010 and continuing through March 28, 2013, Mason executed the Ponzi scheme by inducing victims to invest with his investment companies, JHM Forex Only Pool and Forex Trading at Home Association, and other related entities, for the supposed purpose of investing in Over-the-Counter (“OTC”) foreign currency exchange. For more information, please see this press release. Mason pleaded guilty in June 2014 and was sentenced by the US District Court for the Western District of North Carolina to 96 months in prison on August 3, 2015. He was also ordered to serve three years under court supervision and to pay $4,325,820.79 as restitution to the victims of his fraud. For more information, please see this press release. See also the entries for March 27, 2013 below and August 3, 2015 above.

On March 27, 2013, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Order to Cease and Desist to, respondents, James Harvey Mason, The JHM Forex Only Pool (f/k/a The JHM Forex Only Pool, LP), and Forex Trading at Home (d/b/a “FTAH Partners”). The Temporary Order to Cease and Desist ordered each respondent, and any agent thereof, to immediately cease and desist offering for sale, soliciting offers to purchase, or selling, any security of any issuer, howsoever denominated, including but not limited to the securities of respondents or other entities under their control, unless and until any such: (a) Securities have been registered under the provisions of the Securities Act; and (b) Respondent, and any person or entity under the direction or control of any such respondent, is properly registered as a securities dealer or salesman under the provisions of the North Carolina Securities Act. The Temporary Order to Cease and Desist found that respondents offered investment contracts in the form of an investment program whereby investors’ money was pooled and used to trade off-exchange foreign currencies. The Temporary Order to Cease and Desist gives James Harvey Mason, The JHM Forex Only Pool (f/k/a The JHM Forex Only Pool, LP), and Forex Trading at Home (d/b/a “FTAH Partners”) 30 days in which to request a hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. See also the entries for April 18, 2013 and August 3, 2015 above. For more information, click here.

On February 27, 2013, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Order to Cease and Desist to Roman Novak, Radoslav Novak, and Inter Reef LTD d/b/a Profitable Sunrise. Roman Novak, Radoslav Novak, and Inter Reef LTD d/b/a Profitable Sunrise were ordered to cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities unless and until such securities have been registered and Roman Novak, Radoslav Novak, and Inter Reef LTD d/b/a Profitable Sunrise become registered as dealers or salesmen of securities. The Temporary Order to Cease and Desist found that Roman Novak, Radoslav Novak, and Inter Reef LTD d/b/a Profitable Sunrise offered investment contracts in the form of investment plans, made available through their website http://www.profitablesunrise.com, in violation of the North Carolina Securities Act. The Temporary Order to Cease and Desist gives Respondents 30 days in which to request a hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. For more information, click here.

On February 4, 2013, the Securities Division of the North Carolina Department of the Secretary of State issued a Final Order to Cease and Desist against Hedrick Consulting, Incorporated and Rondell Scott Hedrick. The Final Order to Cease and Desist permanently ordered that Respondents shall cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities, including but not limited to the securities of Hedrick Consulting, Incorporated. The Final Order to Cease and Desist found that Hedrick Consulting, Incorporated and Rondell Scott Hedrick are in violation of N.C.G.S. §§78A-24 and 78A-36. See also the entries at October 27, 2013 and November 20, 2012. For more information, click here.

On January 17, 2013, Mitchell Brian Huffman of Charlotte, NC, was sentenced to serve 60 months in prison, followed by three years of supervised release. He was also ordered to pay a $2.1 million civil monetary penalty. From 2006 through 2011, Huffman raised approximately $3.2 million dollars from his victims by falsely claiming that he was generating annual rates of return 100% to 150% using his proprietary trading program to trade in the commodities futures market. Huffman directed his victims to transfer their funds to his personal bank account. Of the $3.2 million Huffman fraudulently obtained, he utilized only a little over 50% to engage in trading activities. He generated bogus monthly statements to his victims which falsely reflected fictitious profits from trading activities, when in fact massive losses were sustained. During this time, Huffman also made Ponzi payments of approximately $834,160 to victim investors, falsely representing that these payments were profits from trading activity. Finally, Huffman also used the victims’ funds, without their knowledge or consent, for personal expenses including vehicles, luxurious vacations, and to make charitable contributions in his name. See his sentencing press release. For more information, please see the February 17, 2012 press release from the Commodity Futures Trading Commission.

On January 17, 2013, Robert S. Moss of Charlotte, NC, was sentenced in U.S. District Court for the Western District of North Carolina to 57 months in prison followed by three years of supervised release, and was also ordered to pay $1,460,121 as restitution. From about 2001 through about February 2009, Moss solicited investments totaling approximately $3.1 million from victims nationwide. Moss lured his victims by falsely claiming that he was generating substantial profits through options trading in the commodities futures market. Moss told his victims that he had generated annual returns of between 22% and 41%, and that none of his investors had ever lost any capital. In fact, between 2003 and 2009, Moss suffered losses of $342,264 in the commodities futures market. Moss also advised the victims that his liquid assets were more than three times the size of his trading account when in fact they were not. To conceal his scheme, Moss made Ponzi payments to his victims totaling $1.6 million and falsely represented that these payments were the result of successful trading profits. In addition, Moss unlawfully used money invested by the victims for personal expenditures such as mortgage payments, groceries, and other household expenses. Moss pleaded guilty in September 2011, to one count of commodities fraud for engaging in a $1.5 million Ponzi scheme. See his sentencing press release. In earlier action, on July 13, 2011, the U.S. Commodity Futures Trading Commission (CFTC) filed and simultaneously settled charges that Moss fraudulently solicited more than $3 million from 22 individuals to trade options on commodity futures through a commodity pool. Moss had never been registered with the CFTC. For more information, click here.

On November 28, 2012, the Securities Division of the North Carolina Department of the Secretary of State and Merrill Lynch, Pierce, Fenner & Smith Incorporated, reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On November 20, 2012, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Order to Cease and Desist to Rondell Scott Hedrick and Hedrick Consulting, Incorporated. Rondell Scott Hedrick and Hedrick Consulting, Incorporated were ordered to cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities unless and until such securities have been registered and Rondell Scott Hedrick and Hedrick Consulting, Incorporated become registered as a dealer or salesman of securities. The Temporary Order to Cease and Desist found that Rondell Scott Hedrick and Hedrick Consulting, Incorporated offered and sold investment contracts in transactions involving the purchase and sale of gold bars, in violation of the North Carolina Securities Act. The Temporary Order to Cease and Desist gives Respondents 30 days in which to request a hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. See also the entries at October 27, 2013 and February 2, 2013. For more information, click here.

On September 4, 2012, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into a Final Order By Consent with Morgan Asset Management, Inc. and Morgan Keegan & Company, Inc., regarding its dishonest and unethical practices in the marketing and sale of certain funds to citizens of North Carolina. For more information, click here.

On August 17, 2012, Michael Anthony Jenkins was served by law enforcement agents with the North Carolina Secretary of State Division of Securities on three felony arrest warrants for securities fraud. Secretary of State Securities Investigators allege that Jenkins told investors he would use their funds to trade commodities futures or “E-mini futures” through his company, Harbor Light Asset Management, LLC. Investigators allege Jenkins instead converted funds to his personal use and used money from later investors to pay earlier investors, in what is commonly referred to as a “Ponzi Scheme.” Jenkins also was never registered with the NC Secretary of State’s Office to sell securities, or with the National Futures Association to act as a commodities trader. For more information, see our press release. For more information, see the entry at May 26, 2015 above.

On August 2, 2012, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Respondents, issued a Final Order against Edward D. Nowell and South Atlantic Capital Management Group, Inc. The Final Order ordered that each Respondent cease and desist from violating the registration requirements of Chapter 78C. The Final Order found, after an examination pursuant to N.C.G.S. § 18(e), that for a period of at least three years each Respondent conducted business as a person required to be registered under Chapter 78C while each Respondent was not registered thereunder. For more information, click here.

On May 23, 2012, Keith Franklin Simmons, of West Jefferson, North Carolina, was sentenced in US District Court to 50 years in prison in connection with a $40 million Ponzi scheme he operated. He was also ordered to serve three years under court supervision following his prison term and to pay $35,331,632 in restitution (see press release). In December 2009, Simmons was arrested by the FBI and detained without bond. In August 2010, a superseding bill of indictment charged Simmons with one count of securities fraud, one count of wire fraud, and two counts of money laundering. In December 2010, Simmons was convicted on all four counts by federal jury. According to filed court documents, court proceedings, and today’s sentencing hearing, beginning in April 2007, Simmons began soliciting victims to invest in Black Diamond for supposed trading in the foreign currency exchange market. From April 2007 through September 2009, Simmons and his co-conspirators induced over 400 victims nationwide to invest more than $40 million in Black Diamond through a series of false representations, including bogus claims that Black Diamond was generating profits of more than 48 percent annually in the foreign currency trading market. In reality, none of the representations Simmons made to his victims were true. Simmons never invested the funds in any foreign currency market. Rather, court records indicate, Simmons used his victims’ money to fund a lavish lifestyle. For additional information, see the October 24, 2011 entry below regarding Bryan Keith Coats and the corresponding press release.

On May 9, 2012, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of the respondent, issued a Final Order against BCG Securities, Inc., a Pennsylvania corporation. First, the Final Order ordered that BCG Securities, Inc. cease and desist from transacting into or from North Carolina: (a) securities business as a securities dealer, along with its securities salesmen, unless registered; and (b) business as an investment adviser unless registered. Second, the Final Order ordered that BCG Securities, Inc. cease and desist employing or utilizing, or both, associated securities salesmen who effect or attempt to effect securities transactions while such salesmen are not registered with the Securities Division. Third, the Final Order ordered that BCG Securities, Inc.cease and desist in failing to reasonably supervise its ecurities salesmen and in violating the registration and notice filing procedures for investment advisers. Fourth, the Final Order ordered that BCG Securities, Inc. take remedial steps including establishing and maintaining trade monitoring systems. The Final Order found that BCG Securities, Inc.: (a) transacted into or from North Carolina business as a securities dealer, along with its securities salesmen, while neither were registered with the Securities Division; (b) employed or utilized securities salesmen, whom effected or attempted to effect securities transactions into or from North Carolina, while such salesmen were not registered; (c) did not follow its internal standards pursuant to its written supervisory procedures; and (d) did not make a notice filing with the Securities Division as required by the North Carolina Investment Advisers Act (N.C.G.S. Chapter 78C). For more information, click here.

On March 29, 2012, the Securities Division of the North Carolina Department of the Secretary of State issued a Final Order to Cease and Desist against Ephren W. Taylor, City Capital Corporation, City Laundry Services, LLC, City Petroleum, LLC, and Clean Sweeps Holdings Group, LLC. The Final Order to Cease and Desist permanently ordered that Respondents shall cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities, including but not limited to the securities of City Capital Corporation, City Laundry Services, LLC, City Petroleum, LLC, and Clean Sweeps Holdings Group, LLC. The Final Order to Cease and Desist finds that Ephren W. Taylor was not licensed to sell securities in North Carolina and City Capital Corporation, City Laundry Services, LLC, City Petroleum, LLC, and Clean Sweeps Holdings Group, LLCemployed unlicensed salespersons to offer and sell their securities, in violation of the North Carolina Securities Act. The Final Order to Cease and Desist also permanently ordered Respondents to cease and desist from making untrue statements of a material fact and omitting to state material facts in connection with the offer, sale or purchase of any security. For more information, click here.

On March 6, 2012, the Securities Division of the North Carolina Department of the Secretary of State issued a Final Order to Cease and Desist against Joseph Maurice Deberry and Sweetwater Capital Management, LLC, a limited liability company formed in North Carolina. The Final Order to Cease and Desist permanently ordered that Respondents shall cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities, including but not limited to investment contracts in the construction of student housing at privately owned colleges, in violation of the North Carolina Securities Act. The Final Order to Cease and Desist finds that Joseph Maurice Deberry was not licensed to sell securities in North Carolina and Sweetwater Capital Management, LLC employed an unlicensed salesman to offer and sell its securities, in violation of the North Carolina Securities Act. The Final Order to Cease and Desist also permanently ordered Respondents to cease and desist from making untrue statements of a material fact and omitting to state material facts in connection with the offer, sale or purchase of any security. Deberry later pleaded guilty to wire fraud. For more information, see the entry at June 11, 2020 above (press release). For more information, click here.

On February 10, 2012, the Securities Division of the North Carolina Department of the Secretary of State and UBS Securities LLC and UBS Financial Services Inc., reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On February 8, 2012, Gary D. Martin, of St. Augustine, FL, pleaded guilty in federal court to conducting a money laundering conspiracy in connection with the $32.5 million Queen Shoals Ponzi scheme. (See also the , entry for Sidney S. Hanson). Martin induced victims to invest in the scheme through a series of false and fraudulent representations, omissions of material facts, and deceptive half truths. Specifically, Martin falsely claimed that Queen Shoals Consultants, LLC (QSC) had over 20 years experience in financial services and international finance and that he had a vast background in financial services, including the silver, gold and foreign currency trading markets. In truth, Martin had no such experience, held no professional licenses related to finance or investments, and never had engaged in any silver, gold or foreign currency trading. Martin had also claimed that he invested his retirement life savings in Queen Shoals. In fact, Martin personally invested only $4,000 while QSC funneled victim funds solely into the Queen Shoals Ponzi scheme (press release). On March 12, 2013, Martin was sentenced to 10 years in prison and was ordered to pay $31,707,038 as restitution to the victims of the scheme (press release). In earlier action, on March 17, 2011, Martin, his wife Brenda K. Martin and their company, Queen Shoals Consultants, LLC, were charged by the US Commodities Futures Trading Commission (CFTC) with defrauding customers of more than $1.44 million through a retail foreign currency (forex) trading scheme (press release).

On January 19, 2012, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into an Administrative Order with Merrill Lynch, Pierce, Fenner & Smith Incorporated, regarding its supervisory system with respect to the registrations of its Client Associates when entering into securities transactions with citizens of North Carolina. For more information, click here.

On January 17, 2012, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Frank S. Sparger, issued a Final Order re-instating the securities salesman and investment adviser representative registrations of Mr. Sparger, and restricting those registrations for a period of three years. Mr. Sparger’s registrations were summarily suspended by the Division in connection with events that caused FINRA to impose a suspension of his FINRA membership. The underlying events took place some years ago at a now defunct brokerage firm. Mr. Sparger cooperated with FINRA and the Division in their separate proceedings For more information, click here.

On January 3, 2012, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Order to Cease and Desist to Joseph Maurice DeBerry and Sweetwater Capital Management, LLC. Joseph Maurice DeBerry and Sweetwater Capital Management, LLC were ordered to cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities unless and until such securities have been registered and Joseph Maurice DeBerry and Sweetwater Capital Management, LLC become registered as a dealer or salesman of securities. The Temporary Order to Cease and Desist found that Joseph Maurice DeBerry and Sweetwater Capital Management, LLC offered and sold investment contracts in the construction of student housing at privately owned colleges in violation of the North Carolina Securities Act. Joseph Maurice DeBerry and Sweetwater Capital Management, LLC were also ordered to cease and desist from making untrue statements of a material fact and omissions of material facts in connection with the offer, sale or purchase of any security. The Temporary Order to Cease and Desist gives Respondents 30 days in which to request a hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. For more information, click here.

On November 30, 2011, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Order to Cease and Desist to Ephren W. Taylor, City Capital Corporation, City Laundry Services, LLC, City Petroleum, LLC, and Clean Sweeps Holdings Group, LLC. Respondents were ordered to cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, any securities unless and until such securities have been registered and Ephren W. Taylor, City Capital Corporation, City Laundry Services, LLC, City Petroleum, LLC, and Clean Sweeps Holdings Group, LLC become registered as a dealer or salesman of securities. The Temporary Order to Cease and Desist found that Ephren W. Taylor and City Capital Corporation offered and sold investment contracts in the enterprise of purchasing, rehabilitating and selling of homes. Additionally, the Temporary Order to Cease and Desist found that Ephren W. Taylor, City Capital Corporation, City Laundry Services, LLC and City Petroleum, LLC offered and sold promissory notes to investors to be placed in self-directed IRA accounts with City Capital Corporation at The Equity Trust Company. Finally, the Temporary Order to Cease and Desist found that Ephren W. Taylor and Clean Sweeps Holdings Group, LLC offered and sold investment contracts in the enterprise of investing in a sweepstakes machine. Respondents were also ordered to cease and desist from making untrue statements of a material fact and omissions of material facts in connection with the offer, sale or purchase of any security. The Temporary Order to Cease and Desist gives Respondents 30 days in which to request a hearing. If no such request is made during that time, the Temporary Order to Cease and Desist shall become final. For more information, click here.

On November 3, 2011, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of the respondents, issued a Final Order against Capital Management Partners, LLC, The North Carolina Center for Retirement and Estate Planning, LLC, and Kevin Edward Sullivan. It was ordered and agreed that the applications of Capital Management Partners, LLC and Kevin Edward Sullivan were denied. It was also ordered and agreed that respondents would not apply with the Securities Division again before July 11, 2014. Respondents were also ordered to cease and desist from violating any statute, rule or regulation under the NC Securities Act or Investment Advisers Act. For more information, click here.

On October 24, 2011, Bryan Keith Coats of Clayton, NC, pled guilty to his role in a $40 million Ponzi scheme. Coats pled guilty before a U.S. Magistrate Judge to one count of conspiracy to commit commodities, securities, and wire fraud and one count of promotional money laundering conspiracy (see press release). On November 16, 2012, Coats was sentenced to 15 years in prison (see press release). From October 2007 to December 2009, Coats recruited several individuals who served as so called “hedge fund managers” in the Black Diamond Ponzi scheme. Coats and these hedge fund managers engaged in a conspiracy to induce victims to invest in Black Diamond by making a series of false and fraudulent representations, material omissions, and deceptive half truths. Coats and others falsely represented to victims that they had conducted due diligence on Black Diamond in selecting Black Diamond as an investment vehicle. In reality, Coats and his conspirators knew little about Black Diamond, had done no true due diligence, and their so-called hedge funds had no true safeguards to ensure that the victims’ money was being invested legitimately. In addition, Coats and others did not inform investor victims that, at best, the true cost of investing in Black Diamond amounted to over eighty percent (80%) of Black Diamond’s expected profits. Also, once the Black Diamond Ponzi scheme began to collapse, Coats and his conspirators engaged in their own derivative Ponzi scheme in order to perpetuate their fraud. Beginning in March 2009, Coats and others set up a series of cash accounts into which new victim funds were deposited. Rather than investing such funds with Black Diamond, Coats and others used the new investor funds to pay withdrawal requests from old investor victims and to support their own lifestyles. For additional information, see also the May 23, 2012 entry above for Keith Franklin Simmons and the corresponding press release.

On October 10, 2011, the Securities Division of the North Carolina Department of the Secretary of State issued a Final Order By Consent revoking the securities salesman registration of Charles Mark Hall, a resident of Johnston County. In May 2011, Mr. Hall entered a plea of guilty in the Superior Court of Johnston County to criminal charges of embezzlement arising from the conduct of his business as an insurance broker and a securities salesman prior to and during 2009. Mr. Hall was sentenced a term in state prison of at least 13 years. See also the entry at 9/11/2009. For more information, click here.

On September 27, 2011, the Securities Division of the North Carolina Department of the Secretary of State issued a Final Order to Cease and Desist against respondents Carolyn W. Grant and Omega Property Group, LLC. The Final Order to Cease and Desist permanently ordered that Respondents shall cease and desist from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, promissory notes or any other security unless and until such securities and Respondents have been registered under the Securities Act. The Final Order to Cease and Desist also permanently ordered Respondents from making untrue statements of a material fact in connection with the offer, sale or purchase of any security. For more information, click here.

On September 22, 2011, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Sherwood Randy Smith, a resident of Pitt County, and Consolidated Work Industries, Inc., a North Carolina corporation, issued a Final Order against Smith and Consolidated Work Industries, Inc. Smith and Consolidated Work Industries, Inc. were ordered to cease and desist from offering to sell or selling securities of any kind in the State of North Carolina, including, but not limited to, participation in the expected proceeds from the release of funds from any “off shore” account, promissory notes, stocks, or the securities offered by any other entity, to persons residing or located in the State of North Carolina, without first complying with the North Carolina Securities Act. The Final Order found that Smith and Consolidated Work Industries, Inc. were selling unregistered securities in violation of the North Carolina Securities Act. For more information, click here.

On September 19, 2011, the Securities Division of the North Carolina Department of the Secretary of State, issued a Final Order revoking the securities salesman and investment adviser registrations of Christopher B. Mintz, formerly a resident of Wake County. In 2009 Mr. Mintz entered a plea of guilty in the United States District Court for the Eastern District of North Carolina to a federal charge of fraud by an investment adviser and was sentenced to a term in federal prison. For more information, click here.

On August 4, 2011, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Order to Cease and Desist to Carolyn W. Grant and Omega Property Group, LLC. Carolyn W. Grant and Omega Property Group, LLC were ordered to cease and desist from offering for sale, soliciting offers to purchase, or selling in or from North Carolina, promissory notes or any other security unless and until such securities have been registered and Carolyn W. Grant and Omega Property Group, LLC become registered as a dealer or salesman of securities. Carolyn W. Grant and Omega Property Group, LLC were also ordered to cease and desist from making untrue statements of a material fact in connection with the offer, sale or purchase of any security. The Temporary Order gives respondents 30 days in which to request a hearing. If no such request is made during that time, the Temporary Order To Cease And Desist shall become final. For more information, click here.

On July 15, 2011, the NC Department of the Secretary of State announced that Dennis Todd Hagemann, of Raleigh, NC, pleaded guilty to 12 felony counts of securities fraud. He was sentenced to a minimum of 146-194 months in prison and was ordered to pay $911,000 restitution to his victims. Hagemann lured at least ten victims to invest $980,000 with his foreign currency (FOREX) hedge fund company, Yellowstone Partners, Inc., with promises of very high rates of return. He told at least one investor that he produced 100% returns each week. However, evidence showed that Hagemann was not successful in forex trading and never traded the investors’ funds as represented. Instead, he used investors’ money to pay back previous investors and converted investors’ funds to his personal use. For more information, please read our press release. On March 10, 2011, in a case brought by the US Commodity Futures Trading Commission (CFTC), the U.S. District Court for the Eastern District of North Carolina ordered Hagemann and his company to pay more than $1.6 million in restitution and civil monetary penalties for defrauding investors in a foreign currency (forex) Ponzi scheme (press release), crimes he was originally charged with on March 15, 2010 (press release). See additional information at the entry for March 10, 2010. For more information, click here.

On June 20, 2011, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Claude D. McDougal, a resident of Mecklenburg County, and US Financial Alliance Consultants, LLC, a North Carolina limited liability company, issued a Final Order against McDougal and US Financial Alliance Consultants, LLC. McDougal and US Financial Alliance Consultants, LLC were ordered to cease and desist from offering for sale, soliciting offers to purchase, or selling promissory notes or other securities in violation of the North Carolina Securities Act. The Final Order found that McDougal and US Financial Alliance Consultants, LLC were not licensed to sell securities and were selling unregistered securities, in violation of the North Carolina Securities Act. See also the 1/14/11 entry below. For more information, click here.

On June 14, 2011, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Jotham Walker Pruitt, a resident of Durham County, North Carolina; Cinchpoint, Inc. d/b/a Cinchpoint Financial Services, a North Carolina Corporation; and Ramses Capital Partners, LLC, a Delaware limited liability company; issued a Final Order in which the respective registrations of Mr. Pruitt and Cinchpoint, Inc. as an investment advisor representative and investment advisor were revoked. Mr. Pruitt, Cinchpoint, Inc. and Ramses Capital Partners, LLC were ordered to cease and desist from violating any statute, rule or regulation under the North Carolina Securities Act or Investment Advisers Act. The Final Order allows Mr. Pruitt to apply for registration as a securities salesman and/or investment adviser representative under supervision; however, Mr. Pruitt may not apply for registration as a principal of an investment advisor or securities dealer before March 2, 2014. For more information, click here.

On June 3, 2011, the Securities Division of the North Carolina Department of the Secretary of State issued a Final Order to Cease and Desist against Michael A. Smith, a resident of Castle Hayne, North Carolina. Smith was ordered to cease and desist from offering for sale, soliciting offers to purchase, or selling any securities, including securities of Carr Miller Capital, LLC, in violation of the North Carolina Securities Act. The Final Order found that Smith was not registered to sell securities in North Carolina and that Smith was selling unregistered securities of Carr Miller Capital, LLC, in violation of the North Carolina Securities Act. For more information, click here.

On May 12, 2011, the Securities Division of the North Carolina Department of the Secretary of State and Banc of America Securities LLC and Banc of America Investment Services, Inc., reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On March 31, 2011, Sidney S. Hanson of Charlotte, NC, was sentenced by the U.S. District Court for the Western District of North Carolina to 22 years in federal prison, to be followed by 3 years of supervised release, for his role in a $32.5 million Ponzi scheme that bilked investors, many of whom were elderly, by falsely promising investors yearly returns of up to 30 percent. The returns allegedly were to be generated by a diversified portfolio of treasury bills, precious metals, and foreign currency. Effected through his companies, Queen Shoals, LLC, Queen Shoals II, LLC, and Select Fund, LLC, his scam was crafted to appeal to the deeply held religious beliefs of his victims. For more information, please read the press release. On November 1, 2011, the same Court ordered Hanson and his companies to pay $24 million in restitution and civil monetary penalties (press release). Hanson originally pleaded guilty to charges of securities fraud, money laundering, and mail fraud on July 29, 2009 (see press release). (See also the 2/8/2012 entry for “Gary D. Martin”.)

On March 8, 2011, the Securities Division of the North Carolina Department of the Secretary of State and E*Trade Securities LLC, reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. The Final Consent Order was signed by Hearing Officer Sidney S. Eagles, Jr. For more information, click here.

On February 11, 2011, the Securities Division of the North Carolina Department of the Secretary of State, issued a Temporary Cease and Desist Order directing Michael A. Smith, a resident of Castle Hayne, North Carolina, and Carr Miller Capital, LLC, a New Jersey limited liability company, to cease and desist from offering to sell or selling securities, including but not limited to promissory notes, in violation of the North Carolina Securities Act. The temporary order finds that Carr Miller Capital and Smith sold unregistered promissory notes, that Carr Miller acted as an unregistered securities dealer, and that Smith acted as an unregistered salesman, in violation of the Securities Act. The temporary order directs the respondents to immediately cease and desist from such practices. For more information, click here.

On February 9, 2011, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Cease and Desist Order directing PMC Strategy, LLC, a limited liability company formed in North Carolina, and its directors, agents, and other persons in active concert and participation with PMC Strategy, LLC to cease and desist from offering to sell or selling unregistered securities, including but not limited to investments in the foreign currency market, in violation of the North Carolina Securities Act. The temporary order further finds that PMC Strategy, LLC was not licensed to sell securities in North Carolina in violation of the North Carolina Securities Act. The temporary order directs the respondents to immediately cease and desist from such practices. For more information, click here.

On January 14, 2011, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Cease and Desist Order directing Claude D. McDougal, a resident of Mecklenburg County, and US Financial Alliance Consultants, LLC, a North Carolina limited liability company, to cease and desist from offering to sell or selling securities, including but not limited to promissory notes, in violation of the North Carolina Securities Act. The temporary order finds that McDougal and US Financial Alliance Consultants, LLC were not licensed to sell securities and were selling unregistered securities, in violation of the North Carolina Securities Act. The Order directs McDougal and US Financial Alliance Consultants, LLC to immediately cease and desist from such practices. McDougaland US Financial Alliance Consultants, LLC have requested a hearing in this matter. See also the entry at 6/20/11 above. For more information, click here.

On October 22, 2010, the Securities Division of the North Carolina Department of the Secretary of State summarily suspended Aspire Private Capital, L.L.C. and John Bryan Philpott from transacting business as a Registered Investment Adviser and Investment Adviser representative, respectively. On November 19, 2010, the Securities Division, with the consent of Aspire Private Capital and Mr. Philpott, issued a Final Order resolving the summary suspension. Aspire Private Capital and Mr. Philpott were ordered to file an amended Form ADV, pay $250.00 in settlement of the securities investigation, and to cease and desist from violating any statute, rule, or regulation promulgated under the North Carolina Investment Advisers Act. For more information, click here.

On March 24, 2010, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Aspire Wealth Management, Inc, a North Carolina corporation, John Bryan Philpott a resident of Mecklenburg County, North Carolina, and Todd Andrew Witt a resident of Mecklenburg County, North Carolina, issued a Final Order in which Aspire, Mr. Philpott and Mr. Wittwere ordered to cease and desist from transacting business in this State as a dealer or salesman in violation of the North Carolina Securities Act; and further ordered to cease and desist from transacting business in this State as investment advisers/investment adviser representatives in violation of the North Carolina Investment Advisers Act. For more information, click here.

On March 10, 2010, Dennis Todd Hagemann of Raleigh, NC, was arrested by law enforcement agents from the North Carolina Secretary of State Division of Securities on charges that he defrauded a victim out of $50,000 in a foreign currency trading scam. Hagemann was arrested on two felony counts of securities fraud and one felony count of obtaining property by false pretense following a state investigation into alleged actions by Hagemann through his currency trading company, Yellowstone Partners, Inc. For more information, see press release. In other action, the US Commodities Futures Trading Commission (CFTC) charged Hagemann on March 15, 2010, with operating a Ponzi scheme involving the fraudulent solicitation of at least $700,000 from at least nine individuals to trade foreign currency futures (forex) managed accounts and/or a pooled investment. Defendants also allegedly attempted to solicit funds from at least one other individual (press release). See also the entry for July 15, 2011.

On March 2, 2010, the Securities Division of the North Carolina Department of the Secretary of State, obtained from the Securities Administrator an Order of Summary Suspension for the investment adviser registration of Cinchpoint, Inc., d/b/a Cinchpoint Financial Services, and the investment adviser representative registration of Jotham Walker Pruitt, both based in Durham, North Carolina. The Administrator also issued a Temporary Cease and Desist Order directing Cinchpoint, Pruitt and Ramses Capital Partners, LLC, to cease and desist from offering to sell or selling securities, including but not limited to interests in Ramses, in violation of the North Carolina Securities Act. For more information, click here.

On January 25, 2010, an investigation by the North Carolina Department of the Secretary of State ended in Catawba County Superior Court when J.V. Huffman, Jr. pleaded guilty to securities fraud and was sentenced to a minimum of 30 years in prison (press release). Huffman entered guilty pleas to 14 counts of felony securities fraud and 14 counts of felony obtaining property by false pretense. Superior Court Judge W. Robert Bell handed down a sentence of a minimum of 30 years and a maximum of 40 years and six months. More than 500 investors in Catawba County and the surrounding region invested approximately $25 million with Huffman between 1991 and November of 2008, when Secretary of State Agents arrested Huffman. Investigators with the Secretary of State’s Securities Division found that Huffman issued various kinds of promissory notes through his company, Biltmore Financial Group, claiming funds would be used to buy and sell real estate mortgages or deeds of trust. But the funds were instead converted to Huffman’s personal use, supporting a lavish lifestyle. For additional information about Huffman's arrest, please see the entry at November 7, 2008 below.

On January 19, 2010, The Securities Division filed an Administrative Petition seeking to revoke or suspend the North Carolina security dealer registration of E*Trade Securities, LLC. The Administrative Petition contains allegations of misconduct by E*Trade in the offer and sale of Auction Rate Securities (ARS) to North Carolina residents between 2005 and 2008. E*Trade has a right to an administrative hearing before this matter is concluded. The Division has cooperated with the North American Securities Administrators Association ARS Task Force in the Task Force investigation into the collapse of the ARS market in 2008. For more information, click here.

On January 13, 2010, the Securities Division of the North Carolina Department of the Secretary of State and Deutsche Bank Securities Inc., reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On January 6, 2010, the Securities Division of the North Carolina Department of the Secretary of State issued a Final Order to Cease and Desist directing Mason Barnes, Bradley Kirk Turner and Kentucky Mountain View Petroleum, Incorporated, a corporation formed in California, to cease and desist from offering to sell or selling securities, including but not limited to investment contracts in oil and gas exploration, in violation of the North Carolina Securities Act. The Final Order finds that Barnes and Turner were not licensed to sell securities in North Carolina and Kentucky Mountain View Petroleum, Inc. employed unlicensed salesmen to offer and sell their securities, in violation of the North Carolina Securities Act, and directs that the respondents immediately cease and desist such practices. For more information, click here.

On January 4, 2010, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Don G. Angell, Sr., a resident of Forsyth County, North Carolina, issued a Final Order, with the consent of Mr. Angell , and in which Mr. Angell was ordered to cease and desist from offering to sell or selling securities in violation of the North Carolina Securities Act, including, but not limited to, promissory notes issued by Mr. Angell . Mr. Angell had not registered or filed for any exemption from registration with the Division for his promissory notes. For more information, click here.

On December 23, 2009, the Securities Division of the North Carolina Department of the Secretary of State, issued a Final Order To Cease and Desist directing Sean F. Mescall, a resident of Iredell County, to cease and desist from offering to sell or selling securities, including, but not limited to foreign currency exchange accounts, issued by Mescall and CapitalStreet Financial, in violation of the North Carolina Securities Act. The Final Order finds that Respondent Mescall sold unregistered securities, among other violations of the North Carolina Securities Act, and directs that he immediately cease and desist from such practices. For criminal enforcement actions taken against him, see also the entries at September 8, 2009 below about his arrest and October 30, 2014 above for his sentencing (press release). For more information, click here.

On November 2, 2009, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Cease and Desist Order directing Mason Barnes, Bradley Kirk Turner and Kentucky Mountain View Petroleum, Incorporated , a corporation formed in California, to cease and desist from offering to sell or selling securities, including but not limited to investment contracts in oil and gas exploration, in violation of the North Carolina Securities Act. The temporary order finds that Barnesand Turner were not licensed to sell securities in North Carolina and Kentucky Mountain View Petroleum, Inc. employed unlicensed salesmen to offer and sell their securities, in violation of the North Carolina Securities Act, and directs that the respondents immediately cease and desist such practices. For more information, click here.

On October 20, 2009, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Prosper Marketplace, Inc. , issued an Administrative Final Order by Consent in which Prosper was ordered to cease and desist from offering to sell or selling its securities in violation of the North Carolina Securities Act. Prosper also agreed to and did make a contribution of $21,780.00 to the North Carolina Investor Education and Protection Fund. The Division and securities regulators of other states, cooperating through a working group organized by the North American Securities Administrators Association (NASAA), investigated the business conducted by Prosper between 2006 and October 2008. The NASAA group negotiated a national settlement in which the Division and Prosper participated. For more information, click here.

On September 11, 2009, the Securities Division of the North Carolina Department of the Secretary of State, issued an Order of Summary Suspension of any registration, right to register, transfer or renew a registration as a securities salesman of Charles Mark Hall of Smithfield, North Carolina. The Order of Summary Suspension finds that Respondent Hall was terminated by the securities dealer with whom he was affiliated after admitting to firm officials that he had misappropriated customer funds and is imposed during the pending administrative proceedings which will decide whether Respondent’s rights with regard to registration should be revoked. See additional information at the entry for 10/10/2011. For more information, click here.

On September 8, 2009, Sean Fitzgerald Mescall of Denver, NC, was arrested (press release) and ultimately convicted on December 6, 2012 of securities fraud, wire fraud and money laundering, and was sentenced to 195 months in prison, and ordered to pay $1,248,812.09 as restitution to his victims. Records show that from 2006 to 2010 Mescall executed a Ponzi scheme by inducing over 119 investors in Charlotte and elsewhere to invest more than $1.5 million in his investment company, Capitalstreet Financial, LLC (CSF), falsely representing that their money would be invested in the foreign currency market (FOREX). Mescall lied to his victims about his professional background and credentials, and about the nature of CSF. Investors were promised investors 60-80% annual returns, but instead Mescall used a substantial amount of investor money to pay for personal expenses unrelated to any foreign exchange. Most of the victims were elderly and the funds they invested were most, if not all, of their life savings. For more information, please see the press release issued by the Commodity Futures Trading Commission. The Securities Division of the North Carolina Department of the Secretary of State also issued a Temporary Cease and Desist Order directing Mescall and his company to cease and desist from offering to sell or selling securities. See also the entries for December 23, 2009 and October 30, 2014 above. For more information, click here.

On August 7, 2009, the Securities Division of the North Carolina Department of the Secretary of State and Credit Suisse Securities (USA) LLC, reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On July 7, 2009, the Securities Division of the North Carolina Department of the Secretary of State and RBC Capital Markets Corporation, reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On June 2, 2009, the Securities Division of the North Carolina Department of the Secretary of State, issued a Final Order To Cease and Desist directing S. Dean Martin, a resident of Iredell County, D. Martin Enterprises, Inc., a North Carolina corporation based in Iredell County, and DM Ventures, LLC , a Nevada limited liability company operated in Iredell County, North Carolina, to cease and desist from offering to sell or selling securities, including but not limited to promissory notes or similar agreements issued by any of them, in violation of the North Carolina Securities Act. The Final Order finds that Respondents have sold unregistered promissory notes, among other violations of the North Carolina Securities Act, and directs that the respondents permanently cease and desist from such practices. For more information, click here.

On May 26, 2009, the Securities Division of the North Carolina Department of the Secretary of State, issued a Temporary Cease and Desist Order directing Sidney Stanton Hanson and Charlotte Morrow Hanson , residents of Mecklenburg County, and Queen Shoals Group, LLC, Queen Shoals, LLC, and Queen Shoals II, LLC, entities not authorized to do business in North Carolina but operated by the Hansons in Mecklenburg County, North Carolina, to cease and desist from offering to sell or selling securities, including but not limited to promissory notes or similar agreements issued by any of them, in violation of the North Carolina Securities Act. The temporary order finds that Respondents have sold unregistered promissory notes, and have acted as unregistered securities dealers, violations of the North Carolina Securities Act, and directs that the respondents immediately cease and desist from such practices. For more information, click here.

On March 16, 2009, the Securities Division of the North Carolina Department of the Secretary of State and Citigroup Global Markets Inc., reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On March 3, 2009, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Cease and Desist Order directing S. Dean Martin, a resident of Iredell County, D. Martin Enterprises, Inc. , a North Carolina corporation based in Iredell County, and DM Ventures, LLC, a Nevada limited liability company operated in Iredell County, North Carolina, to cease and desist from offering to sell or selling securities, including but not limited to promissory notes or similar agreements issued by any of them, in violation of the North Carolina Securities Act. The temporary order finds that Respondents have sold unregistered promissory notes, among other violations of the North Carolina Securities Act, and directs that the respondents immediately cease and desist from such practices. For more information, click here.

On February 26, 2009, the Securities Division of the North Carolina Department of the Secretary of State and Wachovia Securities, LLC and Wachovia Capital Markets, LLC, reached settlement in the matter of Auction Rate Securities products sold by the company to investors in North Carolina. For more information, click here.

On November 7, 2008, J.V. Huffman, Jr., 44, of Claremont, NC, was charged by law enforcement agents of the North Carolina Secretary of State Division of Securities with four felony counts of securities fraud and issued a cease and desist order against him and his business corporation. Huffman was charged on the securities fraud counts in cases involving four investors who invested a total of $634,000 according to the Secretary of State’s Department. The Department is still investigating Huffman and his company, Biltmore Financial Group, Inc. Officials say further charges are possible (press release). The Secretary of State’s cease and desist order and arrest warrants charge that Huffman issued various kinds of promissory notes through his company claiming funds would be used to buy and sell real estate mortgages or deeds of trust. Rather than the monies being reinvested in such real estate business though, the arrest warrants allege Huffman instead took the monies for his own use. The cease and desist order also states that neither Huffman nor Biltmore Financial Group were registered to be conducting financial securities business. On November 12, 2008, the Securities and Exchange Commission charged Huffman and Biltmore Financial Group, Inc., with securities fraud for conducting a Ponzi scheme where more than $25 million was raised from investors and used primarily to fund Huffman's lavish lifestyle. The SEC also obtained a court order freezing the assets of Huffman and Biltmore, and appointing a temporary receiver (press release). For additional information about Huffman's conviction and sentencing, please see the entry at January 25, 2010 above (press release).

On November 6, 2008, the Securities Division of the North Carolina Department of the Secretary of State issued a Temporary Cease and Desist Order directing Biltmore Financial Group, Inc. , a North Carolina corporation, and J. V. Huffman Jr. , the primary owner of Biltmore Financial Group and a North Carolina resident, to cease and desist from offering to sell or selling securities, including but not limited to promissory notes issued by Biltmore Financial Group , in violation of the North Carolina Securities Act. The temporary order finds that Huffman and Biltmore Financial Group have sold unregistered promissory notes through persons not licensed to engage in securities transactions, among other violations of the North Carolina Securities Act, and directs that the respondents immediately cease and desist from such practices. For more information, click here.

On October 31, 2008, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Robert Lawrence Koppel, a resident of California, and Pro Financial Group, Inc., a California corporation, issued a Final Order in which Mr. Koppel and Pro Financial were ordered to cease and desist from offering to sell or selling securities to North Carolina residents in violation of the North Carolina Securities Act, including, but not limited to, the various financial products offered on a web site maintained by the Respondents. Neither Respondent admitted or denied the findings of the Administrator but did consent to the entry of the Order. For more information, click here.

On October 24, 2008, as the result of a multi-jurisdictional investigation, the Securities Division of the North Carolina Department of the Secretary of State entered into a Consent Order with Morgan Stanley & Co. Incorporated regarding its practice for checking to determine whether transactions complied with applicable securities registration requirements when entering into securities transactions with citizens of North Carolina. For more information, click here.

On September 29, 2008 , the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Red Dirt Rising, RLLP , a North Carolina Registered Limited Liability Partnership, and Gary E. Lewallen, a resident of Randolph County, North Carolina, issued a Final Order in which Red Dirt Rising and Mr. Lewallen were ordered to cease and desist from offering to sell or selling securities, including but not limited to limited liability partnership interests in Red Dirt Rising , in violation of the North Carolina Securities Act. Red Dirt Rising never registered its offering or filed for any exemption from registration with the Division. For more information, click here.

On September 29, 2008, the Division issued a Final Order making permanent the Temporary Order to Cease and Desist previously entered as to Charles Allen Smith and Sean Keating Helms. Mr. Smith and Mr. Helms failed to request a hearing after entry of the Temporary Order and thus have been permanently ordered to cease and desist from offering to sell or selling securities, including but not limited to promissory notes issued by IntelliCase , in violation of the North Carolina Securities Act. Neither Mr. Smith nor Mr. Helms ever held a license or registration to offer or sell securities in North Carolina. For more information, click here.

On September 12, 2008, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of IntelliCase Corporation and R. Gordon Gooding, issued a Final Order in which IntelliCase and Mr. Gooding were ordered to cease and desist from offering to sell or selling securities, including but not limited to promissory notes issued by IntelliCase , in violation of the North Carolina Securities Act. IntelliCase never registered its offering or filed for any exemption from registration with the Division. For more information, click here.

On June 23, 2008, W. Walter Wilkins, the U.S. Attorney for the District of South Carolina, announced a 36-count indictment against JOSEPH B. BRUNSON, age 46, of Hopkins, SC, TIMOTHY MCQUEEN, age 50, of Blythewood, SC, and TONY POUGH, age 46, of Columbia, SC, known collectively as the “Three Hebrew Boys.” They were charged with 35 counts of mail fraud and 1 count of conspiracy to commit mail fraud. Earlier, on May 21, 2007, the Securities Division of the Department of the Secretary of State of North Carolina issued a Summary Order to Cease and Desist against these same individuals (see the Order below). On November 5, 2007, the United States District Court for South Carolina appointed Mr. Beattie B. Ashmore, Esquire, to serve as the Receiver for the seizure, protection and management of all assets owned or controlled by these individuals and a number of related companies and individuals. The following website, http://www.3hbreceiver.com/, has been established for anyone who may have invested with Three Hebrew Boys and who wishes to file a claim for reimbursement if the defendants are found guilty."

On June 5, 2008, the Securities Division of the North Carolina Department of the Secretary of State, issued a Temporary Cease and Desist Order directing IntelliCase Corporation, a Delaware corporation based in California, R. Gordon Gooding, the Chief Financial Officer of IntelliCase and a resident of California, Charles Allen Smith, a North Carolina resident, and Sean Keating Helms, a North Carolina resident, to cease and desist from offering to sell or selling securities, including but not limited to promissory notes issued by IntelliCase , in violation of the North Carolina Securities Act. The temporary order finds that Respondents have sold unregistered promissory notes through persons not licensed to engage in securities transactions, among other violations of the North Carolina Securities Act, and directs that the respondents immediately cease and desist from such practices. For more information, click here.

On June 4, 2008, the Securities Division of the North Carolina Department of the Secretary of State issued an Order of Summary Suspension suspending the North Carolina securities salesman registration of Respondent Samuel Vaughn Watkins. The summary order finds that Respondent has willfully violated or failed to comply with provisions of the North Carolina Securities Act and that Respondent has engaged in dishonest or unethical practices in the securities business and directs that the Respondents' securities salesman registration be immediately suspended. For more information, click here.

On June 3, 2008, the North Carolina Secretary of State's Securities Division issued a Final Order Denying Registration to American Capital Advisors L.L.C. and Richard Duane White. The Final Order Denying Registration ordered that Respondents shall be denied registration as investment advisers or investment adviser representatives in North Carolina. For more information, click here.

On May 22, 2008, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of D. Trent Gourley , G & G, LLC , Gourley & Gourley, LLC , and Gourley and Associates, Inc. , issued a Final Order directing the named respondents to permanently cease and desist from offering to sell or selling securities in violation of the North Carolina Securities Act. Mr. Gourley, and the entities under his control, while based in Virginia, had offered and sold to North Carolina residents, limited liability company memberships with a guaranteed rate of return without first registering these securities with the Department as required by the North Carolina Securities Act. For more information, click here.

On May 7, 2008, the Securities Division of the North Carolina Department of the Secretary of State issued a Final Order to Cease and Desist to Paul Gwaz, aka Paul Gwazdauskas. This Order made permanent the terms of the Temporary Order to Cease and Desist issued on January 11, 2008, in this matter. Mr. Gwaz failed to object to the imposition of the Final Order or seek any hearing in this matter. Mr. Gwaz is restrained from offering to sell, or selling, interests in New Build Land Trust , or any other security, in North Carolina without first complying with the North Carolina Securities Act. For more information, click here.

On May 6, 2008, sentences were handed down in federal court to MICHAEL A. LOMAS, SCOTT B. HOLLENBECK, LAURINDA HOLOHAN, SUSAN KNIGHT, and ARTHUR J. ANDERSON, JR., for their involvement in the Mobile Billboards case.

On March 20, 2008, the North Carolina Secretary of State's Securities Division issued an Order of Summary Postponement to American Capital Advisors L.L.C. and Richard Duane White . The Order of Summary Postponement ordered pursuant to the authority contained in N.C.G.S. §78C-19(c) and78C-19(f), that, pending a final determination of this matter, the North Carolina registration of American Capital Advisors L.L.C. as an investment adviser be postponed. Also, it was further ordered that pending a final determination of this matter, the automatic North Carolina registrations as an investment adviser representative of Richard Duane White , and any and all other persons and entities occupying the status or function of executive officer or director of American Capital Advisors L.L.C. are postponed. For more information, click here.

On March 11, 2008, the Securities Division of the North Carolina Department of the Secretary of State, with the consent of Bryan Coats , issued a Final Order directing Mr. Coats to permanently cease and desist from offering to sell or selling securities in violation of the North Carolina Securities Act. Mr. Coats, an insurance agent in North Carolina, had engaged in the offer and sale of unregistered securities in the form of promissory notes from motion picture production promoters. For more information, click here.

On March 11, 2008, the North Carolina Secretary of State's Securities Division issued a Consent Order to Cease and Desist to Richard Duane White. The Consent Order ordered Richard Duane White to immediately cease and desist from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, investments in ETS Payphones, Inc., Evergreen Security, Ltd, Worldwide Income Partners, Inc or any other securities of any issuer, howsoever denominated, unless and until such securities have been registered pursuant to the provisions of the North Carolina Securities Act or such securities or transactions are exempt from such registration; and effecting securities transactions with a customer not recorded on the regular books or records of his dealer unless the transactions are disclosed to and authorized in writing by the dealer prior to execution of the transactions. For more information, click here.

On March 4, 2008, the North Carolina Secretary of State's Securities Division issued a Final Order to cease and desist to Lineberry & Company, Inc. and David W. Lineberry . The Final Order ordered Lineberry & Company, Inc. and David W. Lineberry to permanently cease and desist from i) offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, securities of Lineberry & Company, Inc. or any other security of any issuer in violation of N.C.G.S. §78A-24; and ii) transacting business in North Carolina as a dealer or salesman in violation of §78A-36; and iii) in connection with the offer, sale or purchase of any security, making any untrue statement of a material fact or omitting to state material facts necessary in order to make statements made, in light of the circumstances under which such statements were made, not misleading; and iv) engaging in any act, practice or course of business which operates or would operate as a fraud or deceit upon any person; and v) violating any section of the North Carolina Securities Act and any rule or regulation promulgated under the North Carolina Securities Act. For more information, click here.

On February 29, 2008, the North Carolina Securities Division issued a Temporary Order to Cease and Desist to Tyrone William "Cauzae" McCall, Terrilyn Bryant McCall, and MBG Global, LLC . The Temporary Order ordered the McCalls and MBG Global, LLC to immediately cease and desist from offering for sale, soliciting offers to purchase, or selling any securities, or acting as investment advisers, or offering to provide investment advisory services, or engaging in the business of investment advisers, either in or from North Carolina, unless and until any such securities are properly registered pursuant to the provisions of the North Carolina Securities Act and unless and until the McCalls and MBG Global, LLC ., are properly registered under both the North Carolina Securities Act and the North Carolina Investment Advisers Act. For more information, click here.

On January 11, 2008, the North Carolina Securities Division issued a Temporary Order to Cease and Desist to Paul Gwaz . The Temporary Order ordered Paul Gwaz, aka Paul Gwazdauskas , to immediately cease and desist from offering for sale, soliciting offers to purchase or selling, in or from North Carolina, interests in New Build Land Trust or any security of any issuer, unless and until such securities have been registered pursuant to the provisions of the North Carolina Securities Act and from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, securities of Learn Waterhouse, Inc. or any security of any issuer, unless and until he becomes registered as a dealer or salesman of securities pursuant to the North Carolina Securities Act. For more information, click here.

On May 6, 2008, Senior United States District Judge W. Earl Britt sentenced five defendants in the Mobile Billboards scheme. MICHAEL A. LOMAS , age unknown, of Pasadena, California, received 240 months’ imprisonment with 3 years supervised release; SCOTT B. HOLLENBECK , 53, of Orlando, Florida received 168 months’ imprisonment with 3 years supervised release following his term of confinement; LAURINDA HOLOHAN , 63, of Concord, Ohio, received 76 months’ imprisonment with 3 years supervised release; SUSAN KNIGHT , 48, of Eastlake, Ohio, received 30 months’ imprisonment with 2 years supervised release; and ARTHUR J. ANDERSON, JR. , 49, of Raleigh, North Carolina, received 60 months’ imprisonment with 3 years supervised release. Investigation of the case was conducted by the United States Postal Inspection Service, the Federal Bureau of Investigation, and the North Carolina Department of the Secretary of State, Securities Division.

On February 6, 2008, a jury in Raleigh, North Carolina convicted SCOTT B. HOLLENBECK, 53, of Orlando, Florida and LAURINDA HOLOHAN, 63, of Concord, Ohio of conspiracy and 12 of 14 counts charging mail fraud. BARRY C. MALONEY, 65, of Bethesda, Maryland was acquitted on all counts. Three others had been charged and previously pled guilty in this case, United States v. Lomas et al., 5:07-CR-117-BR: MICHAEL A. LOMAS, age unknown, of Pasadena, California; SUSAN KNIGHT, 48, of Eastlake, Ohio; and ARTHUR J. ANDERSON, JR., 49, of Raleigh, North Carolina. A seventh defendant, MICHAEL L. YOUNG, 61, is a fugitive from justice and is believed to be residing in the United Arab Emirates. Investigation of the case, which is ongoing, is being conducted by the United States Postal Inspection Service, the Federal Bureau of Investigation, and the North Carolina Department of the Secretary of State, Securities Division.

On December 5, 2007, the North Carolina Secretary of State's Securities Division issued a Final Order to Cease and Desist to Arthur Kenneth Weaver, Jr. and Rowan Health and Fitness Ltd. dba “GX Fitness and Wellness”. The Final Order ordered Arthur Kenneth Weaver, Jr. and Rowan Health and Fitness Ltd. dba “GX Fitness and Wellness” to permanently cease and desist from offering for sale, soliciting offers to purchase, or selling securities of Rowan Health and Fitness Ltd. and selling any securities of any issuer in violation of §§78A-8, and 78A-24 of the North Carolina Securities Act For more information, click here.

On November 30, 2007, the North Carolina Secretary of State's Securities Division issued a Consent Order to Cease and Desist to Leonard Jackson . The Consent Order ordered Leonard Jackson to cease and desist from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, stock and stock options of JEL Company and any other securities of any issuer, unless and until such securities have been registered pursuant to the provisions of the North Carolina Securities Act and from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, stock or stock options of JEL Company or securities of any issuer, unless and until he becomes registered as a dealer or salesman of securities pursuant to the North Carolina Securities Act. For more information, click here.

On October 26, 2007, the North Carolina Secretary of State's Securities Division issued a Consent Order to Cease and Desist to Ray S. Fisher, Jr. The Consent Order ordered Ray S. Fisher, Jr. to cease and desist from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, securities of Learn Waterhouse, Inc. and any security of any issuer, unless and until such securities have been registered pursuant to the provisions of the North Carolina Securities Act and from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, securities of Learn Waterhouse, Inc. or any security of any issuer, unless and until he becomes registered as a dealer or salesman of securities pursuant to the North Carolina Securities Act. For more information, click here.

On September 11, 2007, the North Carolina Secretary of State's Securities Division issued a Summary Order to Cease and Desist against Bryan Coats . The Summary Order ordered Bryan Coats to immediately cease and desist from offering for sale, soliciting offers to purchase, or selling securities in the form of “movie production loan” programs or selling any securities of any issuer in violation of §§78A-24, and 78A-36 of the North Carolina Securities Act. For more information, click here.

On August 21, 2007, the North Carolina Secretary of State's Securities Division issued a Consent Order to Cease and Desist to Christopher Wallace Pustorino, dba Main Street Curio . The Consent Order ordered Christopher Wallace Pustorino, dba Main Street Curio to cease and desist immediately and permanently from, in connection with the offer, sale or purchase of any security, making any untrue statements of a material fact. For more information, click here.

On August 9, 2007, the North Carolina Secretary of State's Securities Division issued a Final Order to Cease and Desist to Joseph C. Franklin and Savant Interest, L.L.C . The Final Order ordered Joseph C. Franklin and Savant Interest, L.L.C. to cease and desist permanently from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, securities of Savant Interest, L.L.C. and any security of any issuer, unless and until such securities have been registered pursuant to the provisions of the North Carolina Securities Act and from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, securities of Savant Interest, L.L.C., or any security of any issuer, unless and until Respondents become registered as a dealer or salesman of securities pursuant to the North Carolina Securities Act. For more information, click here.

On July 26, 2007, the North Carolina Secretary of State's Securities Division issued a Final Order to Cease and Desist to Walter Ray Reinhardt . The Final Order ordered Walter Ray Reinhardt to cease and desist immediately and permanently from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, the securities of any issuer in violation of §§78A-24 of the North Carolina Securities Act. For more information, click here.

On July 11, 2007, the North Carolina Secretary of State's Securities Division issued a Final Order to Cease and Desist to Ronald Alan Bryant . The Final Order ordered that the Respondent immediately and permanently cease and desist from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina securities of Financial Solutions, Inc. and any securities of any issuer in violation of § 78A-8, 78A-24, and 78A-36 of the North Carolina Securities Act. For more information, click here.

On June 13, 2007, the North Carolina Secretary of State's Securities Division issued a Summary Order to Suspend the Offer and Sale to DAYSTAR OIL AND GAS CORPORATION . The Summary Order ordered DAYSTAR to suspend the offer and sale of its covered security referenced in DAYSTAR’SRegulation D 506 Notice filing filed with the Division until the Respondent has complied with the conditions set out in N.C.G.S. § 78A-31(b). For more information, click here.

On May 29, 2007, the U.S. Attorney for the Eastern District of North Carolina announced an eighteen-count Indictment charging seven individuals nationwide with what the Indictment alleges was "an extensive scheme to defraud individuals seeking financially secure retirements out of approximately seventy million dollars." The Indictment alleges that the seven defendants participated in a scheme to sell purported investments in Mobile Billboards of America, Inc." Investigation of the case was conducted by the Federal Bureau of Investigation and the North Carolina Department of the Secretary of State, Securities Division.

On May 29, 2007, the U.S. Attorney for the Eastern District of North Carolina announced an eighteen-count Indictment charging seven individuals nationwide with what the Indictment alleges was "an extensive scheme to defraud individuals seeking financially secure retirements out of approximately seventy million dollars." The Indictment alleges that the seven defendants participated in a scheme to sell purported investments in "Mobile Billboards of America, Inc." Investigation of the case was conducted by the Federal Bureau of Investigation and the North Carolina Department of the Secretary of State, Securities Division.

On May 29, 2007, the U.S. Attorney for the Eastern District of North Carolina announced an eighteen-count Indictment charging seven individuals nationwide with what the Indictment alleges was "an extensive scheme to defraud individuals seeking financially secure retirements out of approximately seventy million dollars." The Indictment alleges that the seven defendants participated in a scheme to sell purported investments in "Mobile Billboards of America, Inc." Investigation of the case was conducted by the Federal Bureau of Investigation and the North Carolina Department of the Secretary of State, Securities Division

On May 21, 2007, the North Carolina Secretary of State's Securities Division issued a Summary Order to Cease and Desist to 3 Hebrew Boys, L.L.C .; Capital Consortium Group, L.L.C .; Tony Pough ; Tim McQueen ; Joseph Brunson ; and Howard Lee Lattimore (collectively, the " Respondents "). The Summary Order ordered the Respondents to cease and desist immediately from offering for sale, soliciting offers to purchase, or selling securities of 3 Hebrew Boys, L.L.C. or of Capital Consortium Group, L.L.C. or any securities of any issuer in violation of §§78A-24 and 78A-36 of the North Carolina Securities Act. For more information, click here.

On April 25, 2007, the North Carolina Secretary of State, Securities Division issued a Final Order to Cease and Desist to Larry Wayne Sexton . The Final Order ordered Larry Wayne Sexton to permanently cease and desist from offering for sale, soliciting offers to purchase, or selling securities in or from North Carolina, securities in the form of investment contracts to purchase vacation units with a management agreement and any security of any issuer in violation of N.C.G.S. §§78A-24 and 78A-36. Further, Larry Wayne Sexton has been ordered to permanently cease and desist from, in connection with the offer, sale or purchase of any security, omitting to state material facts necessary in order to make statement made, in light of the circumstances under which such statements were made, not misleading and from violating any provision of Article 2, entitled Fraudulent and Other Prohibited Practices, of the North Carolina Securities Act. For more information, click here.

On April 25, 2007, the North Carolina Secretary of State, Securities Division issued a Final Order to Cease and Desist to Ronald G. Calvert . The Final Order ordered Ronald G. Calvert to permanently cease and desist from offering for sale, soliciting offers to purchase, or selling securities in or from North Carolina, securities in the form of investment contracts to purchase vacation units with a management agreement and any security of any issuer in violation of N.C.G.S §§78A-24 and from transacting business in this State as a dealer or salesman of securities in violation of N.C.G.S §§78A-36 of the North Carolina Securities Act. Further, Ronald G. Calvert has been ordered to permanently cease and desist from, in connection with the offer, sale, or purchase of any security, omitting to state material facts necessary in order to make statement made, in light of the circumstances under which such statements were made, not misleading and from violating any provision of Articles 2. entitled Fraudulent and Other Prohibited Practices, of the North Carolina Securities Act, specifically, Sections N.C.G.S §78A-8 through N.C.G.S §78A-14.

On April 4, 2007, the North Carolina Secretary of State's, Securities Division issued a Final Order to Robert M. Lowe, Jr. dba Lowe Financial Planning . The Final Order ordered the Respondent to permanently cease and desist from transacting business in this State as an investment adviser without being registered to do so. Also, Robert M. Lowe agreed to pay $25,000 in settlement of the securities investigation. For more information, click here.

On April 2, 2007, Joe Jones pleaded guilty to 41 violations of the Securities Act and five charges of Obtaining Property by False Pretense. He was sentenced to a minimum of 20 years and a maximum of 26.25 years in the North Carolina Department of Corrections.

On March 23, 2007, the North Carolina Secretary of State's Securities Division issued a Summary Order to Cease and Desist to Lineberry & Company, Inc. and David W. Lineberry . The Division was made aware that the company was offering to sell securities through means of a newspaper advertisement without complying with the registration requirements of the North Carolina Securities Act. The Deputy Securities Administrator issued a Summary Order to the company to stop the advertisements. The case is still under review. For more information, click here.

On March 8, 2007, the North Carolina Secretary of State's Securities Division issued a Temporary Order to Cease and Desist to Walter Ray Reinhardt, Joseph C. Franklin and Savant Interest, L.L.C . The Temporary Order ordered Walter Ray Reinhardt, Joseph C. Franklin , and Savant Interest, L.L.C to cease and desist immediately from offering for sale, soliciting offers to purchase, or selling securities of Savant Interest, L.L.C or selling any securities of any issuer in violation of §§78A-24, and 78A-36 of the North Carolina Securities Act. For more information, click here.

On March 5, 2007, the North Carolina Secretary of State's Securities Division issued a Final Order to Cease and Desist to Sports Dimensions, Inc. and Marc Hubbard . The Summary Order ordered Sports Dimensions , Inc. and Marc Hubbard to cease and desist immediately from offering for sale, soliciting offers to purchase, or selling securities in the form of investment contracts and promissory notes or selling any securities of any issuer in violation of §§78A-24, and 78A-36 of the North Carolina Securities Act. For more information, click here.

On February 20, 2007, the North Carolina Secretary of State's, Securities Division issued a Temporary Order to Cease and Desist and Summary Suspension of Registration to Ronald Alan Bryant, Paul Carrier and Financial Solutions, Inc. The Temporary Order ordered that the Respondents immediately cease and desist from offering for sale, soliciting offers to purchase, or selling any securities or selling any securities of any issuer in violation of §§78A-8, 78A-24 and 78A-36 of the North Carolina Securities Act. For more information, click here.

On February 16, 2007, the North Carolina Secretary of State's, Securities Division entered into an order to Consent to Final Order to Cease and Desist with Southeastern Financial Resources, LLC and Mark Edward Patty . The Final Order ordered Southeastern Financial Resources and Mark Edward Patty to cease and desist immediately from offering for sale, soliciting offers to purchase, or selling any securities in the form of common stock and debentures issued by Titan Composites, Inc., or selling any securities of any issuer in violation of §§78A-24 and 78A-36 of the North Carolina Securities Act. For more information, click here.

On January 2, 2007, the North Carolina Secretary of State's Securities Division issued a Summary Order to Cease and Desist to Sports Dimensions, Inc. and Marc Hubbard . The Summary Order ordered Sports Dimensions , Inc. and Marc Hubbard to immediately cease and desist from offering for sale, soliciting offers to purchase, or selling securities in the form of investment contracts and promissory notes or selling any securities of any issuer in violation of §§78A-24, and 78A-36 of the North Carolina Securities Act. For more information, click here.

On December 14, 2006, the North Carolina Secretary of State, Securities Division issued a Consent Order to EFR Financial Services, LLC ; Roger Van Edwards ; Byron Keith Falls ; Terry Norris Renegar ; and Bryan Speas Davis . The Consent Order ordered the Respondents to immediately cease and desist from offering for sale, soliciting offers to purchase, or selling, in or from North Carolina, the securities of ACM Financial Trust, Inc. (formerly known as Atlantic Capital Management, Inc.) or any security of any issuer in violation of N.C.G.S. §§78A-8 and 78A-36. Respondents were also ordered to immediately cease and desist from transacting business in this State as an investment adviser representative unless and until said persons become registered as investment adviser representatives pursuant to the provisions of the North Carolina Investment Advisers Act and Respondents were also ordered to cease and desist from, in the solicitation of advisory clients, making any untrue statements of a material fact. Also, EFR Financial Services , LLC agreed to pay $20,000.00 in settlement of the securities investigation. For more information, click here.

On November 21, 2006, the North Carolina Secretary of State, Securities Division issued a Temporary Order to Cease and Desist to Larry Wayne Sexton . The Temporary Order ordered Larry Wayne Sexton to immediately cease and desist from offering for sale, soliciting offers to purchase, or selling securities in or from North Carolina, securities in the form of investment contracts to purchase vacation units with a management agreement and any security of any issuer unless and until such securities have been registered pursuant to N.C.G.S. §78A-24 and unless and until Larry Wayne Sexton becomes registered as a dealer or salesman of securities pursuant to N.C.G.S. §78A-36. Further, Larry Wayne Sexton has been ordered to immediately cease and desist from, in connection with the offer, sale or purchase of any security, omitting to state material facts necessary in order to make statement made, in light of the circumstances under which such statements were made, not misleading. For more information, click here.

On November 14 , 2006, the North Carolina Secretary of State, Securities Division issued a Temporary Order to Cease and Desist to Ronald G. Calvert . The Temporary Order ordered Ronald G. Calvert to immediately cease and desist from offering for sale, soliciting offers to purchase, or selling securities in or from North Carolina, securities in the form of investment contracts to purchase vacation units with a management agreement and any security of any issuer unless and until such securities have been registered pursuant to N.C.G.S. §78A-24 and unless and until Ronald G. Calvert becomes registered as a dealer or salesman of securities pursuant to N.C.G.S. §78A-36. Further, Ronald G. Calvert has been ordered to immediately cease and desist from, in connection with the offer, sale or purchase of any security, omitting to state material facts necessary in order to make statement made, in light of the circumstances under which such statements were made, not misleading For more information, click here.

On November 14, 2006, the North Carolina Secretary of State's Securities Division issued a Summary Order to Cease and Desist to Titan Composites, Inc., Bryan K. Noel, Christopher D. Hughes, Southeastern Financial Resources, LLC and Mark Edward Patty . The Summary Order ordered Titan Composites, Inc., Bryan K. Noel, Christopher D. Hughes, Southeastern Financial Resources, LLC and Mark Edward Patty to immediately cease and desist from offering for sale, soliciting offers to purchase, or selling securities in the form of Titan convertible subordinated debentures and Titan common stock or selling any securities of any issuer in violation of §§78A-24, and 78A-36 of the North Carolina Securities Act. For more information, click here.

On November 8, 2006, the North Carolina Secretary of State's Securities Division entered into a Consent Order with Cornerstone Ministries Investments, Inc., Cecil A Brooks and John T. Ottinger. The Consent Order ordered is related to the unregistered sale of common stock and investments in the form of evidence of indebtedness by CMI to N.C. residents. The Consent Order included a written Offer of Rescission to all North Carolina investors who had invested during the relevant period of time of this Consent Order For more information, click here.

On September 11, 2006, the North Carolina Secretary of State's Securities Division issued a Final Order to Cease and Desist to and Quality Life Financial, LLC . The Final Order ordered that Wabel and Quality Life Financial, LLC , permanently cease and desist from offering for sale, soliciting offers to purchase, or selling any securities of any issuer in violation of §§78A-24, and 78A-36 of the North Carolina Securities Act.