The court has frozen the assets of the Texas-based Army veteran and his firm.

The Securities and Exchange Commission said Tuesday that it had filed fraud charges against an Army veteran in Texas, alleging he lied about his financial experience to lure current and former U.S. military personnel into investing with him.

The SEC alleges that Leroy Brown Jr. promoted himself as an Army veteran to attract members of the military and other investors to his firm LB Stocks and Trades Advice LLC. 

The regulators are seeking “financial penalties and disgorgement of ill-gotten gains as well as permanent injunctive relief,” and the court has issued an order temporarily freezing assets of Brown and his firm. 

“Brown falsely assured investors, including some stationed at nearby Fort Hood, that he had many years of experience in the securities markets,” the regulator said in a press release. “He specifically claimed to have all the necessary licenses and registrations to conduct securities business.

“In reality,” the SEC continued, “Brown is not a licensed securities professional, and his firm is not registered with the SEC, Financial Industry Regulatory Authority or any state regulator.  Brown and his firm have no evident experience with investments.”

In addition, the SEC says Brown falsely guaranteed investors that he would “double or triple their money within 120 days.”

“Trust is a bedrock principle to our military, and we allege that Brown exploited his own military experience and abused that trust for his own personal gain,” said David Woodcock, director of the SEC’s Fort Worth regional office, in a statement. “Investment fraud is always wrong, but it’s especially pernicious when perpetrated against those who have sacrificed so much for our freedom.”

Brown’s website (which features an image of the New York skyline) explains that the firm believes, “Achievers choose what losers won’t and pay the price that others don’t.”  It also says the firm gives free advice regarding military deployment and redeployment investment solutions, low-income family advice and financial makeovers.

The SEC filed its complaint in the U.S. District Court for the Western District of Texas. It charges Brown and LB Stocks and Trades Advice with securities fraud and conducting an unregistered securities offering.

Its investigation was conducted by Chris Ahart and Melvin Warren of the Fort Worth regional office. The case was supervised by Jim Etri, while the SEC’s litigation is being led by B. David Fraser. 

The federal regulators note that the U.S. Attorney’s Office for the Western District of Texas, the U.S. Secret Service, and the Texas Department of Public Safety-Criminal Investigations Division have assisted them with the matter.

— Check out Ex-NFL Player Accused of Ponzi Scheme: SEC on ThinkAdvisor.