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September 14, 2015 at 08:57 AM
The Securities and Exchange Commission Friday charged five Arizona residents with stealing approximately $18 million from investors via radio, magazine and Internet ads to fund a fictitious beachfront property development in Mexico.
The SEC alleges that the five men also solicited investors through marketing materials, cold calls and investor presentations, and that the men used the stolen millions from investors to make car payments, buy clothes, and fund trips to strip clubs, casinos and Disneyland.
Jason Mogler, James Hinkeldey, Casimer Polanchek, Brian Buckley and James Stevens misappropriated roughly 97% of the $18 million they raised from 225 investors who were told the funds would be used to acquire and develop beachfront property in Mexico as well as to operate recycling facilities and purchase foreclosed residential properties for resale.
The men “repeatedly lied about the purported progress of the investments to calm worried investors as time extended past when their promissory notes should have been repaid,” the SEC states. In certain instances they made Ponzi-like payments to investors who were threatening them with lawsuits by using money from new investors, which Mogler termed “robbing Peter to pay Paul.”
From at least October 2006 until October 2012, the men offered and sold promissory notes issued by Tri-Core Mexico, Tri-Core Cos. and Mar De Cortez, raising approximately $10 million from investors, according to the SEC order.
Defendants provided investors and potential investors with offering materials stating that investor funds would be used to purchase and develop waterfront investment property in San Luis Rio Colorado, Sonora, Mexico, and Polanchek in particular, the SEC states, was known to solicit potential investors at such venues as bars, cruises and self-help seminars.
The men also participated in an Arizona radio program called The Investment Roadshow during which they instructed listeners about how to use self-directed IRAs to invest in their companies, according to the SEC.
