Commonwealth Secretary William F. Galvin charged a Massachusetts investment advisor agent with orchestrating a complex real estate scheme that defrauded investors and other clients out of at least $1 million over the past 26 years.
The administrative complaint filed by Galvin’s Securities Division states that Thomas Riquier solicited money from clients and others, a majority of whom are elderly residents of the North Shore, used to purchase property in Rowley, Massachusetts, which investors were told would then be sold for a profit.
In reality, the complaint states, the investments were used to purchase property already owned by Riquier. To date, the property has not been sold or improved and has not provided any returns on the money invested, according to the complaint.
“This scheme has been going on for so long that many of the original investors and clients have died while the remaining elderly Massachusetts investors have not seen a penny returned on their 26-year-old investment,” the complaint states.
The complaint further alleges that Riquier solicited more than $800,000 in private loans from his clients, again mainly residents of the North Shore, in violation of state and federal law.
Also named in the complaint is United Planners Financial Services of America, which employed Riquier as an investment advisor agent throughout the 26 years the alleged scheme took place. According to the complaint, the firm, which employed Riquier’s own son-in-law to supervise him, failed to appropriately monitor their agent’s actions.
The complaint seeks a cease-and-desist order, censure and administrative fine, and the revocation of Riquier’s registrations as an investment advisor agent and broker-dealer in Massachusetts.
Galvin’s office is also seeking an order requiring Riquier to pay restitution to compensate investors for their losses under the scheme.
SEC Suspends Trading in 3 Firms Claiming Blockchain Involvement
The SEC suspended trading in three companies amid questions surrounding similar statements they made about the acquisition of cryptocurrency and blockchain technology-related assets.
The SEC’s trading suspension orders state that recent press releases issued by Cherubim Interests Inc. (CHIT), PDX Partners Inc. (PDXP) and Victura Construction Group Inc. (VICT) claimed that the firms acquired AAA-rated assets from a subsidiary of a private equity investor in cryptocurrency and blockchain technology among other things. According to the SEC order regarding CHIT, it also announced the execution of a financing commitment to launch an initial coin offering.
According to the SEC’s orders, there are questions regarding the nature of the companies’ business operations and the value of their assets, including in press releases issued beginning in early January 2018. The SEC also suspended trading in the securities of CHIT because of its delinquency in filing annual and quarterly reports.
Under the federal securities laws, the SEC can suspend trading in a stock for 10 days and generally prohibit a broker-dealer from soliciting investors to buy or sell the stock again until certain reporting requirements are met. The stocks of CHIT, PDXP and VICT are all quoted on OTC Link operated by OTC Markets Group.
Deutsche Bank to Repay Misled Customers
Deutsche Bank Securities Inc. agreed to repay more than $3.7 million to customers, which includes $1.48 million that was ordered as disgorgement, according to the Securities and Exchange Commission.
The SEC’s investigation found that traders and salespeople made false and misleading statements while negotiating sales of commercial mortgage-backed securities (CMBS). According to the SEC’s order, customers overpaid for CMBS because they were misled about the prices at which Deutsche Bank had originally purchased them.
According to the SEC, Deutsche Bank failed to have compliance and surveillance procedures in place that were reasonably designed to prevent and detect the misconduct that consequently increased the firm’s profits on CMBS transactions to the detriment of its customers.
The SEC’s order finds supervisory failures by the former head trader of Deutsche Bank’s CMBS trading desk, Benjamin Solomon, who did not take appropriate action after becoming aware of false statements made to customers by traders under his supervision, including specific misrepresentations about the prices that Deutsche Bank paid for the CMBS.
To settle the charges, Deutsche Bank agreed to reimburse customers the full amount of firm profits earned on any CMBS trades in which a misrepresentation was made. According to a payment schedule in the order, Deutsche Bank will distribute more than $3.7 million. Deutsche Bank also agreed to pay a $750,000 penalty. Solomon agreed to pay a $165,000 penalty and serve a 12-month suspension from the securities industry.
Georgia Man Charged With Bilking Submarine Investors to Pay Sudent Loans
The SEC filed an enforcement action against an Atlanta-area resident who allegedly misused more than $1.2 million in investments intended to support national security-related businesses and the development of a high-performance submarine vessel.