The Securities and Exchange Commission on Thursday announced charges against accused repeat offender Geoffrey J. Thompson, claiming he illegally sold more than $19 million in unregistered securities for a cannabis company he controlled.
In a complaint filed in U.S. District Court for the Northern District of Illinois, Eastern Division, the SEC says Thompson directed numerous offerings of unregistered securities from at least July 2014 through June 2019, ultimately raising more than $19 million from about 500 investors.
Calling him a “recidivist securities laws violator,” the SEC claimed he and his firm, Covalent Collective, used numerous mechanisms to solicit investors, including providing investors video and audio recordings in which he encouraged them to spread the word about the company’s securities to friends and family.
The complaint further alleged that, despite raising almost $20 million, Covalent never commenced any revenue-generating operations. Thompson diverted more than $2.7 million of investor funds for his own benefit, the SEC said.
In the process, he violated securities registration provisions of Sections 5(a) and 5(c) the Securities Act of 1933, the SEC alleged.
The SEC seeks injunctive relief, disgorgement of ill-gotten gains and prejudgment interest, and civil money penalties.