The Atlanta-area advisor who recently went missing and became the target of an FBI search after allegedly scamming about 100 investors as part of a Ponzi scheme involving the sale of illegal promissory notes is now facing charges by the Securities and Exchange Commission in addition to the class-action lawsuit that was filed against him by disgruntled clients.
In a complaint filed Thursday in U.S. District Court for the Northern District of Georgia in Atlanta, the SEC charged Christopher W. Burns, of Berkeley Lake, Georgia, and his various business entities with defrauding investors and misappropriating investor funds. His ex-wife, Meredith Burns, was named as a relief defendant.
According to the SEC’s complaint, Burns, through his investment advisor firm Investus Advisers (doing business as Dynamic Money), sold more than $10 million in promissory notes issued by two of his other companies — Investus Financial and Peer Connect — to investors.
The complaint alleges Burns falsely told investors he would use their funds for a peer-to-peer lending program for businesses in need of capital. Burns allegedly claimed the notes were backed by collateral held in accounts at Charles Schwab and that they presented little or no risk.
However, the peer-to-peer lending program was a “sham,” and Burns actually spent the money he raised to repay earlier investors, fund his lifestyle and elevate his status as an investment advisor by buying tens of thousands of dollars of airtime for his local radio show, according to the SEC.
The complaint further alleged Burns increased his promissory note sales in recent months, then disappeared with investor proceeds in late September.
One the day before he disappeared, Burns entered a divorce agreement with his wife that transferred many of their joint assets to her and, on the day he disappeared, he transferred his interest in their home to her, the SEC alleged.
Noting that Meredith Burns did not have income independent of her husband, the SEC claimed she was in possession of other assets that seemed to be either bought or maintained with investors’ assets, including a boat, cars and cash in her bank accounts.
On the day the SEC filed the complaint, the same court entered an order temporarily restraining the defendants from violating the charged provisions of the federal securities laws, instituting an asset freeze and ordering other relief.
The FBI and U.S. Attorney’s Office for the Northern District of Georgia announced Oct. 26 that Burns was charged with mail fraud and there was a warrant for his arrest because his whereabouts were unknown.
Burns “has not been located since he left his home on September 24, 2020, one day before he was supposed to turn over documents related to his businesses” to the SEC, the FBI said in a news release.
He is also under investigation by the Internal Revenue Service, the FBI said.
As of Monday, the whereabouts of Burns remained unknown, Kevin Rowson, a public affairs specialist with the FBI in Atlanta, told ThinkAdvisor.
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