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Regulation and Compliance > Federal Regulation > SEC

SEC Halts Ponzi Scheme Funding Racehorse Stable, Limo Service

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What You Need to Know

  • The SEC obtained a temporary restraining order and an asset freeze to stop the long-running scam.
  • Many of the defendants' victims were older clients, including friends and family members of the couple.
  • The SEC also named four entities controlled by the defendants as relief defendants in its complaint.

The Securities and Exchange Commission on Tuesday filed an emergency action and obtained a temporary restraining order and an asset freeze on an alleged Ponzi scheme operated by a Shakopee, Minnesota couple and Bullard Enterprises, an entity they control.

According to the complaint, filed in U.S. District Court for the District of Minnesota, from at least 2007 to 2021, Jason Dodd Bullard and Angela Romero-Bullard raised about $17.6 million from as many as 200 people, including many retirees, to invest in Bullard Enterprises’ purported Flagship and Platinum Funds.

From 2000 to 2004, Bullard, 57, was associated with a broker-dealer and had series 6 and 63 securities licenses, according to the SEC. In 2010, he started the process to register with the National Futures Association as an “Associated Forex Person” but did not complete the process, the SEC said. Romero-Bullard, 49, “has no known securities licenses,” according to the SEC.

The defendants did not immediately respond to requests for comment on Wednesday.

The SEC also named four entities controlled by the defendants that received investor funds from the alleged scheme as relief defendants in the complaint.

Those relief defendants, all operating out of the defendants’ current or former home addresses, are: DLJ Real Estate, Empire Investments, TI 13, and Empire Racing Stables, an operation with 24 horses offered to investors so they can “own a race horse today,” according to its website.

Bullard and Romero-Bullard allegedly told investors their investments would be used to trade foreign currencies, and sent investors account statements showing their accounts were increasing in value.

In reality, however, according to the complaint, Bullard Enterprises stopped trading in foreign currencies in 2015, and the defendants used new investor money to pay purported “returns” to existing investors.

Bullard and Romero-Bullard misappropriated investors’ money to support other businesses they owned, including the horse racing stable, limousine service and health and fitness studio, the SEC alleged. The defendants also allegedly used the funds to make car payments, pay off personal credit cards and life insurance premiums, and for general living expenses, the SEC said.

“A significant amount of the funds were raised since 2019,” including $1.97 million since 2020, according to the complaint.

The couple “pooled a small portion of the investor funds” into Bullard Enterprises’ brokerage accounts at TD Ameritrade, the SEC said, noting the defendants are listed as account holders with trading authorization for those accounts.

“Many of the investor-victims in this case were friends and family of Bullard and Romero-Bullard who trusted their promises about investment strategy and expected returns,” according to Nekia Hackworth Jones, director of the SEC’s Atlanta Regional Office.

The SEC’s complaint charged the defendants with violating the antifraud provisions of federal securities laws. In addition to temporary relief, the complaint seeks, among other things, preliminary and permanent injunctions, disgorgement, prejudgment interest, civil penalties and an asset freeze.

(Pictured: Horses at the Kentucky Derby. Photo: AP)


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