From SEC Press Release at
\nhttp:\/\/www.sec.gov\/news\/press\/2009\/2009-30.htm<\/p>\n
Securities and Exchange Commission<\/p>\n
SEC Halts Ponzi Scheme Targeting Deaf Investors<\/p>\n
FOR IMMEDIATE RELEASE<\/p>\n
2009-30<\/p>\n
Washington, D.C., Feb. 19, 2009 \u2014 The Securities and Exchange
\nCommission has obtained a court order halting a Ponzi scheme that
\nspecifically targeted members of the Deaf community in the United
\nStates and Japan.<\/p>\n
Additional Materials<\/p>\n
Litigation Release No. 20906<\/p>\n
SEC Complaint<\/p>\n
The SEC alleges that Hawaii-based Billion Coupons, Inc. (BCI) and its
\nCEO Marvin R. Cooper raised $4.4 million from 125 investors since at
\nleast September 2007 by, among other things, holding investment
\nseminars at Deaf community centers. The SEC also alleges that Cooper
\nmisappropriated at least $1.4 million in investor funds to pay for a
\nnew home and other personal expenses. The order obtained by the SEC
\nfreezes the assets of BCI and Cooper.<\/p>\n
“This emergency action shows that the Commission will act quickly and
\ndecisively to help victims of affinity fraud,” said Linda Chatman
\nThomsen, Director of the SEC’s Division of Enforcement.<\/p>\n
“A Ponzi scheme targeting members of the Deaf community is
\nparticularly reprehensible,” said Rosalind R. Tyson, Regional Director
\nof the SEC’s Los Angeles Regional Office. “This case is an example of
\nsuccessful coordination between federal and state agencies to protect
\nvulnerable investors.”<\/p>\n
The SEC’s complaint, filed yesterday in federal court in Honolulu,
\nalleges that BCI and Cooper represented to the investors that their
\nfunds would be invested in the foreign exchange (Forex) markets, that
\ninvestors would receive returns of up to 25 percent compounded monthly
\nfrom such trading, and that their investments were safe. According to
\nthe complaint, BCI and Cooper actually used only a net $800,000 (cash
\ndeposits minus cash withdrawals) of investor funds for Forex trading,
\nand they lost more than $750,000 from their Forex trading. The
\ncomplaint further alleges that BCI and Cooper failed to generate
\nsufficient funds from their Forex trading to pay the promised returns,
\nand instead operated as a Ponzi scheme by paying returns to existing
\ninvestors from funds contributed by new investors.<\/p>\n
The SEC alleges that BCI and Cooper have violated the registration
\nand antifraud provisions of the federal securities laws. In its
\nlawsuit, the SEC obtained an order temporarily enjoining BCI and
\nCooper from future violations of these provisions. The SEC also
\nobtained an order: (1) freezing the assets of BCI and Cooper; (2)
\nappointing a temporary receiver over BCI; (3) preventing the
\ndestruction of documents; (4) granting expedited discovery; and (5)
\nrequiring BCI and Cooper to provide accountings. The Commission also
\nseeks preliminary and permanent injunctions, disgorgement, and civil
\npenalties against both defendants. A hearing on whether a preliminary
\ninjunction should be issued against the defendants and whether a
\npermanent receiver should be appointed is scheduled for March 2, 2009,
\nat 9 a.m. HST.<\/p>\n
The Commodity Futures Trading Commission (CFTC) also filed an
\nemergency action yesterday against BCI and Cooper, alleging violations
\nof the antifraud provisions of the Commodity Exchange Act. The State
\nof Hawaii’s Department of Commerce and Consumer Affairs (DCCA), Office
\nof the Commissioner of Securities, issued a preliminary order to cease
\nand desist against BCI and Cooper.<\/p>\n
The Commission acknowledges the assistance of the Hawaii DCCA’s
\nOffice of the Commissioner of Securities and the assistance of the
\nCFTC in this matter.<\/p>\n
# # #<\/p>\n
For more information, contact:<\/p>\n
Andrew Petillon<\/p>\n
Associate Regional Director, Los Angeles Regional Office<\/p>\n
(323) 965-3214<\/p>\n
Kelly Bowers<\/p>\n
Senior Assistant Regional Director, Los Angeles Regional Office<\/p>\n
(323) 965-3924<\/p>\n
John B. Bulgozdy<\/p>\n
Senior Trial Counsel, Los Angeles Regional Office<\/p>\n
(323) 965-3322<\/p>\n
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From SEC Press Release at http:\/\/www.sec.gov\/news\/press\/2009\/2009-30.htm Securities and Exchange Commission SEC Halts Ponzi Scheme Targeting Deaf Investors FOR IMMEDIATE RELEASE 2009-30 Washington, D.C., Feb. 19, 2009 \u2014 The Securities and Exchange Commission has obtained a court order halting a Ponzi…<\/p>\n