SEC obtains judgments against two individuals involved in multi-million dollar offering fraud

Regulatory news

2024-08-26 09:29:37

2.18W

The SEC has secured final judgments against two individuals involved in multi-million dollar offering fraud.

The Securities and Exchange Commission (SEC) has secured final judgments against two individuals involved in multi-million dollar offering fraud.

On August 21, 2024, the New York Southern District Court entered final judgments against Wayne H. McLean and Joan E. Powell for facilitating a fraudulent scheme to sell purported shares of Eastern Metal Securities (EMS). The SEC previously charged Roger Nils-Karlsson in connection with the EMS scheme that victimized thousands of retail investors worldwide.

According to the SEC’s complaint, filed on March 27, 2023, from on or about November 2012 to June 2019, Karlsson, using various aliases, orchestrated a fraudulent scheme in which he offered and sold EMS shares, purportedly backed by a “Pre Funded Reversed Pension Plan” that he claimed to be the world’s first online investment of its kind.

Karlsson’s scheme was allegedly facilitated by McLean and Powell. McLean allegedly offered and sold EMS securities to investors, by making solicitations through podcasts that made materially false and misleading statements.

As alleged, Powell collected and forwarded investor money to accounts controlled by Karlsson, and McLean and Powell retained a portion of the investment funds for their own personal use despite claiming that they were performing these functions without remuneration.

The final judgments enjoin McLean and Powell from future violations of Sections 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and prohibits them from acting as an officer or director of a public company.

The final judgments also order McLean to pay disgorgement in the amount of $199,179, plus prejudgment interest of $31,436.48, and a civil penalty of $40,000 and order Powell to pay disgorgement in the amount of $39,815, plus prejudgment interest of $6,284.02, and a civil penalty of $25,000.

Maria Nikolova

Maria has been engaged in journalism for more than 17 years, providing Forex industry coverage for the past 10 years. Before joining FNG she was Managing Editor at FinanceFeeds. Prior to that, she worked at LeapRate. Maria has a Philosophy degree from the St. Kliment Ochridski university in Sofia. She has specialized in Cognitive Science in Vienna. Her interests include psychology, AI, and linguistics.