Recently, the U.S. Securities and Exchange Commission (SEC) accused 25-year-old Tyrone Johnny Lacy, Jr. from Seffner, Florida, of executing a fraudulent "no-money-down trading" scheme, leveraging credit provided by certain broker-dealers to purchase over $300,000 worth of securities without having sufficient funds to cover the transactions.

According to the complaint, between October 1, 2022, and October 26, 2022, Lacy induced two broker-dealers to provide instant buying power credit by submitting forged brokerage account applications and false bank account deposits, enabling him to purchase securities. Before his fraudulent deposits were reversed due to insufficient funds in his bank accounts, Lacy allegedly purchased approximately $331,700 worth of securities using the credit provided by the broker-dealers. Lacy purportedly extracted around $1,600 in trading profits from these transactions, causing one of the broker-dealers to suffer approximately $1,500 in losses.

The SEC, in a complaint filed in the U.S. District Court for the Middle District of Florida, accuses Lacy of violating the anti-fraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.

The SEC seeks permanent injunctions against Lacy, conduct-based injunctions, civil penalties, disgorgement of ill-gotten gains, and prejudgment interest.