local news

SEC moves to stop fraudulent offering of private fund investments

By  | 

Linus Unah – Fourth Estate Contributor

Washington, D.C., United States (4E) – The U.S. Securities and Exchange Commission (SEC) Thursday announced fraud charges and an emergency court order to stop a fraudulent offering of investments in private funds.

The SEC’s complaint, filed under seal in a Dallas federal court, alleged that from Feb. 2015 Patrick O. Howard and two Dallas-based companies he controls — Optimal Economics Capital Partners and Howard Capital Holdings – raised about $13 million from 119 investors through the fraudulent offer and sale of interests in three private funds.

According to the SEC’s complaint, Howard and his companies told investors they would earn between 12 percent and 20 annual returns through investing in these funds.

They also allegedly represented that nearly all investor funds would be used to acquire the interests in the portfolio companies’ revenue streams, and that the promised returns were backed by insurance.

The U.S. regulator further alleged that these representations were false.

According to the SEC, Howard and his companies only used $7.5 million of the $13 million in investor funds to acquire revenue streams from portfolio companies and spent most of the rest on Howard’s personal expenses and on unrelated business expenses.

The SEC also alleged that Howard falsely represented his status as a registered investment adviser.

The federal securities agency is urging investors to check the backgrounds of people selling them investments on its website.

The court has scheduled an additional hearing for Feb. 27.

Article – All Rights Reserved.
Provided by FeedSyndicate

Comments

Show Buttons
Hide Buttons