Publicly available records published by the Securities and Exchange Commission (SEC) and accessed on July 31, 2018, as well as an Investment News report published on July 27, 2017 indicate that the SEC has filed charges against a group of companies and their principal in connection with an alleged Ponzi scheme that affected 150 investors.
According to an SEC release, the commission has alleged Daniel Rudden and a group of companies known as Financial Visions defrauded up to 150 investors whom they promised returns of or exceeding 12% on promissory notes issued to fund the company’s operations in “short-term financing for funeral services and related expenses.” The complaint states that “since 2010 or 2011, Rudden used new investor funds to pay interest and redemptions to existing investors and concealed the Financial Visions companies’ true financial performance and condition.” He also allegedly represented the company as successful to current and prospective clients even though he “knew that he was running a Ponzi scheme.”
The SEC’s charges were filed under seal in a Denver, Colorado federal court on July 20th, 2018 and unsealed on July 25th, 2018. Mr. Rudden and Vision companies have been charged with violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC is seeking permanent injunctions, disgorgement, prejudgment interest, and penalties in the pending complaint. It has also named as relief defendants “three entities” which were allegedly controlled by Mr. Rudden and which allegedly received funds from the $55 million scheme.
According to the Denver Post, Mr. Rudden has also been charged with wire fraud in connection to the alleged scheme. A CBS report states that he “confessed to running a Ponzi scheme for the last seven years, costing investors millions,” and turned himself into federal authorities last week.