Southern Financial Group, Inc.
On May 24, 2002, the SEC obtained temporary restraining orders and asset freezes against Southern Financial Group, Inc. a registered broker-dealer, Atlantic Securities Exchange, Inc., its parent company, and all affiliated companies, as well as Richard M. Wooten and Charles Dennis McKittrick, the firm's principals, and Gerald F. Hunter, Jr., a Southern salesman, in connection with a Ponzi scheme. The SEC alleged that the defendants fraudulently raised at least $25 million through the offerings of notes and debentures and used funds from new offerings to pay principal and interest to earlier investors. The SEC also alleged that the defendants illegally transferred approximately $5.3 million of the proceeds from the offering to Springdale Investments, Inc., an entity controlled by Wooten and McKittrick. For more information about the SEC's action, you can read Litigation Release No. 17535 (May 28, 2002).
The Court has appointed Christian R. Stormer as Receiver to take control of the above entities and to collect their assets. The Receiver has set up a website that includes a letter to investors and creditors and how they can contact the Receiver.