IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF SOUTH CAROLINA
COLUMBIA DIVISION

COMPLAINT FOR INJUNCTIVE AND OTHER RELIEF

The Securities and Exchange Commission ("Commission"), plaintiff in this action, alleges:

SUMMARY

1. This action involves fraudulent, unregistered offers and sales of securities, without an exemption from registration, by defendants Mohamad Elzein, individually and d/b/a Focus Mentors Elzein Management, Hussein El Zein and Darin Knee. From approximately July through October 2001, the defendants raised approximately $541,000 from at least 68 investors in 28 different states and seven foreign countries. In connection with the offering, the defendants made materially false and misleading statements and omissions about, among other things, the safety of the investments and the returns that investors could expect to receive.

2. By engaging in this conduct, the defendants have violated, and unless restrained and enjoined are likely to continue to violate, Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933 ("Securities Act") [15 U.S.C. §§ 77e(a), 77e(c) and 77q(a)] and Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") [15 U.S.C. § 78j(b)] and Rule 10b-5 [17 C.F.R. § 240.10b-5] thereunder. The Commission seeks permanent injunctions, accountings, disgorgement, prejudgment interest and civil monetary penalties against each of the defendants.

JURISDICTION AND VENUE

3. The Commission brings this action pursuant to authority conferred on it by Section 20(b) of the Securities Act [15 U.S.C.§ 77t(b)] and Section 21(d)(1) of the Exchange Act [15 U.S.C. § 78u(d)(1)] to enjoin the defendants from engaging in transactions, acts practices and courses of business alleged in this Complaint, and transactions, acts, practices and courses of business of similar purport and object, for disgorgement of illegally obtained funds and other equitable relief, and for civil money penalties.

4. This Court has jurisdiction over this action pursuant to Section 22(a) of the Securities Act [15 U.S.C. § 77v(a)] and Sections 21(e) and 27 of the Exchange Act [15 U.S.C. §§ 78u(e) and 78aa].

5. The defendants, directly or indirectly, have made use of the mails and the means and instrumentalities of interstate commerce, in connection with the transactions, acts, practices, and courses of business alleged in this Complaint.

6. Venue lies in this Court pursuant to Section 22(a) of the Securities Act [15 U.S.C. § 77v(a)] and Section 27 of the Exchange Act [15 U.S.C. § 78aa], because certain of the transactions, acts, practices and courses of business constituting violations of the Securities Act and Exchange Act have occurred within the District of South Carolina. Among other things, defendants Mohamad Elzein and Hussein El Zein reside and/or resided within the District of South Carolina, and conducted the offer and sales of securities complained of herein from the District of South Carolina. Furthermore, investors in the District of South Carolina have been solicited to purchase, and have purchased securities investments by or through one or more of the defendants.

DEFENDANTS

7. Defendant Mohamad Wael Ibrahim Elzein, individually and d/b/a Focus Mentors Elzein Management, age 42, is a U.S. citizen who resided in Columbia, South Carolina at the time of the conduct set forth herein. Mohamad Elzein began doing business as Focus Mentors Elzein Management and referring to himself as the president of Focus Mentors Elzein Management in 2001. Focus Mentors Elzein Management is not an incorporated entity.

8. Defendant Hussein Hassan El Zein, age 25, is a citizen of Lebanon who resided in Columbia, South Carolina at the time of the conduct alleged herein. Hussein El Zein is Mohamad Elzein's nephew and was the executive assistant of Focus Mentors Elzein Management from July 2001 through approximately December 2001.

9. Defendant Darin Raymond Knee, age 24, is a U. S. citizen who resides in Winter Park, Florida. Knee became involved with Focus Mentors Elzein Management in July 2001 and promoted the investment program on his MoneyJoe.com website and related electronic newsletter called the "Insider's Club."

FACTS

10. Mohamad Elzein, Hussein El Zein and Knee fraudulently offered and sold securities to investors in the form of investment contracts. No registration statement has ever been filed with the Commission in connection with the offers and sales.

11. From approximately July through October 2001, the defendants raised approximately $541,000 from at least 68 investors in 28 states and seven foreign countries.

12. Investor proceeds purportedly were to be combined and used for currency trading and investments in small businesses and real estate.

FOCUS MENTORS' OFFERING DOCUMENTS

13. Focus Mentors offered and sold securities to investors using a "private placement memorandum" that included several documents, most of which were drafted by Hussein El Zein with input from his uncle, Mohamad Elzein.

14. Mohamad Elzein reviewed all of the documents in the private placement memorandum.

15. The offering documents used, variously, all of the following names in describing the entity that was sponsoring the investment: Focus Mentors Elzein Management, FMEM and FMEM International, Inc. (collectively referred to herein as "Focus Mentors"), as well as FEME Focus Enterprises, Inc. ("Focus Enterprises").

16. Focus Enterprises is a Georgia corporation solely owned by another individual. Focus Enterprises' name was used in the offering without the knowledge or consent of its owner.

17. Hussein El Zein gave copies of the private placement memorandum to Knee, who then disseminated the documents to prospective investors by including them in his electronic newsletters and on his website.

18. Knee referred Focus Mentors' investors to the program, via his website and electronic newsletters, and was entitled to commissions for such referrals.

19. Mohamad Elzein and Hussein El Zein met with investors at Focus Mentors' office, spoke with them on the telephone and communicated with them by electronic mail.

20. Investors typically paid a minimum of $5,000 to invest with Focus Mentors and evidenced the investment by signing a Private Contractual Agreement and a Non-Solicitation letter.

21. Virtually all of the Private Contractual Agreements showed Focus Enterprises as the issuer.

22. The Private Contractual Agreement specified that investors would receive a 20% return over a period of three months, with the possibility of leaving the investment with Focus Mentors at the end of the term upon the issuance of another contract.

Focus Mentors' Performance Record and Promised Returns

23. The private placement memorandum contained a track record that showed Focus Mentors' purported performance from 1993 to 2001.

24. The track record falsely represented quarterly returns ranging from 10% to 20%, and some versions of the track record also falsely represented returns based on yearly compounding that ranged from 46% to 107%. There was no reasonable basis for the returns set forth in this track record.

25. The track record also contained an introductory paragraph, drafted by Hussein El Zein, which stated that, "The percentages listed below are the rates of return that the Focus Mentors program has been producing for the past eight years as guaranteed to its investors." This statement was false because Focus Mentors' investment program did not exist prior to 2001 and thus could not have generated the stated returns during that period.

26. The private placement memorandum also falsely stated that the track record had been certified by a public accountant and that certified copies were available upon request. The track record was never certified by a public accountant. Instead, Mohamad Elzein forged an accountant's certification on at least some of the versions of the track record.

27. The track record with the forged certification was given to Hussein El Zein, who photocopied it and sent it to prospective investors who requested it, as well as to Knee.

28. The Private Contractual Agreement that investors were required to sign specified that investors would receive a 20% return over a three-month period. The defendants had no reasonable basis to promise such a return.

"Non-Solicitation of Investors"

29. The offering materials that Focus Mentors sent to investors also contained a Non-Solicitation Letter that investors were to execute and send back to Focus Mentors.

30. The Non-Solicitation Letter required, among other things, that the investors affirm that they had not been solicited by Focus Mentors in any way--even though such a statement was false.

31. The Non-Solicitation Letter also contained a statement that the parties had "mutually agreed" that "this private placement transaction is exempt from the Securities Act."

Description of Focus Mentors and Mohamad Elzein

32. The private placement memorandum contained a summary that described Focus Mentors as a private placement program of Focus Enterprises. The summary used the names of these two entities interchangeably.

33. The summary falsely stated that the Focus Mentors program had been providing investments for clients since 1993, and falsely stated that it had been producing "unparalleled" returns during that period. In fact, the Focus Mentors investment program did not exist until 2001.

34. The summary stated that Focus Mentors was fully insured by Allstate Insurance Company and that the assets of the Company were protected in the unlikely case that Focus Mentors or its executives were to declare bankruptcy. The summary also stated that each client's principal investment was protected in the case of acts of dishonesty. These statements were false, as Focus Mentors had no such insurance.

35. In fact, Allstate Insurance Company contacted Mohammed Elzein in September 2001 and demanded that Allstate's name not be used without authority or permission from Allstate.

36. The summary further stated that Focus Mentors held a diverse portfolio that included, among other things, gold and platinum trading. However, Focus Mentors never engaged in gold and platinum trading.

37. Some versions of the summary falsely stated that Mohamad Elzein had been investing for clients since 1993 and had a "Juries Doctorate" [sic] degree. Mohamad Elzein does not have a law degree or any similar degree, nor had he been investing for clients during the stated period.

38. Some versions of the summary stated that the investment was only available to accredited or sophisticated investors. In fact, sales were not limited to accredited or sophisticated investors.

39. Some versions of the summary stated that Focus Mentors is "filing with the SEC and the department of state securities from exemption." In fact, Focus Mentors had never made any filings with the Commission or with any state securities agency.

PROMOTION OF THE FOCUS MENTORS INVESTMENTS ON
KNEE'S WEBSITE AND IN HIS ELECTRONIC NEWSLETTER

MoneyJoe.com Website

40. During the time of the conduct alleged herein, Knee operated and had sole control over the MoneyJoe.com website, which contained information about various investment opportunities. The website is no longer operational.

41. In July 2001, information about Focus Mentors appeared on Knee's MoneyJoe.com website. The website described Focus Mentors as a "secure opportunity" with "107% plus principal guaranteed." Knee had no reasonable basis for those statements.

42. Knee's website stated falsely that Focus Mentors had been in full operation since 1993. The website also stated that Focus Mentors' owner, Mohamad Elzein, had a Ph.D. in International Affairs. Mohamad Elzein does not have a Ph.D.

43. Knee's website stated that "we" (i.e., MoneyJoe.com and/or Knee) have been involved with Focus Mentors for over four years. This statement was false because the Focus Mentors program had not been in existence for four years, and Knee first learned about Focus Mentors in the summer of 2001.

44. The website also stated falsely that Focus Mentors was a manufacturing company. In fact, Focus Mentors was never a manufacturing company.

45. Knee's website falsely stated that investors were completely protected because Focus Mentors had "millions upon million in of [sic] both physical and capital assets." Focus Mentors never had millions of dollars worth of assets.

46. The website also posted and disseminated to the public the fraudulent track records included in the offering materials, as outlined above.

Electronic Newsletter

47. During the time of the conduct alleged herein, Knee had a periodic, electronic newsletter called "Insiders Club," which featured and recommended various investment opportunities.

48. The electronic newsletter was available to any individual who signed up for it via the MoneyJoe.com website. Access to the website was not restricted, and Knee made no determination as to whether the newsletter subscribers or the website visitors qualified as accredited or sophisticated investors.

49. All copies of the newsletter were transmitted for free by electronic mail.

50. At one time, the Insiders Club newsletter may have had as many as 3,000 subscribers.

51. Visitors to the MoneyJoe.com website were enticed to sign up for the newsletter with statements such as: "We feel our economists are among the best in the world and are working directly for you. Generating 100% to 300% yearly on your investment, or earning a six figure income in your spare time is what our subscribers currently enjoy . . . . Our team of economists do [sic] extensive research and diligence before informing you of an opportunity." In reality, the MoneyJoe.com website had no "team of economists," nor did Knee ever have anyone assist him with his research.

52. In some cases, Knee did no research whatsoever prior to posting programs on his website, despite claims on the website that Knee performed "rock solid research" and was "meticulously cautious" in reviewing an investment.

53. Knee frequently referred to himself as an economist on his website and in his e-mails, at a time when he did not even have an undergraduate degree in economics and had never worked in the field.

54. Knee promoted Focus Mentors in his Insiders Club newsletters, stating in one such letter that "I STRONGLY recommend that you invest yourself as well as become an agent, as this opportunity is honestly the best I've seen in all of my years in the business!"

55. Knee's newsletters contained a number of false statements about Focus Mentors, many of which pertained to the purported high returns and risk-free nature of the investment. Knee had no reasonable basis to make such claims.

56. For example, Knee repeatedly referred to Focus Mentors investments as a "zero risk opportunity" where "your entire principal PLUS 107% Returns are Guaranteed." Knee had no reasonable basis to make such claims.

57. In another newsletter, Knee stated falsely that: [Focus Mentors] "fully Insures and Bonds each and every account opened by private investors such as yourself. We have successfully reduced risk to somewhere around 0% while providing a highly respectable return; 20 Times what any FDIC Insured bank will offer. All compounded returns will be fully insured and bonded along with your principal when they roll over." In fact, the accounts were not insured.

58. In yet another newsletter, Knee stated falsely that: "You are guaranteed the same security that you'll find at a bank, however, it would take you 20 years to make 107% as you will with [Focus Mentors] in only one year. Remember, 107% is the Minimum that you will make, you may easily do much better." In fact, the investments were not guaranteed in any respect by an entity capable of fulfilling the guarantee.

59. Knee also made numerous false claims that Allstate Insurance Company insured Focus Mentors investments against loss. For example, in one newsletter, Knee stated that after extensive background checks, meetings and research into Focus Mentors, Allstate issued a bond covering each individual investor's entire principal investment. On another occasion, Knee claimed that Allstate Insurance Company insures Focus Mentors' funds "against any possible loss REGARDLESS of the reason." Such insurance did not exist.

60. Various other claims about Focus Mentors in Knee's newsletters included statements that the documents and agreements used in the Focus Mentors program had been reviewed by "two government lawyers" and that Focus Mentors was registered with the SEC. Both of these claims were untrue.

61. In some of his newsletters, Knee referred to himself as a "top executive" of Focus Mentors. Knee was never an executive of Focus Mentors.

62. Some of Knee's newsletters also stated falsely that Knee had been following Focus Mentors for over four years--even though the Focus Mentors investment program had not been in existence that long.

63. Although Knee has never invested in Focus Mentors, he nevertheless falsely implied in some of his newsletters that he was a satisfied investor by describing Focus Mentors as his own "personal and private high-yield `bank account'" and his own personal retirement fund.

64. Some of Knee's newsletters have also stated falsely that Focus Mentors was an international company with offices "stretching across the globe."

65. Knee made the misrepresentations above, despite the fact that he did not engage in due diligence on Focus Mentors' track record prior to making such representations to the investors and potential investors.

COUNT I--UNREGISTERED OFFERING OF SECURITIES
Violations of Sections 5(a) and 5(c) of the Securities Act
[15 U.S.C. §§ 77e(a) and 77e(c)]

66. Paragraphs 1 through 65 are hereby realleged and are incorporated herein by reference.

67. No registration statement has been filed or is in effect with the Commission pursuant to the Securities Act and no exemption from registration exists with respect to the Focus Mentors scheme and transactions in such scheme described herein.

68. At various times from at least July 2001 through at least October 2001, the defendants, directly and indirectly, have:

a) made use of the means or instruments of transportation or communication in interstate commerce or of the mails to sell the securities described herein, through the use or medium of any prospectus or otherwise, when a registration statement was not in effect as to such securities;

b) carried securities or caused such securities, as described herein, to be carried through the mails or in interstate commerce, by means or instruments of transportation, for the purpose of sale or for delivery after sale, when a registration statement was not in effect as to such securities; and

c) made use of the means or instruments of transportation or communication in interstate commerce or of the mails to offer to sell or offer to buy, through the use or medium of any prospectus or otherwise, the securities described herein, without a registration statement having been filed as to such securities.

69. These acts include, but are not limited to, the activities described in paragraphs 1 through 65 of this Complaint.

70. By reason of the foregoing, defendants Mohamad Elzein, Hussein El Zein and Knee, directly and indirectly, have violated and, unless enjoined, will continue to violate Sections 5(a) and 5(c) of the Securities Act [15 U.S.C. §§ 77e(a) and 77e(c)].

COUNT II--FRAUD
Violations of Section 17(a)(1) of the Securities Act
[15 U.S.C. § 77q(a)(1)]

71. Paragraphs 1 through 65 are hereby realleged and are incorporated herein by reference.

72. At various times from at least July 2001 through at least October 2001, defendants Mohamad Elzein, Hussein El Zein and Knee, in the offer and sale of the securities described herein, by the use of means and instruments of transportation and communication in interstate commerce and by use of the mails, directly and indirectly, employed devices, schemes and artifices to defraud purchasers of such securities, all as more particularly described above.

73. The defendants knowingly, intentionally, and/or recklessly engaged in the aforementioned devices, schemes and artifices to defraud.

74. In engaging in such conduct, the defendants acted with scienter, that is, with an intent to deceive, manipulate or defraud or with a severe reckless disregard for the truth.

75. By reason of the foregoing, the defendants Mohamad Elzein, Hussein El Zein and Knee, directly and indirectly, have violated and, unless enjoined, will continue to violate Section 17(a)(1) of the Securities Act [15 U.S.C. § 77q(a)(1)].

COUNT III--FRAUD
Violations of Sections 17(a)(2) and 17(a)(3) of the Securities Act
[15 U.S.C. §§ 77q(a)(2) and 77q(a)(3)]

76. Paragraphs 1 through 65 are hereby realleged and are incorporated herein by reference.

77. At various times during the period from at least July 2001 through at least October 2001, defendants Mohamad Elzein, Hussein El Zein and Knee, in the offer and sale of the securities described herein, by use of means and instruments of transportation and communication in interstate commerce and by use of the mails, directly and indirectly:

a) obtained money and property by means of untrue statements of material fact and omissions to state material facts necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; and

b) engaged in transactions, practices and courses of business which would and did operate as a fraud and deceit upon the purchasers of such securities,

all as more particularly described above.

78. By reason of the foregoing, the defendants Mohamad Elzein, Hussein El Zein and Knee, directly and indirectly, have violated and, unless enjoined, will continue to violate Sections 17(a)(2) and 17(a)(3) of the Securities Act [15 U.S.C. §§ 77q(a)(2) and 77q(a)(3)].

COUNT IV--FRAUD
Violations of Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)]
and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5]

79. Paragraphs 1 through 65 are hereby realleged and are incorporated herein by reference.

80. At various times from at least July 2001 through at least October 2001, defendants Mohamad Elzein, Hussein El Zein and Knee, in connection with the purchase and sale of securities described herein, by the use of the means and instrumentalities of interstate commerce and by use of the mails, directly and indirectly:

a) employed devices, schemes, and artifices to defraud;

b) made untrue statements of material facts and omitted to state material facts necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; and

c) engaged in acts, practices, and courses of business which would and did operate as a fraud and deceit upon the purchasers of such securities,

all as more particularly described above.

81. The defendants knowingly, intentionally, and/or recklessly engaged in the aforementioned devices, schemes and artifices to defraud, made untrue statements of material facts and omitted to state material facts, and engaged in fraudulent acts, practices and courses of business. In engaging in such conduct, the defendants acted with scienter, that is, with an intent to deceive, manipulate or defraud or with a severe reckless disregard for the truth.

82. By reason of the foregoing, the defendants, directly and indirectly, have violated and, unless enjoined, will continue to violate Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].

PRAYER FOR RELIEF

WHEREFORE, Plaintiff Commission respectfully prays for:

I.

Findings of Fact and Conclusions of Law pursuant to Rule 52 of the Federal Rules of Civil Procedure, finding that the defendants named herein committed the violations alleged herein.

II.

Permanent injunctions enjoining the defendants, their officers, agents, servants, employees, and attorneys, and those persons in active concert or participation with them who receive actual notice of the order of injunction, by personal service or otherwise, and each of them, whether as principals or as aiders and abettors, from violating, directly or indirectly, Sections 5(a), 5(c) and 17(a) of the Securities Act [15 U.S.C. §§ 77e(a), 77e(c), and 77q(a)] and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 [17 C.F.R. § 240.10b-5] promulgated thereunder.

III.

An order requiring an accounting by the defendants of the receipt of and use of proceeds of the sales of the securities described in this Complaint, as well as the disgorgement of all ill-gotten gains or unjust enrichment. An order which directs the defendants to pay prejudgment interest on disgorgement, to effect the remedial purposes of the federal securities laws.

IV.

An order pursuant to Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. § 78u(d)(3)] imposing civil penalties against the defendants.

V.

COUNSEL FOR PLAINTIFF
Securities and Exchange Commission
3475 Lenox Road, N.E., Suite 1000
Atlanta, Georgia 30326
(404)-842-7612

LOCAL COUNSEL FOR PLAINTIFF
United States Attorney's Office
1441 Main Street, Suite 500
Columbia, South Carolina 29201
(803) 929-3054

http://www.sec.gov/litigation/complaints/comp18324.htm