U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 20865 / January 23, 2009
SEC v. Gregg Thomas Rennie, 09-CV-10107 -DPW (D. Mass.)
SEC SUES MASSACHUSETTS BROKER FOR FRAUD AND OBTAINS EMERGENCY RESTRAINING ORDER AND ASSET FREEZE
On January 23, 2009, the Securities and Exchange Commission filed an emergency civil enforcement action in U.S. District Court in Boston alleging fraud by Gregg Rennie of Quincy, Massachusetts. That same day, the District Court granted the Commission's request for a temporary restraining order, asset freeze, and other relief. The defendant consented to the emergency relief requested by the Commission.
The Commission's filing alleges that, from early 2007 through the present, while working at an insurance and financial services agency in Providence and acting as an investment adviser, Rennie defrauded numerous clients in Massachusetts and New Hampshire of at least $2 million. According to the Commission's complaint, Rennie told his clients that their money would be invested in risk-free "federal housing certificates" that paid up to 12% per year, tax free, and were offered by a real estate investment company based in Boston. In fact, however, the complaint alleges that the investments were completely fictitious and that Rennie had no relationship with the real estate investment company whose name he used. According to the Commission's filings, Rennie defrauded clients who were elderly, including an 89 year old man. The filings allege that Rennie induced some clients to cash out their investments in annuities, incurring substantial surrender charges, in order to invest in his fraudulent program. According to the complaint, Rennie used investor proceeds to pay personal expenses, including a gym membership and liquor, grocery, shoe and department store purchases, and withdrew thousands of dollars in cash from the account where investor funds were sent.
In addition to restraining the defendants from violating Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933; Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder; and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940, the District Court's order, entered by the Honorable Douglas P. Woodlock, freezes the defendants' assets. The order also prohibits defendant from soliciting, accepting, or depositing any money from investors and requires him to provide an accounting for investor funds.
The Commission brought this action in collaboration with the Massachusetts Securities Division, which today filed an administrative action seeking immediate suspension and subsequent revocation of Rennie's Massachusetts broker-dealer agent registration.
The Commission's complaint charges Rennie with violating Sections 5(a), 5(c), and 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Advisers Act. In addition to the emergency relief, the Commission seeks a preliminary injunction, a permanent injunction, disgorgement, and civil penalties.
The Commission acknowledges the assistance provided by the Financial Industry Regulatory Authority in this matter.