U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 21744 / November 16, 2010

SEC v. Scott M. Ross, Civil Action No. 1:09-cv-00683 (N.D. Ill.) (Zagel, J.)

The Securities and Exchange Commission ("Commission") announced that on November 2, 2010, the United States Attorney's Office for the Northern District of Illinois filed a criminal information against Scott M. Ross, charging him with 3 counts of mail fraud in connection with his role in an investment fraud scheme.  U.S. v. Scott M. Ross, Criminal Action No. 10-cr-0925 (N.D. Ill.).  Ross is accused of misusing money he raised from investors for his own benefit - including paying himself a $319,000 salary and purchasing a $70,000-per-year sky box at the stadium of the Indianapolis Colts - and also to make Ponzi-type payments to certain investors.

Previously, on February 3, 2009, the Commission filed a civil injunctive complaint against Ross based upon admissions Ross made to the Commission's staff.  The Commission's complaint alleged that, after raising at least $10 million from approximately 300 investors, Ross misappropriated investors' money, took undisclosed commissions, and used investors' money from one fund to pay returns to investors in another fund.  On the same day that the Commission sued Ross, the Court entered a Partial Final Judgment and Order of Permanent Injunction, Asset Freeze and Other Relief, which permanently enjoined Ross from future violations of Sections 17(a)(1), 17(a)(2), and 17(a)(3) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. SEC v. Scott M. Ross, Civil Action No. 1:09-cv-00683 (N.D. Ill.) (Zagel, J.)

 
http://www.sec.gov/litigation/litreleases/2010/lr21744.htm

Last modified: 11/17/2010