U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23465 / February 11, 2016
Securities and Exchange Commission v. Jilbert Tahmazian, Civil Action No. 2:16-CV-954 (C.D. Cal. filed Feb. 11, 2016)
SEC Charges California Attorney with Fraud for Engaging in a Prime Bank Scheme
The Securities and Exchange Commission today charged Jilbert Tahmazian, a lawyer licensed in the state of California, with fraud for engaging in a prime bank scheme.
The SEC's complaint, filed in federal court in California, alleges that:
- From at least mid-2009 through at least December 2010, Tahmazian fraudulently obtained approximately $6 million from at least four unsuspecting investors through bogus investment contracts.
- Under the terms of the fraudulent investment contracts, investors were promised that they would receive a return of 15% to 30% per week from their investment. If the investors' money was not invested within 15 to 30 days, they were promised a refund of their investment plus a 2% penalty.
- The funds were deposited in Tahmazian's attorney trust account with the understanding that they would be used to invest in the fraudulent investment contracts.
- However, Tahmazian never invested the investors' funds. Instead Tahmazian retained a substantial fee for himself and transferred the remainder from his trust account to others, who in turn spent it at Las Vegas casinos and high-end retail stores.
The SEC's complaint charges Tahmazian with violations of Section 10(b) of the Exchange Act of 1934 and Rules 10b-5(a) and (c) thereunder, Sections 5(a) and (c) of the Securities Act of 1933 and Sections 17(a)(1) and (3) of the Securities Act.
The SEC's continuing investigation was conducted by Ansu Banerjee and Delane Olson, and supervised by Melissa Hodgman. The litigation will be led by Alfred A. Day.
