U.S. Securities & Exchange Commission
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U.S. Securities and Exchange Commission


Litigation Release No. 16459 / February 29, 2000

SEC v. Christopher A. Lowry, et al., D. Minn., Case No. 00-348 (MJD/JGL), filed February 15, 2000

The Commission announced that, on February 15, 2000, the United States District Court for the District of Minnesota issued a Temporary Restraining Order (TRO), temporarily barring Defendants Christopher A. Lowry (Lowry) and Fountainhead Retirement Plan Services, Inc. d/b/a 401(k) University (401(k) University) from violations of the antifraud provisions of the federal securities laws. The TRO also froze the assets of Lowry and 401(k) University. On February 23, 2000, Lowry and 401(k) University agreed to the entry of a preliminary injunction, which continued the relief provided in the TRO.

In its complaint, the Commission alleges that Lowry and 401(k) University raised approximately $488,000 from 14 individuals who purchased stock of 401(k) University. All the investors are located in the Minneapolis/St. Paul area of Minnesota. 401(k) University is a start-up business controlled by Lowry. Lowry raised the money through the sale of 401(k) University stock, claiming that investor proceeds would be used as 401(k) University start-up capital. The Commission alleges that Lowry and 401(k) University misrepresented the use of investor proceeds and misappropriated a significant portion of investor funds. In particular, the Commission alleges that Lowry omitted to tell investors that he was going to use approximately one-third of the proceeds to purchase his personal residence. The Commission alleges in its Complaint that Lowry and 401(k) University violated Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The action is ongoing.