SECURITIES AND EXCHANGE COMMISSIONWashington, DC
LITIGATION RELEASE NO. 16892 / February 8, 2001
SEC V. ELFINDEPAN, S.A., SOUTHERN FINANCIAL GROUP, TRACY CALVIN DUNLAP, JR., BARRY LOWE, JAMES L. McCALL, STRATEGIC ASSET FUNDS, S.A., EDMUND MENDEN, MICHAEL MENDEN and MICHAEL ZIEGLMEIER, defendants, and C.R.C.C. LLC and PATRICK WILSON, relief defendants. (USDC Middle District of North Carolina, 1:00CV00742)
COMMISSION AMENDS ELFINDEPAN COMPLAINT TO INCLUDE ADDITIONAL PARTIES AND FRAUDULENT ACTIVITIES
The Securities and Exchange Commission on February 6, 2001 filed an amended complaint in the United States District Court for the Middle District of North Carolina naming additional defendants and relief defendants, alleging violations of Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
James L. McCall, Strategic Asset Funds, S.A., Edmund Menden, Michael Menden and Michael Zieglmeier join Tracy Calvin Dunlap, Jr., Elfindepan, S.A., Southern Financial Group and Barry Lowe as defendants in the action. C.R.C.C. LLC and Patrick Wilson were named as relief defendants.
The amended complaint alleges that McCall, age 67, a retired chiropractor and self-styled "tax consultant" from Lafayette, Indiana, acting on his own and with Dunlap and Elfindepan, misappropriated millions of dollars from innocent investors through a fraudulent investment scheme commonly referred to as a "Prime Bank" scheme.
The amended complaint also alleges that Edmund Menden, age 66, an insurance salesman and registered securities broker, his son Michael Menden, age 42, a former insurance salesman and network/multi-level marketing salesman, and Zieglmeier, age 50, Michael Menden's business partner in their network/multi-level marketing activities, all three from the Minneapolis, Minnesota area, sold the fraudulent investment products of McCall, Dunlap and Elfindepan.
The amended complaint also alleges that Dunlap, acting through Strategic Asset Funds, S.A., incorporated by Dunlap in Panama in May 2000 but with a business address in Statesville, North Carolina, perpetrated over the Internet a variation of his Elfindepan scam. The Commission alleges that Dunlap and Strategic Asset Funds misappropriated over $6.5 million dollars from more than 860 investors across the United States by means of a fraudulent solicitation (guaranteed returns up to 30% monthly for a 12 month return of 360%) offered to the public through an investment website.
The amended complaint also alleges that relief defendants C.R.C.C., a limited liability company registered in Wyoming, with its office in San Diego, California, and Wilson, the control person of C.R.C.C., based in Duluth, Georgia, received $7 million in proceeds of Dunlap and Elfindepan's fraudulent activities and will be unjustly enriched at the expense of innocent investors if allowed to keep these funds.
For more information, please contact Eric N. Miller, Assistant Chief Litigation Counsel, telephone number (202) 942-7275.