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U.S. Securities and Exchange Commission

U.S. SECURITIES & EXCHANGE COMMISSION

Litigation Release No. 17919 / January 7, 2003

Securities and Exchange Commission v. Dianna Blairtorbett a/k/a Dianna Blair Torbett a/k/a Dianna Blair-Torbett, Individually and d/b/a McMinn Consultants, and McMinn Consultants, Limited, Civil Action No. 1:02-CV-384 (E.D. Tenn.)

SEC SUES PROMOTER IN SECURITIES FRAUD

The Securities and Exchange Commission announced today that it has filed a complaint against Dianna Blairtorbett and McMinn Consultants, Limited ("McMinn") for their actions as promoters in a large multimillion-dollar, prime bank type and other securities fraud. The complaint charges that Blairtorbett, a Tennessee resident and McMinn fraudulently offered and sold unregistered securities by promising extravagant rates of return derived from a variety of investments, including purported prime bank trading programs. The defendants raised approximately $7.7 million from nearly 100 investors in thirteen states and the funds were pooled into accounts owned and controlled by McMinn. The defendants made misrepresentations and omissions of material fact to investors concerning, among other things, the touted risk free nature of McMinn's investments, the use of investor funds, expected returns and the false representation that McMinn's investments were secured by approximately $7 billion in gold and other precious metals. The precious metals did not exist.

The Commission's complaint alleges that Blairtorbett falsely represented that an initial investment of $50,000 would be worth approximately $1.7 million in three years and $22 million in five years, but that she had no basis for these representations. The complaint also alleges that Blairtorbett knowingly or recklessly failed to disclose that a significant percentage of investor funds would be used to pay the "returns" of earlier investors. The defendants also misappropriated investor funds and lulled investors after the investment into believing that they would receive the promised returns, without having a reasonable basis for those representations.

The Commission's complaint charges Blairtorbett and McMinn with violations of the antifraud provisions of Section 17(a) of the Securities Act of 1933 ("Securities Act") and Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder, and with violations of the registration provisions of Sections 5(a) and 5(c) of the Securities Act. The Commission's complaint seeks orders of permanent injunctions, disgorgement of ill-gotten gains along with prejudgment interest, and civil penalties against the defendants.

 

SEC Complaint in this matter

http://www.sec.gov/litigation/litreleases/lr17919.htm

Modified: 01/08/2003