U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 17936 / January 15, 2003
SECURITIES AND EXCHANGE COMMISSION v. PREMIER MARKETING AND INVESTMENTS, INC. and NICHOLAS ROBLEE a/k/a NICHOLAS RICHMOND, Civil Action No. CV-03-0342 RGK (JTLx) (C.D. Cal.)
The Securities and Exchange Commission ("Commission") announced that on January 15, 2003, the Honorable R. Gary Klausner, United States District Judge for the Central District of California, issued a temporary restraining order halting an ongoing $4.5 million securities fraud by Nicholas Roblee a/k/a Nicholas Richmond ("Richmond"), a 34 year-old resident of Encino, California, and Premier Marketing and Investments, Inc. ("Premier"), an entity controlled by him that has its principal place of business in Los Angeles. The Court: (1) granted the Commission's application for a temporary restraining order; (2) placed a freeze on the defendants' assets; (3) prohibited the destruction of documents by the defendants; (4) ordered accountings from the defendants; and (5) granted expedited discovery.
The Commission's complaint, filed yesterday, alleges that, since November 2000, Richmond and Premier have raised at least $4.5 million from dozens of investors in at least eight states, purportedly for the purpose of investing in a variety of "high-yield" investment programs. The defendants represented that investors could earn returns of up to 200% per month through the programs, which included high-yield promissory notes, bridge loans and the purchase and sale of precious metals. In fact, Richmond and Premier have been operating a "prime-bank" scheme and are misappropriating investor funds and using the funds for, among other things: (1) Richmond's personal expenses, including limousines, armed guards and a down payment on a $1.5 million house in Encino, California; (2) working capital for Premier Pictures, a company owned by Richmond that produced adult films and operated an adult website; (3) other failed business ventures of Richmond, including a forfeited deposit made in connection with the aborted purchase of a male strip club; and (4) the operational costs of maintaining Premier's fraudulent scheme, including office rental and employee salaries. In addition, although investor funds did not generate any income, Richmond and Premier paid purported profits, interest payments and fees to certain individuals in an attempt to perpetuate a Ponzi-like scheme to enable Richmond to continue to raise funds from unwary investors.
The Commission obtained an order temporarily restraining Richmond and Premier from committing securities fraud in violation of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The order also temporarily restrained Richmond and Premier from committing violations of the securities registration provisions of Sections 5(a) and 5(c) of the Securities Act. The Court ordered the temporary restraining order and asset freeze to remain in effect until January 25, 2003 at 1 p.m., pending a hearing on the Commission's motion for a preliminary injunction, which is scheduled for January 23, 2003 at 9 a.m. In addition to the interim relief granted today, the Commission seeks a final judgment against Richmond and Premier enjoining them from future violations of the foregoing registration and antifraud provisions, ordering them to disgorge all ill-gotten gains, and assessing civil penalties against them.
For more information on prime bank fraud, investors are advised to access the Commission's "Prime Bank" investor alert that provides tips on how to avoid being a victim of these scams. The investor alert can be found on the Commission's web site, at www.sec.gov/divisions/enforce/primebank.shtml.