Capital Acquisitions, Inc, et al.

U.S. Securities and Exchange Commission
Washington, D.C.

Litigation Release No. 18546 / January 16, 2004

Securities and Exchange Commission v. Capital Acquisitions, Inc, et al., Civil Action No. 2:97-0977B (D. Utah)

U.S. v. Clealon B. Mann, Criminal Action No. 2:02-0741TC (D. Utah)

On January 15, 2004, Clealon B. Mann entered a plea of guilty to conspiracy to commit mail and wire fraud and the sale of unregistered securities in connection with an investment scheme called Capital Acquisitions. The indictment, filed November 26, 2002 by the U.S. Attorney in Salt Lake City, Utah, alleged that Mann and others conspired to solicit and obtain money from investors through misrepresentations, and that the investment program promoted by Mann operated as a Ponzi scheme.

Mann has consented to entry of an injunction in a civil case filed by the Commission concerning the same scheme and a similar scheme called Laser Leasing. The injunction, which was entered by the Court on July 21, 2003, prohibits future violations of the registration and antifraud provisions of the federal securities laws, Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder. The Commission's case and the criminal case alleged that Mann was primarily responsible for selling interests in the Capital Acquisitions program, and raised approximately $24 million from investors nationwide. It was further alleged that Mann represented to investors that the money would be used to finance acquisition of properties to produce oil and gas, but instead Mann used most of the investor proceeds to make interest payments to earlier investors and to finance other ventures that Mann or co-defendant Peter J. Buffo controlled. Buffo previously pleaded guilty to criminal charges and consented to a permanent injunction involving the same scheme.

The Commission assisted the United States Attorney's office in the investigation that led to the indictment of Mann. Sentencing in the criminal case is scheduled for April 15, 2004.

For further information on this case, see Litigation releases 17889 (December 10, 2002), 17757 (September 30, 2002), 16400 (January 5, 2000), 16083 (March 9, 1999), 15868 (September 2, 1998), 15670 (March 13, 1998), and 15601 (December 23, 1997).