Order Instituting Cease-and-Desist Proceedings, Pursuant to Section 8A of the Securities Act of 1933, Making Findings, and Imposing a Cease-and-Desist Order

ADMINISTRATIVE PROCEEDING
File No. 3-22045

September 3, 2024 –The Securities and Exchange Commission today announced settled charges against Chanon Gordon, in connection with his role in a Ponzi-like scheme conducted by Wilson Baston, a twice convicted felon. On June 23, 2023, the Commission filed a complaint (Baston Complaint) against Baston in the U.S. District Court for the Southern District of New York, charging him with a fraud through which he raised millions of dollars, purportedly to fund real estate investments.

According to the SEC's order, in about March 2017, despite his knowledge that Baston had a criminal history, Gordon agreed to partner with Baston in a real estate venture to flip houses, pursuant to an arrangement by which Baston would handle most aspects of the business and Gordon would allow his name to be used to conduct the business. The order finds that Gordon further allowed Baston to use and exercise control over bank accounts in the name of an entity that he controlled, the Gordon Management Group. The order further finds that, beginning by late 2019, Gordon became aware of red flags that should have alerted him to Baston’s fraudulent conduct, including Baston’s failure to repay investors as promised, but that Gordon did not cut off Baston’s access to the Gordon Management Group bank accounts. According to the order, over the course of Baston’s scheme, beginning about September 2018, Baston received more than $10 million dollars from investors through the Gordon Management Group bank accounts.

The SEC's order finds that Gordon was a cause of Baston’s violations of Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933. Without admitting or denying the order's findings, Chanon Gordon consented to a cease-and-desist order and agreed to pay disgorgement of $8,106 plus prejudgment interest and a civil penalty of $25,000.

The SEC's investigation was conducted by Yitzchok Klug, Mala Bartucci, Daniel Loss and Michael Paley, and was supervised by Tejal Shah, all of the New York Regional Office. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York and the FBI.