U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21043 / May 18, 2009
Securities and Exchange Commission v. Gregg Thomas Rennie, Civil Action No. 09-CV-10107 -DPW, United States District Court for the District of Massachusetts
SEC OBTAINS DEFAULT JUDGMENT AGAINST MASSACHUSETTS BROKER FOR SECURITIES FRAUD
The Securities and Exchange Commission ("Commission") announced today that on May 18, 2009, the United States District Court for the District of Massachusetts entered a final judgment by default against Gregg Thomas Rennie of Quincy, Massachusetts. The Commission's emergency action, filed on January 23, 2009, alleged that Rennie, while working at an insurance and financial services agency in Rhode Island and acting as an investment advisor, defrauded numerous clients in Massachusetts and New Hampshire of over $3 million. The final judgment enjoins Rennie from future violations of the securities laws. Additionally, Rennie was ordered to pay disgorgement in the amount of $3,678,377, profits gained as a result of the conduct alleged in the Complaint, prejudgment interest in the amount of $30,653, and a penalty of $500,000.
According to the Commission's complaint, from early 2007 through early 2009, Rennie made misrepresentations to several of his clients about investing their money in risk-free "federal housing certificates" that paid up to 12% per year, tax free, and were offered by a real estate investment company based in Boston. In fact, however, the complaint alleges that the investments were completely fictitious and that Rennie had no relationship with the real estate investment company whose name he used. According to the Commission's filings, Rennie defrauded clients who were elderly, including an 89 year old man. The filings allege that Rennie induced some clients to cash out their investments in annuities, incurring substantial surrender charges, in order to invest in his fraudulent program. According to the complaint, Rennie used investor proceeds to pay personal expenses, including a gym membership and liquor, grocery, shoe and department store purchases, and withdrew thousands of dollars in cash from the account where investor funds were sent.
In addition to ordering Rennie to pay $4,209,030 in disgorgement, prejudgment interest and penalties, the judgment imposes a permanent injunction against the defendant prohibiting him from violating 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; and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940.
The Commission brought this action in collaboration with the Massachusetts Securities Division, which, simultaneously with the filing of the Commission's complaint, filed an administrative action seeking immediate suspension and subsequent revocation of Rennie's Massachusetts broker-dealer agent registration.
The Commission acknowledges the assistance provided by the Financial Industry Regulatory Authority in this matter.