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U.S. Securities and Exchange Commission


Litigation Release No. 21881 / March 9, 2011

United States Securities Exchange Commission v. Larry Michael Parrish, Civil Action No. 11-CV-00558-WJM-MJW (D. Colo.) (March 07, 2011).


On March 7, 2011, the SEC filed an injunctive action in the United States District Court for the District of Colorado against Larry Michael Parrish.

The Commission alleges that from about November 2005 through October 2009, Parrish raised approximately $9.2 million from 70 investors in 3 states. Parrish, and his company, IV Capital, solicited investors for his “Trading Program” and promised returns of at least 60% per year. The Commission alleges that investors received monthly payments which Parrish told them were profits from successful trading. However, the majority of funds that came into IV Capital bank accounts were from new investors, not from any actual profit-generating activity. The complaint alleges that Parrish, who had no other employment or legitimate source of income, funded his personal life at the expense of investors, misappropriating at least $780,000 for his personal benefit.

According to the complaint, Parrish told investors in the Trading Program that their money would be held safely in an escrow account, and that the IV Capital traders would use the value of that account, but not the actual funds, to obtain leveraged funds to purchase and sell bank notes. According to Parrish, the trading was profitable enough that he was able to guarantee returns of five percent per month – or 60% per year – to investors. Parrish claimed that he had successfully run the Trading Program since 1996, generated profits every single month of that time, and that he had $22 million under management.

Parrish is a recidivist who was a named defendant in a previous SEC action. In April 2005 the SEC brought an action against Parrish for his involvement in a Prime Bank Scheme, SEC v. Larry Michael Parrish, et al., 05 Civ. 1031 (D. Md., filed April 14, 2005). Parrish was subsequently enjoined from violating securities laws and he also consented to the entry of an administrative order barring him from associating with any broker-dealer with a right to reapply for association after five years. 2007 SEC LEXIS 1031. When asked by investors, Parrish denied he was the same Michael Parrish.

In the current action, the SEC's complaint alleges that Parrish violated Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933, Sections 10(b), 15(a), and 15(b)(6)(B)(i) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206 (1), (2), and (4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder.



Modified: 03/09/2011