Court Enters Final Judgment Against Geoffrey H. Lunn for Role in Elaborate Investment Hoax
Litigation Release No. 24043 / February 12, 2018
Securities and Exchange Commission v. Geoffrey H. Lunn, et al., No. 12-cv-02767 (D. Colo. filed October 18, 2012)
On January 31, 2018, the U.S. District Court for the District of Colorado entered a Final Judgment in a case brought by the Securities and Exchange Commission against Geoffrey H. Lunn for his role in a fraudulent investment scheme that operated under the name of Dresdner Financial, a fictitious financial services company purportedly based in Chicago, Illinois.
The SEC's complaint alleged that between February 2010 and February 2011, Lunn posed as the Vice-President of Dresdner Financial and misappropriated more than $5 million from at least 70 investors located throughout the United States and several foreign countries by promising 100% guaranteed investment returns. In reality, Dresdner Financial was an elaborate hoax and Lunn did not invest any of the funds. He instead gave $848,500 to three Las Vegas call girls, withdrew over $1 million in cash and money transfers, made a $1 million Ponzi-like payment to a favored investor, paid over $1.3 million to individuals who helped market the fraudulent scheme, and used the remaining funds to pay for personal and business expenses.
The Final Judgment permanently enjoins Lunn from violating Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder; Section 15(a) of the Exchange Act; Section 17(a) of the Securities Act of 1933 ("Securities Act"); and Sections 5(a) and 5(c) of the Securities Act. The Final Judgment further requires Lunn to pay disgorgement in the amount of $5,466,840, prejudgment interest in the amount of $478,648, and a civil monetary penalty of $5,466,840.
On August 1, 2013, the Court previously entered a consent judgment against Lunn, permanently enjoining him from committing future violations of the federal securities laws. In a parallel criminal action brought by the United States Attorney's Office in Denver, Colorado, Lunn was sentenced to fifty-four months in prison and ordered to pay full restitution to his victims. U.S. v. Lunn, No. 14-cr-00161 (D. Colo. filed on March 26, 2014).
For further information, see Litigation Release No. 22514 (October 18, 2012), Exchange Act Release No. 69998 (July 17, 2013), Exchange Act Release No. 70572 (September 30, 2013), and Exchange Act Release No. 71065 (December 12, 2013).