SEC Freezes Assets of Denver-Based Group Associated with Alleged $55 Million Ponzi Scheme
Litigation Release No. 24216 / July 26, 2018
Securities and Exchange Commission v. Rudden, et al., No. 18-cv-01842 (D. Colo. filed July 19, 2018)
The Securities and Exchange Commission today announced the unsealing of fraud charges against a group of companies and their principal who allegedly bilked at least 150 investors in a $55 million Ponzi scheme. The SEC obtained an emergency asset freeze and other relief.
According to the SEC's complaint, Daniel B. Rudden and a group of companies operating under the name Financial Visions, which issued promissory notes to fund its operations in short-term financing for funeral services and related expenses, defrauded as many as 150 investors after promising them annual returns of 12% or more. The complaint alleges that since 2010 or 2011, Rudden used new investor funds to pay interest and redemptions to existing investors and concealed the Financial Visions companies' true financial performance and condition. The complaint also alleges that Rudden continued to represent the business as successful to existing and prospective investors when he knew that he was running a Ponzi scheme.
The SEC's complaint, filed under seal in federal court in Denver, Colorado on July 20, 2018, and unsealed yesterday, charges Rudden and the Financial Visions companies with violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Exchange Act of 1934 and Rule 10b-5 thereunder, and seeks permanent injunctions, disgorgement plus prejudgment interest, and penalties. The SEC also named three entities as relief defendants, which the SEC alleges were controlled by Rudden and received investor funds from the alleged Ponzi scheme.
The SEC's continuing investigation is being conducted by Marc D. Ricchiute and Michael D. Hoke of the Denver Regional Office and is being supervised by Jason J. Burt. The litigation will be handled by Nicholas P. Heinke and Mark L. Williams, and supervised by Gregory Kasper. The SEC appreciates the assistance of the Colorado Division of Securities.
The SEC strongly encourages investors to check the backgrounds of people selling them investments by using the search tool on the agency's Investor.gov website to quickly identify whether they are registered professionals. The SEC also encourages victims of the alleged Ponzi scheme to contact email@example.com.