On June 29, 2020, the U.S. District Court for the District of Colorado entered final consent judgments against Merlyn Curt Geisler and Marshall D. Gunn, Jr., in connection with their roles in a prime bank scheme orchestrated by Daniel Dirk Coddington. The court also dismissed the SEC's claims against Coddington, who passed away in January 2019, as well as several entities that are now defunct.

The SEC's complaint, filed on December 12, 2013, alleges that Coddington defrauded investors by soliciting investments in Collateralized Mortgage Obligations (CMOs). Specifically, the complaint alleges that Coddington told investors that he would pledge the CMOs as collateral for loans, and then use the loan proceeds in a year-long trading program that would generate profits ranging from 250% to 475%. The complaint further alleges that the trading program did not exist, and that Coddington and others misappropriated the majority of investor money. According to the SEC's complaint, Geisler and Gunn made false and misleading statements about the trading program to solicit investors and received hundreds of thousands of dollars for their efforts.

Geisler and Gunn consented to entry of final judgments without admitting or denying the allegations of the complaint, and agreed to be permanently enjoined from future violations of the antifraud provisions of Section 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and the securities registration provisions of Sections 5(a) and (c) of the Securities Act and the broker-dealer registration provision of Section 15(a) of the Exchange Act. Geisler agreed to pay disgorgement of $653,000, prejudgment interest of $111,604 and a civil penalty of $150,000. Gunn agreed to pay disgorgement of $197,500, prejudgment interest of $33,754 and a civil penalty of $50,000.

The SEC also sought, and the Court granted, dismissal of its claims against Coddington and the entities that he used to perpetrate the fraud, Golden Summit Investors Group Ltd. and Extreme Capital Ltd., and the entities that Geisler and Gunn used to solicit investments, SouthCom Management LLC, Fidelity Asset Services Corp. and Geisco FNF, LLC.

The Commission's civil case is continuing against Jesse W. Erwin, Jr., Seth A. Leyton, Lewis P. Malouf, Stonerock Capital Group LLC, Daniel Scott Coddington, Coddington Family Trust, and Joanna I. Columbia.

The litigation is led by Leslie J. Hughes and Stephen C. McKenna, and supervised by Gregory A. Kasper.