U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23464 / February 11, 2016
Securities and Exchange Commission v. Optimum Income Property, LLC, Optimum Property Investments, LLC, and Frank E. Lleras, Civil Action No. 3:16-cv-00073-GCM (W.D.N.C. filed Feb. 10, 2016)
SEC Charges Charlotte, North Carolina, Resident with Fraudulent Investment Scheme Involving the Purchase of Rental Properties
On February 10, 2016, the Securities and Exchange Commission charged Frank E. Lleras and two Charlotte, North Carolina-based companies that he controls, Optimum Income Property, LLC and Optimum Property Investments, LLC, with conducting an offering fraud lasting more than two years that raised more than $2.9 million from at least twenty-five investors from the Dominican Republic.
In a parallel action, the U.S. Attorney's Office for the Western District of North Carolina announced that Lleras has pled guilty to securities and wire fraud.
The SEC's complaint, filed in federal court in North Carolina, alleges that:
- Lleras solicited money from investors by misrepresenting that he would use the funds he obtained to purchase residential homes and condominiums located in Charlotte.
- Lleras misrepresented to investors that he would renovate and resell, or rent, the properties he purchased for substantial profit and take as his fee a percentage of the investors' net profit.
- Lleras's claims to investors were false because he only used a small portion of investor funds to purchase properties and misappropriated large portions of those funds for his own benefit.
- Lleras concealed his scheme by giving investors fake documents, including forged deeds and fictitious property tax receipts, concerning properties that he falsely told them they owned when, in fact, the properties were not owned by the investors.
The SEC's complaint charges Lleras and his two companies with violating 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.
The SEC would like to thank the U.S. Attorney's Office for the Western District of North Carolina for its substantial assistance in this matter.
The SEC's investigation is continuing.
