U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 25739 / May 31, 2023
Securities and Exchange Commission v. Chimene Van Gundy, Outstanding Real Estate Solutions, Inc., Michael Trofimoff, Santos Kidd, and Maria Tosta, No. 5:23-cv-700 (W.D. Tex. filed May 31, 2023)
SEC Charges Self-Proclaimed 'Queen of Mobile Homes' and Three Salespeople with Fraud in Mobile Home Investment Scheme
The Securities and Exchange Commission filed today a complaint in the U.S. District Court for the Western District of Texas charging Outstanding Real Estate Solutions, Inc. (ORES), its Chief Executive Officer and founder Chimene Van Gundy, and salespeople Michael Trofimoff, Santos Kidd, and Maria Tosta for their roles in raising approximately $18.5 million from at least 600 investors through a fraudulent mobile home investment scheme.
According to the SEC's complaint, between at least June 2018 and November 2021, Van Gundy, the self-proclaimed "Queen of Mobile Homes," and her company, ORES, raised millions from investors while promising to use the funds to purchase, refurbish, and resell mobile homes. The complaint alleges that Van Gundy and ORES did not actually own hundreds of mobile homes that they claimed ORES purchased with investor funds. Rather than using investor funds as promised, the complaint alleges that Van Gundy and ORES made Ponzi-like payments to existing investors, paid undisclosed sales commissions, and funded Van Gundy's personal expenses. The complaint also alleges that Van Gundy, Trofimoff, Kidd, and Tosta acted as unregistered brokers, and made false and misleading statements or omissions to investors while offering and selling ORES mobile home investments.
The SEC’s complaint charges ORES and Van Gundy with violating the securities-registration provisions of Sections 5(a) and 5(c) of the Securities Act of 1933 (Securities Act). The complaint further charges ORES, Van Gundy, Trofimoff, and Kidd with violating the antifraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder. The complaint also charges Tosta with violating Section 17(a)(3) of the Securities Act, and Van Gundy, Trofimoff, Kidd, and Tosta with violating the broker-registration provisions of Section 15(a) of the Exchange Act. The SEC seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties against all defendants, and an officer-and-director bar against Van Gundy. Without admitting or denying the SEC’s allegations, Tosta has agreed to settle the charges against her, consenting to the entry of a final judgment that orders permanent injunctions, disgorgement and pre-judgement interest totaling $117,917.57, and a civil penalty of $60,000. Tosta’s settlement is subject to court approval.
The SEC's investigation, which is ongoing, was conducted by Kendrack Lewis and Melvin Warren of the SEC's Fort Worth Regional Office, under the supervision of Sarah S. Mallett and Eric R. Werner. The SEC's litigation will be led by Matthew Gulde and supervised by B. David Fraser. The SEC acknowledges the assistance and cooperation of the State of Hawaii Department of Commerce and Consumer Affairs, Securities Enforcement Branch.