U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 25865 / September 28, 2023
Securities and Exchange Commission v. Arline E. Woodbury and Joyce L. Holverson, No. 23-cv-14255 (N.D. Ill. filed September 28, 2023)
SEC Charges Illinois and New Jersey Promoters of Multi-Million Dollar CoinDeal Scheme
The Securities and Exchange Commission today charged Arline Woodbury of Ridgewood, New Jersey and Joyce Holverson of River Forest, Illinois for their involvement in a fraudulent investment scheme named CoinDeal that raised millions of dollars through false claims of trillion-dollar returns.
According to the SEC’s complaint filed in the U.S. District Court for the Northern District of Illinois, Woodbury and Holverson served as downstream promoters for the scheme, which claimed investors would generate returns through the imminent sale of an anonymous blockchain technology. The Commission filed a related action in federal court on January 4, 2023 against eight defendants, including Neil Chandran, who allegedly orchestrated the scheme.
The complaint alleges that Woodbury and Holverson formed their own investor groups to take advantage of bonuses and payouts offered through CoinDeal. From at least January 2019, Woodbury and Holverson allegedly raised more than $3 million from hundreds of investors. The complaint alleges that Woodbury and Holverson disseminated materially false and misleading statements to investors about the purported value of the deal, the parties involved in the transaction, the return on investment, and the riskless nature of the investment. According to the complaint, no sale of CoinDeal ever occurred and no distributions were made to CoinDeal investors. The complaint further alleges that Woodbury and Holverson collectively misappropriated hundreds of thousands of dollars of investor funds for personal use.
The SEC’s complaint charges Woodbury and Holverson with violating the registration and antifraud provisions of Sections 5 and 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Woodbury and Holverson were also charged with aiding and abetting certain of Neil Chandran’s violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.
The SEC’s complaint seeks officer and director bars, disgorgement plus pre-judgment interest, penalties, and permanent injunctions against Woodbury and Holverson.
The SEC’s ongoing investigation is being conducted by Dante A. Roldán, Caryn Trombino, Steven Tremaglio, and Lynette Nichols-Newman, and supervised by Anne Graber Blazek, all of the Chicago Regional Office. The litigation will be led by Michael D. Foster, also of the Chicago Regional Office.
The SEC’s Office of Investor Education and Advocacy has issued investor alerts on the red flags of investment fraud.