U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 19195 / April 20, 2005
SEC v. Amit Mathur, et al., (United States District Court for the District of Massachusetts, C.A. No. 05-10729MLW, filed April 12, 2005)
Commission Obtains Preliminary Injunction and Asset Freeze Against Massachusetts Investment Adviser Accused of Misappropriating Millions from Clients
The Commission announced today that the Massachusetts federal district court entered a preliminary injunction and asset freeze on April 19, 2005 against defendants Amit Mathur and Entrust Capital Management, Inc., Mathur's Worcester, Massachusetts-based investment advisory firm, and an asset freeze against another Mathur-controlled entity, relief defendant, AMR Realty, LLC, in connection with a fraud action filed by the Commission. The court's entry of preliminary injunction, which was consented to by the defendants, prohibits Mathur and Entrust, from engaging in future violations of the antifraud provisions of the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Advisers Act of 1940 pending the resolution of the Commission's action.
The Commission's complaint, filed on April 12, 2005, alleges that beginning in September 2001, Entrust, through Mathur, raised almost $16 million from approximately fifteen investors. The complaint alleges, however, that Entrust and Mathur dissipated nearly all of their clients' assets through undisclosed trading losses in Entrust's brokerage account, unauthorized use of investor funds to support Entrust's operating expenses, and blatant misappropriation of client funds for personal use. The Commission's complaint also alleges that Entrust and Mathur transferred at least $1 million in investor funds to AMR Realty. The Commission alleges AMR Realty has no legitimate interest in those funds and that it should not be allowed to retain them. The Court entered a temporary restraining order and asset freeze against Mathur and Entrust and an asset freeze against AMR Realty on April 12, 2005.
For more information see Litigation Release No. 19181 (April 13, 2005).