SEC Charges Former Georgia State Legislator With Defrauding Investors in Ponzi Scheme
FOR IMMEDIATE RELEASE
Washington D.C., July 30, 2020 —
The Securities and Exchange Commission today charged former Georgia state legislator and former member of the Georgia Board of Regents Clarence Dean Alford with defrauding at least 100 investors in his now-bankrupt energy development company, Allied Energy Services LLC.
According to the SEC’s complaint, from 2017 to 2019, Alford fraudulently raised at least $23 million by selling promissory notes to investors – primarily Indian-American professionals – that he guaranteed would provide high annual rates of return. According to the complaint, Alford presented Allied as a successful business when in fact it was struggling, and claimed that investors’ funds would finance energy projects while using most of the funds to make interest payments to earlier investors and for personal expenses, including building a multmillion-dollar home. In 2019, Alford’s alleged scheme collapsed when he failed to make promised interest payments to several investors and then failed to repay the investors’ principal.
“As alleged in our complaint, Alford was a prominent member of the community who misled retail investors for personal gain,” said Justin Jeffries, Associate Regional Director for the SEC’s Atlanta Regional Office. “Investors should be wary whenever they are promised guaranteed, lucrative investment opportunities.”
Without admitting or denying the allegations, Alford consented to entry of a judgment finding that he violated the antifraud provisions of the federal securities laws and ordering permanent and conduct-based injunctions. Alford also agreed that the amounts of civil penalties, disgorgement, and prejudgment interest would be determined by the court at a later date upon motion by the SEC. The proposed judgment is subject to court approval.
Staff in the SEC’s Atlanta Regional Office conducted the investigation and will lead the litigation. The SEC appreciates the assistance of the Georgia Secretary of State’s Securities Division.