Recovering Losses caused by Investment Misconduct

SEC Charges Multiple Defendants in Investment Frauds Orchestrated in Massachusetts, Florida, and Indiana

On Sept. 19, the SEC filed an enforcement action against Diane Glatfelter of Billerica, Massachusetts, Robert Rice of Tallahassee, Florida, Robert Anderson of Madison, Indiana, K2 Limited, Inc. and 211 Ventures, LLC alleging that they participated in fraudulent investment schemes that promoted and sold financial instruments, trading programs, and investments that do not - and never did - exist.

The SEC's complaint accuses Glatfelter and Rice, through K2 Unlimited and 211 Ventures, of offering fraudulent venture capital financing and direct investments involving fictitious securities and trading programs since at least 2007. The complaint further alleges that the defendants promised investors that their investments would be guaranteed against loss and would produce sky-high returns.

The defendants allegedly represented that the venture capital financing would be raised through the use of "bank guarantees," which the SEC claims were "non-existent fictional instruments" that defrauded investors out of at least $1.8 million.

Such banking-related investment schemes are prevalent right now, and the SEC has issued a warning to investors advising them to be aware that "fraud artists who promote these schemes often ... seek to mislead investors by suggesting that well regarded and financially sound institutions participate in these bogus programs." In fact, says the SEC, "the world's leading financial institutions" and other banks "have no connection whatsoever" to these types of schemes.

According to the complaint, Anderson became involved in the alleged investment scheme with Glatfelter sometime in 2009, at which point the two allegedly began to offer fraudulent investments to investors through E-Trust Clearing House, KB. The SEC's complaint claims that investors suffered at least $425,000 in losses through the E-Trust scheme.

Investors who wish to learn more about "prime bank" investment frauds similar to the ones allegedly orchestrated by the defendants should read the SEC's overview here.

 

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