(HedgeCo.Net) The United States Securities and Exchange Commission has announced charges against Black Lion Investment Partners, Inc., a Wyoming corporation now based in Georgia, Edward L. Wooten of Macon, Georgia, Lee S. Rose of Deerfield, Illinois, and John L. Krcil of Hanover, Minnesota for defrauding investors out of more than $3 million through a prime bank scheme.
The lawsuit, filed in the U.S. District Court for the Middle District of Georgia, alleges that Wooten, Rose, and Krcil, acting on behalf of Black Lion, misled investors about the nature and safety of investments being offered by promising that their funds would remain in a purported escrow account and earn lucrative returns without any risk of loss. In reality, as alleged in the complaint, the defendants fraudulently transferred investors’ funds out of the purported escrow account and into accounts controlled by Black Lion, Wooten, Rose, and Krcil. According to the complaint, the defendants then used investor funds for personal expenses or to return funds to earlier investors.
The SEC’s complaint charges Black Lion, Wooten, Rose, and Krcil with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties.