(HedgeCo.Net) The Securities and Exchange Commission has charged Archer Capital Management Group, the Archer Growth Fund, and two related entities, HDR Management LLC and Silvermoon Group LLC, with operating a fraudulent scheme from December 2019 through December 2020 that raised approximately $2.6 million from at least 20 investors by using misrepresentations disseminated via Archer Capital’s website and other internet outlets.
The SEC alleges that the defendants acted through unidentified agents using fraudulent identities to engage in an internet offering fraud. To induce investment in the Archer Growth Fund, the defendants falsely claimed on their website, www.archerfund.com, among other misrepresentations, that the Archer Fund had an annual rate of return of 47%, that it had beaten the Russell Growth Index for five straight years, and that it was “one of the only High-Watermark Funds available on the market.” The SEC also alleges these claims were false. Indeed, the SEC alleges there was no Archer Growth Fund. Investor funds were never invested as promised but instead, the SEC alleges that investor funds were misappropriated by the individuals who orchestrated the scheme for their personal use and to perpetuate the fraud.
The SEC’s complaint, filed in federal court in the Southern District of Florida, charged Archer Capital, the Archer Growth Fund, HDR, and Silvermoon with violations of the Sections 17(a), 5(a), and 5(c) of the Securities Act of 1933 and Section 10(b) and Rule 10b-5 thereunder of the Securities Exchange Act of 1934. The SEC seeks permanent injunctions, disgorgement and prejudgment interest against the defendants.
The SEC’s investigation was conducted by Paulina L. Jerez of the Philadelphia Regional Office and supervised by Kingdon Kase and Scott A. Thompson. The SEC’s litigation is being led by Gregory R. Bockin. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Eastern District of Tennessee, the Federal Bureau of Investigation, and the New Hampshire Bureau of Securities Regulation.