Securities Law Blog

A Colorado grand jury, on March 11, 2008, indicted a Fort Collins man in connection with an alleged investment fraud that netted more than $2.9 million from 26 investors, Attorney General John Suthers announced (Colorado v. Van Vleet). Specifically, prosecutors said, defendant Rick Van Vleet was charged with five counts of securities fraud and two counts of theft over $15,000. If convicted on all charges, Van Vleet could face 84 years in prison and more than $5 million in fines. The indictment alleged that between February 2003 and June 2005, Van Vleet promised investors a high rate of return through an initial investment in music kiosks. The “TouchStand” kiosks, for which investors were charged $10,000 per unit, allowed users to play and download MP3 files for a fee and displayed ads when not on use. Van Vleet allegedly solicited investments ranging from $10,000 to $400,000 while failing to disclose required information to his clients, including the fact he had been enjoined in 1988 from securities violations. Prosecutors also said that while some investor funds were forwarded to Synergy Media Group for kiosk production, Van Vleet deposited a significant portion of the $2.9 million into his personal accounts. All of the money invested remains past due and unpaid, Suthers said. Van Vleet is being held in jail in lieu of $500,000 bond.

For more information on this subject contact securities attorneys, Michaels, Ward & Rabinovitz, LLP.