Securities Law Blog

What do sandwiches in a can, greeting card sentiments on rose petals, and a film about the Pinewood Derby all have in common? They were all ideas allegedly invested in by Utah money manager Travis L. Wright with $145 million of investor money.

The Securities and Exchange Commission (SEC) filed a lawsuit against Wright on July 1, 2010 in federal court in Salt Lake City, Utah. The SEC claimed that between 2001 and 2009 Wright misused $139 million of the $145 million raised from over 175 investors by selling notes issued by his Waterford Loan Fund LLC.

Wright allegedly told investors that their money would be used for loans secured by commercial real estate and promised returns of up to 24%.

Instead Wright purportedly used the money to invest in Candwich development of canned sandwiches to be sold in vending machines. The concept has been patented by the president of Mark One Foods, Mark Kirkland, who reported that Wright promised full financial backing for Candwich production.

Wright’s other business investments allegedly included an investment company he owned with his brother to distribute a film about the Pinewood Derby, companies that sell watches online, and rose petals that carry printed greeting card sentiments. The SEC also claims that some of the money raised went towards loans to friends and a lavish lifestyle for Wright and his family.

Investors confronted Wright after they stopped receiving interest payments.

The SEC is seeking to recover ill-gotten gains, impose civil fines and a ban on Wright selling securities.