Securities Law Blog

Securities regulators on Friday announced charges brought against a broker-dealer in Colorado for misappropriating funds from investors. The Securities and Exchange Commission announced that it has charged David William Thomas and his company, Global Marketing Consultants LLC, with bilking investors through two investment schemes. The SEC claimed that the company raised approximately $6.3 million from more than 140 investors nationwide, by misrepresenting the nature of how the funds were invested. About one-third of the investors were senior citizens according to the SEC.

According to the SEC, Thomas and GMC told clients that investor funds would be pooled into "non-depleting custodial" bank accounts and would be used only as collateral to fund a high-speed internet business and a global positioning system business. He also told investors that the investments were fully insured and would lead to a high rate of return. The complaint filed by the SEC alleges that all of these claims were false, and that Thomas used the money for prime bank trading programs. Thomas has been ordered to pay $4.4 million in restitution and sentenced to 42 months in prison in a related criminal action brought by the U.S. Attorney's Office for the District of Colorado, the SEC said.

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