Jeffrey L Gibson and Investment Property Management
The SEC announced a final judgment in their case against Jeffrey Gibson and Investment Property Management. According to the judgment, "The defendants consented to the entry of the judgment without admitting or denying the allegations of the Commission's Complaint. The court ordered the defendants to pay disgorgement in the amount of $427,701.73, and ordered Gibson to pay a civil penalty in the amount of $25,000." (my emphasis)
This case, which I believe is going to be the new wave of business opportunities fraud, was started in August, 2005. At that time, the SEC announced that they had filed a complaint and in it alleged: "from approximately December 2002 through the present, Gibson misappropriated for his personal use approximately $450,000 from investors in American Car Wash Fund, LP ("ACW"), a limited partnership. IPM serves as ACW's general manager. Between December 2002 and April 2003, Gibson, through IPM, sold approximately 43 limited partnership interests in ACW, raising approximately $875,000. Approximately 38 of the limited partners were also clients of his advisory business. Almost as soon as he began selling interests, Gibson began writing checks, payable to cash, on ACW's bank accounts and then misappropriating the funds from those checks for his personal use." The full complaint can be read here.
There is the usual suspects: a) false reporting letters, b) misrepresentations about the safety of the investment, and c) and personal benefits. Why do I believe that business opportunities frauds will be come securitized, that is instead of selling distributorships the con criminals wills sell "units" or "interests" in partnerships or corporations that supposedly hold lucrative distributorship contracts?
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The FTC is moving ahead with its new Business Opportunity Rule. And while I have serious doubts about how the new Business Opportunity Rule will be in deterring scams and frauds, I think that you call sell the securitization of the biz op relatively quickly with less upfront investment - apparently, all you need is a registered representative and some fake reporting letters.
Technorati Tags: limited partnership, final judgment, gibson, acw, investment property management, partnership interests, ipm, sec, car wash, american car, court ordered, new wave, allegations, business opportunities, fraud