SEC Cases: Woodbridge Agrees to Pay Legal Fees for Investors Harmed in Alleged $1.2B Ponzi Scam, Hoplon Financial Group is Accused of $2.18M Securities Offering Scheme, and Ticket Reserve Settles Investor Fraud Charges

Woodbridge to Appoint New Board to Run the Property Developer, Will Pay for Investor Fraud Lawyers
Woodbridge Group of Companies and the US Securities and Exchange Commission have come to an agreement that a New Board of Managers will be appointed to oversee the bankrupt property developer. The company, which is accused of running a $1.2B Ponzi scam, will pay for legal representation for its investors that continue to grapple with losses they may have sustained in the alleged fraud. Some 8,400 investors gave their money to Woodbridge.

Woodbridge owner Robert Shapiro is accused of owing over $961M to investors, many of them elderly investors, who purchased securities from the company while under the impression that they’d be guaranteed up to 8% interest. Investors were told that their money would be lent out to companies in exchange for up to 15% interest when, in fact, contends the SEC, these developers were entities that Shapiro himself controlled.

Shapiro, who is accused of taking at least $21M of investors’ funds to pay for his lavish lifestyle, denies the SEC’s allegations.

Under the agreement reached with the SEC, the regulator is no longer asking for a trustee to be appointed by the court and it is withdrawing its request seeking receivership over Woodbridge’s assets.

SEC Files Charges Against Hoplon Financial Group and Its CEO
The SEC filed civil fraud charges accusing Hoplon Financial Group, CEO Daniel B. Vazquez Sr., and ex-COO Gilbert Fluetsch of involvement in a securities offering scam that raised $2.18M from 27 investors. Most of the money came from their victims’ individual retirement accounts.

The regulator’s complaint said that Hoplon, Vazquez, and Fluetsch misused most of investors’ money, including misappropriating about $780K. Their victims thought that they were investing in the Economic Opportunities Fund I, LLC for the purchase of residential properties that would be flipped.

Vazquez was registered as a representative for a brokerage firm and as an investment adviser when the alleged fraud occurred.

Ticket Reserve Inc. Settles Investor Fraud Charges
In district court in Texas, a consent judgement has been entered in the SEC’s fraud case against The Ticket Reserve Inc. The company, its ex-CEO Richard Harmon, former COO John Kaptrosky, and board member Ash Narayan are accused of misappropriating individual investors’ funds—allegedly over $500K by Harmon and more than $2M by Narayan. Kaptrosky is accused of aiding and abbetting.

Harmon and Kaptrosky are accused of not telling investors that The Ticket Reserve was in financial trouble while trying to raise funds from them. Material misrepresentations, backdated documents, and the issuance of Ponzi-like payments were purportedly used to keep the fraud going.

Harmon and Kaptrosky settled the SEC’s case but without denying or admitting to the charges. Harmon will pay $945K. Kaptrosky’s monetary remedies have not been determined yet. Narayan had already settled the SEC’s charges against him.

Please contact Shepherd Smith Edwards and Kantas, LTD LLP if you suspect that your investor losses may be due to securities fraud. We would be happy to offer you a free, no obligation, case assessment.

The SEC Order in the Woodbridge Case (PDF)

The SEC Complaint in the Hoplon Financial Case (PDF)

The SEC Complaint in The Ticket Reserve Inc. Case (PDF)

More Blog Posts:
SEC Orders 235 LLCs to Produce Documents Related to Its Woodbridge Fraud Probe, Stockbroker Fraud Blog, November 5, 2017

FINRA Orders Citigroup to Pay $11.5M, Including at Least $6M to Investors, Over Inaccurate Stock Research Ratings, Stockbroker Fraud Blog, December 29, 2017

Ameriprise Ordered to Pay $8M Over F-Squared Alpha Sector Strategy Sales, Institutional Investor Securities Blog, November 8, 2017