Thomas J. Caufield, an investment advisor and the owner of and a Dallas-based investment education franchise, is now barred by the Securities and Exchange Commission. The regulator recently charged Caufield with investor fraud, accusing him of lying to over 30 investors in a $6.8M offering fraud.
According to the SEC, from at least early 2013 through December 2017, Caufield, who is from Colleyville, Texas, promised investors substantial returns if they invested in the high-yield promissory notes for what he touted was a profitable franchise. He claimed that their money would go toward acquiring and running a franchise that would provide education programs. Instead, Caufield allegedly use a substantial portion of the over $6M in investor funds pay back earlier investors and take care of overdue franchise fees.
The Texas investment adviser is accused of providing materials with false information and making false pitches to prospective investors, including the franchise’s students and clients of DAT Capital Advisors, which was the investment adviser that Caufield owned and used to be registered in the state. Caufield allegedly did not disclose that the franchise was in poor financial health.
The Commission’s complaint contends that the investment advisor made the investment offerings via entities that he ran and owned. The promissory notes came with a 10-18% yearly return guarantee. The investments were marketed as safe, secure, and “lucrative” when, in fact, they were not even SEC-registered, which they should have been by law.
To settle the regulator’s charges alleging promissory note fraud, but without admitting to or denying them, Caufield will disgorge more than $600K plus $126K of prejudgment interest. He also will pay a $160K penalty.
Texas Man Accused of Running Bogus Financial Services Firm to Pay Nearly $2.8M in Restitution
Caufield is not the only to one recently face Texas investor fraud allegations. The Texas State Securities Board announced that Gabriel Claudio, Jr., who pleaded guilty to theft, money laundering, and other criminal charges after stealing millions of dollars from his clients, is now sentenced to 25 years in state prison. He also must pay almost $2.8M in restitution.
Claudio ran a bogus Corpus Christi-based financial services firm. He was formerly licensed in Texas as an insurance agent and he was registered to sell securities between 1997 and 2002. Yet, after that time, Claudio continued to work with investment clients, including an Alice, TX couple who invested over $2M in indexed annuities, first through his firm and then directly through him. He later admitted to “squandering” their money. He also allegedly defrauded at least nine other clients of $600K when he sold them fraudulent investments.
Claudio spent the investors’ funds on gambling, child support payments, private school fees, home costs, jewelry, luxury cars, a home mortgage, and other expenses.
Texas Investment Fraud Lawyers
Our Texas investor lawyers are here to help investors and their families throughout the in recouping their investment adviser fraud losses. Over the years, Shepherd Smith Edwards and Kantas, LLP has successfully helped thousands of investors, including retail investors, small business owners, retirees, high net worth individual investors, and institutional investors. Contact our investment fraud law firm today to request your free, no obligation, initial case consultation.
South Texas Investment Promoter Gets 25-Year Sentence for Multi-Million-Dollar Fraud, Texas State Securities Board, August 18, 2018
SEC bars Texas adviser for cheating more than 40 investors, InvestmentNews, September 26, 2018
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Another Texas-Based Wells Fargo Broker is Barred by FINRA, September 12, 2018
Dallas, Texas-Based Wells Fargo Broker Expelled by FINRA, August 30, 2018
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