Ponzi scheme operators targeting professional athletes plead guilty

In 2017, the SEC continues its crackdown on Ponzi schemes operators.

On March 1, 2017, William D. Allen and Susan C. Daub, both defendants in a parallel SEC enforcement action, were each sentenced to six years imprisonment.

This is a great result for the defrauded investors, and the SEC, once again, should be commended for cracking down on Ponzi scheme operators.

Having already pled guilty to criminal charges, Allen and Daub were ordered to pay $16.8 million in restitution for their role in an investment scheme involving fraudulent loans to professional athletes.

The SEC continues to litigate against Allen and Dub for violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder. there, the SEC seeks permanent injunctions, disgorgement and prejudgment interest, and civil penalties.

These SEC civil litigations reinforce confidence to enforce fraudulent private placements. Investor strength in numbers may be needed to litigate against Ponzi scheme fraudsters in civil litigations. That’s where the SEC is important, protecting investors and providing an avenue for recoupment of fraudulently lost funds.

Richard Gora has litigated against the SEC, counseled clients in investigations by the SEC, and has represented clients allegedly involved in Ponzi schemes in the hundreds of millions of dollars. Gora LLC is a full-service firm with offices in Stamford, CT, Albany, NY and NY, NY, and provides counsel to clients all over the world ranging from startups to public companies on securities, business, litigation, IP, employment and energy.