SEC Charges Florida Payday Lender, CEO In Relation To $66 Million Fraud Scheme
On September 27th, 2021, the Securities and Exchange Commission (SEC) announced investment fraud charges against Sky Group USA LLC—a Miami, FL-based payday lending business—and its Chief Executive Officer (CEO) Efrain Betancourt, Jr. The company and its lead executive are implicated in a $66 million fraud scheme. Below, our Miami investment fraud lawyers provide a more detailed overview of the investment fraud allegations raised against Sky Group USA LLC.
Sky Group USA Raised $66 Million from More than 500 Different Investors
According to the SEC, Miami-based Sky Group USA raised approximately $66 million from at least 500 different investors between January of 2016 and March of 2020. The investment entity was run by its CEO Efrain Betancourt, Jr. and it primarily targeted potential investors in the South Florida Venezuelan-American community. Though, the suspected fraud had a national and international reach. Investors in nearly 20 states and 20 countries have been linked to Sky Group USA.
Dozens of Unregistered Sales Representatives Pushed Investments
The SEC complaint filed in the United States District Court for the Southern District of Florida alleges that Sky Group USA and its CEO Efrain Betancourt, Jr. retained more than four dozen sales representatives. These unregistered agents solicited investment in the company from members of the public. Notably, Sky Group USA, Mr. Betancourt, Jr., and the team of sales representatives allegedly made false and misleading representations to actual and prospective investors. More specifically, the SEC contends that:
- The Use of Aggressive Unregistered Sales Agent: Sky Group USA told investors that there money would be used solely to make small dollar loans (payday loans) to individuals with poor credit or no credit history;
- Material Misrepresentations in the Marketing Pitch: Sky Group USA told investors that the firm was profitable, and that their money was secure in the form of a promissory note in the company;
- A Ponzi Scheme to Keep the Company Running: Sky Group USA was far from profitable—instead of making the promised loans, the company merely shifted funds around in a manner much like a traditional Ponzi scheme to stay afloat.
The SEC is Seeking All Appropriate Sanctions
Federal regulators are taking enforcement action against Sky Group USA and its CEO Efrain Betancourt, Jr. in order to protect the legal rights and financial interests of investors. Among other things, the SEC is seeking:
- Findings of violations of federal securities law;
- A permanent injunction against Sky Group USA and Mr. Betancourt, Jr.
- Civil financial penalties;
- Payment of prejudgment interest;
- Payment of restitution to affected investors; and
- Other penalties as deemed warranted.
Schedule a Confidential Consultation With a Securities Fraud Lawyer in South Florida
At Carlson & Associates, P.A., our Miami securities fraud & investor losses attorneys have the skills and expertise to help you navigate through the claims process. If you suffered losses in a promissory note investment fraud, we will help you seek compensation. Call us now for a confidential consultation. We provide investment fraud representation in Miami, South Florida, and beyond.
Resource:
sec.gov/news/press-release/2021-196