SEC Charges Investment Adviser With Misappropriation of Investor Funds in Florida (Ponzi Scheme Case)
In December, the Securities and Exchange Commission (SEC) announced securities fraud charges against a Florida-based investment professional. According to the SEC, Henry Abdo used his company (Titanium Capital LLC) in order to operate a multi-million dollar Ponzi scheme. In total, approximately 160 investors were affected. Within this article, our Miami securities fraud lawyer discusses the allegations in more detail.
SEC Complaint: Titanium Capital and Henry Abdo
The SEC filed a legal complaint against Titanium Capital and its founder Henry Abdo in the U.S. District Court for the Southern District of Florida. Titanium Capital is a Florida-based Limited Liability Company (LLC) that was established in 2014. Mr. Abdo is a national of Lebanon who has multiple residences in Florida. The complaint argues that Titanium Capital is effectively a Ponzi scheme. The SEC contends that Mr. Adbo used the company to fraudulently raise more than $5 million from investors. However, their funds were purportedly shifted around in a “Ponzi-like” manner to keep the scheme afloat. The SEC has already identified more than 160 retail investors—many in Florida, but also many from other states—who were affected by the fraud.
Investors Were Promised Secure, Above-Market Returns
As noted previously, the SEC argues that Titanium Capital LLC was effectively operated as a Ponzi scheme. Through the company, Mr. Abdo promoted an investment option called a “multi Currency Investment Fund” to retail investors in Florida and in other jurisdictions.
Within the investment materials that were promoted to actual and prospective investors, Mr. Abdo claimed that the fund was backed by a proprietary currency exchange. Investors were also informed that the fund was consistently profitable. Investors were promised safe, secure, and above-market returns—with expected annual returns of up to 102 percent.
The SEC asserts that neither Titanium nor its securities are properly registered. Beyond that, the SEC outright doubts the existence of the currency exchange. Instead, it alleges that Titanium Capital LLC is a Ponzi scheme. The SEC believes that Mr. Abdo was siphoning off a significant amount of investor funds for personal expenses.
The SEC is Seeking All Appropriate Legal Remedies
As part of its civil complaint, the SEC is seeking all appropriate legal remedies against Titanium Capital and its founder Henry Abdo. Along with other things, the federal agency is seeking immediate injunctive relief, disgorgement of all ill-gotten gains, and the imposition of civil financial penalties. Notably, there is also a concurrent criminal complaint being pursued against Mr. Abdo being pursued by the U.S. Attorney’s Office for the Southern District of Florida.
Contact Our South Florida Securities Fraud Attorney Today
At Carlson & Associates, P.A., we are a law firm that specializes in protecting the legal rights and financial interests of investors. If you or your loved one was the victim of misappropriation of funds by a financial adviser, please do not hesitate to contact us at our Miami law office for immediate help. Initial consultations are always strictly confidential and carry no obligations.
Source:
sec.gov/litigation/litreleases/lr-25912