SEC Charges Three in Assured Capital High Yield Investment Scam

Manipulative Trading - Investment Scam - Securities Lawyer 101
Securities Lawyer 101 Blog

On September 20, 2013, the Securities and Exchange Commission (“SEC”) charged Jennifer Hoffman and John Boschert, former principals of a dissolved Florida company called Assured Capital Consultants, LLC, and Bryan Zuzga, Assured’s purported escrow agent, in connection with a prime bank offering and a Ponzi scheme.

Prime bank offerings, also called high yield investment programs (“HYIPs”), are a form of fraud with a long history.  Scammers seek to impress their targets by explaining that they deal in very sophisticated and complex financial instruments unknown to most people.  Victims are promised very high interest payments that will be even higher if they allow the interest to compound.

At first, those who opt for monthly payments receive them, which often encourages them to invest more money.  Eventually, the payments stop.  The perpetrators offer a variety of excuses, but in the end the scheme collapses.

In this case, investors were told that their money would be placed in Assured’s offshore, confidential trading program, which would itself invest in large blocks of medium term notes. Hoffman and Boschert assured their victims that the investments were completely safe, even guaranteed.  Potential interest would be as high as 50% weekly.  Excessive as that sounds, believers gave the pair at least $25 million.

As a further incentive, Hoffman sent investors fake bank documents and a “verification letter” notarized by Zuzga, claiming that Assured had $500 million in a Panamanian bank account.

Investors were informed that their money was safe because it was held in Assured Capital’s escrow account, which was run by Zuzga, an attorney.  The money would be used as collateral for a line of credit.  According to the SEC, none of that was true.  Assured Capital had already gone out of business, had no trading account, and Zuzga was not, and had never been, an attorney.

As always, the fraudsters put investors’ money to their own personal use, except for what they needed to make Ponzi payments to those who demanded interest or wanted to withdraw from the scheme.

The SEC has charged Hoffman, Boschert, and Zuzga with violating the antifraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934 for their conduct of the investment scam.  It seeks financial penalties, disgorgement of ill-gotten gains, prejudgment interest, and permanent injunctions.

For further information about Ponzi schemes, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956, by email at [email protected].  This securities law blog post is provided as a general informational service to clients and friends of Hamilton and Associates Law Group, P.A. and should not be construed as, and does not constitute, legal advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed herein do not guarantee similar outcomes.

Hamilton & Associates | Securities Lawyers
Brenda Hamilton, Securities Attorney
101 Plaza Real South, Suite 202 North
Boca Raton, Florida 33432
Telephone: (561) 416-8956
Facsimile: (561) 416-2855