JustInfo LLC Charged for a Futures Trading Scheme
On October 11, 2017, the Securities and Exchange Commission (“SEC”) announced fraud charges against JustInfo LLC, a Kentucky-based entity, a California-based tax preparer who solicited investors on behalf of the entity, and the entity’s majority owner, for lying to investors in a futures trading scheme.
According to the SEC’s complaint, JustInfo LLC pooled investor funds for the ostensible purpose of trading futures contracts. The complaint alleges that David Weddle, the majority owner of JustInfo, and Scott Allensworth, doing business as Capital Growth Group Associates, raised at least $2.84 million from at least 57 investors by selling investment contracts. The complaint further alleges that throughout the period of the offering, Weddle and Allensworth stole at least $1 million for their own use and to make payments of purported returns to prior investors in classic Ponzi-fashion. Weddle allegedly created false trading reports, which Allensworth sent to investors, to cover up JustInfo’s trading losses and maintain the appearance that the investment was profitable.The SEC’s complaint, filed on October 11, 2017 in the U.S. District Court for the Central District of California, charges JustInfo, Weddle, and Allensworth with violations of Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Without admitting or denying the allegations in the SEC’s complaint, JustInfo and Weddle consented to the entry of final judgments permanently enjoining them from violating the charged sections of the federal securities laws, ordering JustInfo and Weddle to pay $388,322.34 in disgorgement and interest, for which they will be jointly and severally liable, and imposing civil penalties on Weddle and JustInfo of $373,037 and $905,353, respectively. The SEC is litigating against Allensworth.
The U.S. Commodity Futures Trading Commission today announced a parallel action against Scott Allensworth d/b/a Capital Growth Group Associates and Cobra Development Group LLP, Robert J. Fusco, David Weddle, and E-Slate, Inc. d/b/a Cobra Development Group LLP.
For further information about this securities law blog post, 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] or visit www.securitieslawyer101.com. This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance 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.
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