Borland Capital Group Charged by SEC – Securities Attorneys
On May 16, 2018, the Securities and Exchange Commission (“SEC”) charged the owner of a Manhattan-based alternative investment firm with misappropriating close to $6 million in investor funds reserved to finance the construction of an international airport in Belize.
The SEC complaint alleges that from 2014 through 2017, Brent Borland, the owner of a Manhattan-based alternative investment firm, sold more than $21 million of promissory notes to at least 44 investors in eight different states, and guaranteed that the funds will be used for financing the development of an international airport in Placencia, Belize, and that the investment would be safe guarded by pledges of real estate as collateral. Borland marketed and sold the notes through two companies, Borland Capital Group LLC, which is active in “alternative investment,” and Fund I, LLC, which is said to be in the business of construction finance. In addition, Boland used millions of investor funds for personal expenses and unrelated business expenses, including mortgage and property tax payments on his family’s Florida mansion, luxury automobiles, private school tuition for his children, $36,000 for his family’s beach club membership, and almost $2.7 million to pay off personal credit card debt. Borland allegedly duped investors by pledging the same collateral to multiple investors.
“Investors should be able to count on the fact that their invested funds are used as promised. We obtained an asset freeze and immediate injunctive relief in this case to protect victims from alleged false promises.” said Robert J. Burson, Associate Regional Director of the SEC’s Chicago Regional Office.
As a result, the SEC charges Borland, Borland Capital Group, and Belize Infrastructure Fund with violating the anti-fraud provisions of the federal securities laws. The SEC seeks disgorgement, asset freezes, an accounting of investor assets, and civil penalties. The complaint further goes on to name as relief defendants Borland’s wife, Alana LaTorra Borland, and a corporation owned by Borland and his wife, Canyon Acquisitions, LLC. The SEC seeks to recover investor proceeds that Borland transferred to him and his wife. Similarly, the U.S. Attorney’s Office for the Southern District of New York announced criminal charges against Borland and arrested him the same day. The SEC’s investigation is ongoing.
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 or by email at [email protected]. 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.