SEC Charges Three California Residents Behind Movie Investment Scam, February 20, 2014, (Litigation Release No. 22929)
According to the complaint (PDF), Samuel Braslau, Rand Chortkoff, and Stuart Rawitt defrauded "investors in a purported multi-million dollar movie project that would supposedly star A-list celebrities and generate exorbitant investment returns." Braslau set up "companies named Mutual Entertainment LLC and Film Shoot LLC to raise funds from investors for the movie project," a film first titled Marcel and later changed to The Smuggler. According to the defendants, investors' funds would go to fund the production costs of the movie. The defendants allegedly claimed "well-known actors ranging from Donald Sutherland to Jean-Claude Van Damme would appear in the movie when in fact [these actors] were never even approached." Braslau, Chortkoff, and Rawitt allegedly spent most of the funds on their own personal expenses, instead of production expenses as promised.
The SEC has charged the defendants with violating various provisions of the Securities Act and Exchange Act and seeks financial penalties and a permanent injunction against them. In a parallel action, criminal charges have been announced against the defendants.
Connecticut-Based Stock Promoter Ordered to Pay Over $9.6 Million in Stock Touting and Scalping Scheme, February 19, 2014, (Litigation Release No. 22928)
Judgments were entered last week against stock promoter Jerry S. Williams and two companies that he controlled, Monk's Den, LLC and First In Awareness, LLC, for allegedly operating "a fraudulent Internet-based stock touting and scalping scheme." According to the SEC, Williams promoted Cascadia Investments, Inc. and Green Oasis, Inc. stock through his companies. Williams failed to disclose to investors that he had been "hired by Cascadia and Green Oasis to promote their stock and had been compensated with millions of free and discounted shares of these stocks." While encouraging investors to buy shares, Williams secretly sold his shares, making a profit of over $2.3 million.
The defendants have consented to the entry of the final judgments which enjoin them from future violations of securities laws, order them to pay over $9.6 million in disgorgement, prejudgment interest, and penalties, and impose a penny stock bar against Williams.
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