In a recent legal development that has sent shockwaves through the investment community, the U.S. Securities and Exchange Commission (SEC) has filed charges against Brent Seaman and several entities he managed, including Accanito Holdings, LLC, and its various subsidiaries. The case, filed in the U.S. District Court for the Southern District of Florida, alleges fraudulent activities involving an unregistered securities offering that raised approximately $35 million from at least 60 investors. Many of these investors were elderly, retired, and connected to a church where Seaman was active.
The SEC charged Accanito Holdings and Brent Seaman for operating a $35 million Ponzi scheme, specifically targeting church members and violating SEC regulations.
Haselkorn & Thibaut (InvestmentFraudLawyers.com) is investigating Accanito and looking to speak to investors. Please call us for a free consultation at 1-800-856-3352.
Operation of a $35 million Ponzi scheme targeting church members
Table of Contents
Brent Seaman ran a giant trick. He used Accanito Equity to steal $35 million from church people. They were told that they would get big money back. But it was all lies. Brent took their money and spent it on himself.
This is called a Ponzi scheme, a kind of fraud where new money pays old investors until there’s no more money left.
The Charges in Detail
Unregistered Securities Offering
The SEC’s complaint alleges that the defendants violated Section 5 of the Securities Act of 1933, which requires companies to register securities they offer or sell. Registration is crucial as it provides investors with essential information about the company’s management, products, services, and finances.
Targeting Vulnerable Groups
The case gains added significance as it involves targeting vulnerable groups. The investors were primarily elderly, retired individuals who were members of a church where Brent Seaman was an active participant. This raises ethical concerns and adds a layer of complexity to the case.
False Promises and Misrepresentation
The defendants are also charged with violating Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act of 1934, along with Rule 10b-5. These provisions are designed to prevent fraudulent practices in the issuance and trading of securities. Seaman allegedly promised annual returns ranging between 18% and 48%, describing these investments as “safe” and “guaranteed,” which turned out to be false.
Misappropriation of Funds
The complaint further alleges that Seaman misappropriated millions of dollars for personal use, including the purchase of luxury automobiles and trips on private planes. This is a violation of the fiduciary duty that investment managers owe to their investors.
The Ponzi Scheme Element
The SEC’s complaint also highlights that Seaman engaged in Ponzi-like payments to investors. In a Ponzi scheme, returns are paid to earlier investors using the capital of newer investors, rather than from profit earned by the operation of a legitimate business. This unsustainable model eventually leads to the collapse of the scheme, causing significant financial loss for investors.
Legal Consequences and Settlement
The defendants have consented to a bifurcated settlement without admitting or denying the allegations. The terms of the settlement include:
- Injunctions: The defendants will be enjoined from violating the charged provisions of federal securities laws.
- Disgorgement: Relief defendants, including Seaman’s wife, Jana Seaman, and two affiliated entities, have agreed to pay significant amounts in disgorgement and interest.
- Civil Penalties: The court will determine whether it is appropriate to order the defendants to pay civil penalties.
Implications and Takeaways
This case serves as a stark reminder of the risks involved in unregistered securities offerings and the importance of due diligence. It also highlights the SEC’s commitment to protecting investors, especially vulnerable groups, from fraudulent schemes. Investors are advised to be cautious and consult with financial advisors before making investment decisions.
Conclusion
The SEC’s case against Brent Seaman and Accanito Holdings, LLC, is a significant development in the ongoing efforts to combat financial fraud. It underscores the importance of regulatory oversight and the need for investors to be vigilant. As the legal proceedings unfold, this case will undoubtedly serve as a precedent for similar cases in the future.
