SACRAMENTO, Calif. (AP) The Securities and Exchange Commission on Tuesday froze the accounts of an unlicensed Southern California firm it says took in more than $813 million from more than 5,200 investors as part of ''a fraudulent scheme.''
The SEC alleges the owner of Financial Advisory Consultants, James Paul Lewis Jr., withdrew $3 million from the Orange County firm's accounts even as he was telling clients across the nation they couldn't have their money.
A federal judge on Tuesday granted the SEC's request for a temporary restraining order against Lewis, 57, of Laguna Niguel, freezing his assets and those of his company and its two investment funds.
The SEC filed its complaint against Lewis in federal court Monday.
No criminal charges have been filed, but the FBI says in a search warrant affidavit that it has probable cause to believe Lewis was operating a Ponzi scheme in which early investors were paid with money contributed by later investors.
Lewis refused to honor withdrawal requests from more than 150 investors based on a false claim that the Department of Homeland Security had frozen some of his funds, the SEC alleged.
Lewis has been claiming an average annual return of nearly 20 percent from one fund and 40 percent from the other since 1983, The Associated Press reported earlier this month.
Clients told the AP they were able to periodically withdraw portions of their investments some on a monthly basis until this summer, when Lewis began claiming the Homeland Security freeze.
Lewis has not responded to multiple telephone messages left by the AP over two weeks, nor to letters sent to him. Calls for comment to Lewis' attorney, Douglas J. Pettibone, was not returned Tuesday.
Peninsula Clarion © 2016. All Rights Reserved. | Contact Us