International Law

Shelby Dean Martin Ponzi Alleged

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From the SEC Press release on the Shelby Dean Martin ponzi scheme

The Securities and Exchange Commission ("Commission") announced that on March 6, 2009, it filed a Complaint in the United States District Court for the Western District of North Carolina to halt an ongoing Ponzi scheme.

The Complaint was filed against Shelby Dean Martin ("Martin"), D. Martin Enterprises, Inc. ("DM Enterprises") and DM Ventures, LLC ("DM Ventures").

The Complaint alleges that Martin is a resident of Mooresville, North Carolina, and has served as president of DM Enterprises and as the managing member of DM Ventures. 

The Complaint further alleges that DM Enterprises is a North Carolina corporation formed in 1985 that has its principal place of business in Mooresville, North Carolina.

The Complaint also alleges that DM Ventures is an entity that was formerly registered in the State of Nevada as a limited liability company with its principal place of business in Mooresville, NC.

The Complaint alleges that since at least 1998, Martin, operating through DM Enterprises and DM Ventures, has raised more than $10 million from over 150 investors in North Carolina and in several other states through a variety of false and misleading statements.

The Complaint alleges that Martin told most of his investors that he was going to invest their funds in private companies that he would take public, and told other investors that their money would be used to provide working capital to companies in financial trouble.

According to the Complaint, Martin told investors that they would not lose their principal investment and that they would receive anywhere from a 15% to 50% rate of return on their investment.

Further, the Complaint alleges that Martin personally guaranteed the promissory notes he gave investors and, in several instances, told investors that their principal was insured.

The Complaint alleges that Martin did not invest the money in companies as he claimed, but instead pooled investor funds in the bank accounts of DM Enterprises and DM Ventures, and used those funds as they were received from later investors to pay Ponzi returns to earlier investors.

Full post as published by Misleading Advertising Law on March 06, 2009 (boomark / email).