The United States Securities and Exchange Commission (SEC) charged former Texas resident, Joshua Thomas Jackson, with defrauding investors through real estate investment schemes resulting in investor losses of approximately $2.4 million.
The SEC enforcement action, filed in the United States District Court for the Eastern District of Texas, charges Jackson with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
The SEC’s complaint alleges Jackson fraudulently sold approximately $2.65 million in promissory notes to 13 investors. Sixteen of the promissory notes were sold for approximately $2.5 million to eleven investors, some of whom purchased multiple notes, and he raised an additional $150,000 from two investors through a promissory note that was never formally executed. Investments ranged from $50,000 to $500,000 and the notes typically provided for repayment of investor funds within 12 months, with annual interest ranging between 10% and 12%. He told investors that their funds would be used either to purchase and renovate residential properties, specific to each investor, or to fund larger real estate development projects, per the SEC’s court filing.
As alleged, in addition to promising to return investors’ principal, Jackson also promised to pay monthly interest on the promissory notes, pay investors a share of the profits of the respective projects, and secure investors’ funds with a security interest in the real property acquired. Although each note purported to be secured by real property “to be determined and mutually agreed upon in writing,” investors were not involved in choosing the homes purchased by Jackson, and only one investor received any documentation purporting to provide a security interest in a specified property.
Jackson allegedly used only a small portion of investors’ funds as represented. Instead, he used a large portion of investors’ funds to renovate properties in which investors had no interest, for his personal benefit and other businesses, and to repay other investors.
The complaint seeks injunctions against future violations of the foregoing provisions, a conduct-based injunction, disgorgement and prejudgment interest and civil money penalties against Jackson.
Nationally acclaimed SEC defense attorney David Chase, Esq. of the Law Firm of David R. Chase, represents individuals throughout the country who are under SEC investigation for various alleged securities law offenses, including insider trading, market manipulation, promissory note fraud and investment advisor violations. If you are under SEC investigation and are in need of strategic advice and counsel from a veteran SEC lawyer, contact David at: 800-760-0912 or e-mail him at: david@davidchaselaw.com. Visit the Firm’s website for more information on SEC investigations at: www.securitiesfrauddefense.net.
