Securities and Exchange Commission v. Edmund E. Wilson and Walter L. Ross, Civil Action No. 2:13-cv-00188-PWM
SEC CHARGES EDMUND E. WILSON AND WALTER L. ROSS WITH VIOLATIONS OF THE FEDERAL SECURITIES LAWS
Recently, the Securities and Exchange Commission filed a civil injunctive action against Edmund E. Wilson (Wilson) and Walter L. Ross (Ross), alleging that Wilson and Ross violated the federal securities laws in connection with the sale of securities by Fountain Group of Companies of Utah, Inc. (Fountain Group).
In its Complaint, filed in the U.S. District Court for the District of Utah, the Commission alleges that Wilson raised approximately $11 million from at least 60 investors through the fraudulent and unregistered sale of securities in Fountain Group. The Complaint alleges that beginning in September 2005, Wilson, through his company Fountain Group, offered and sold securities for the stated purpose of providing funding for real estate development. Wilson told investors that for a fee of either $80,000 or $150,000, Fountain Group would leverage a bond backed by senior life settlement policies to generate funding in the tens of millions of dollars for each proposed real estate project. Wilson assured investors their fee would be used to pay expenses to “activate” the funding. Instead of using investors’ funds as represented, Wilson transferred investor funds to other entities he owned and controlled where the funds were spent on expenses related to those businesses. In addition, Wilson used investor funds for his own personal purposes. Wilson was assisted in his solicitation of investors by Ross.
The Commission alleges that by engaging in this conduct Wilson and Ross violated Sections 5(a) and 5(c) Securities Act of 1933 (Securities Act) and Section 15(a) of the Securities Exchange Act of 1934 (Exchange Act) and Wilson violated Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. The complaint seeks a permanent injunction as well as disgorgement, prejudgment interest and a civil penalty from Wilson and Ross.
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