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News Release Directory


                             Current News Releases                       Archived News Releases 

 

May 21, 2019
Daniel C. Butterfield, AZ Investment Property Experts, LLC and Sandy Beach Esmeralda Development, LLC
The Commission ordered Daniel C. Butterfield of Phoenix and his affiliated companies to pay a total of $27.67 million in restitution and $125,000 in administrative penalties for defrauding investors with promissory notes funding a Mexican real estate project. The Commission found that the companies promoted the real estate investment to at least 136 investors, including through advertisements on a Phoenix-area radio station and with seminars. The Commission found, however, that AZ Investment Property Experts, LLC failed to disclose that it had no ownership interest in the Mexican real estate project. Additionally, the Commission found that Butterfield and his affiliated companies failed to inform investors of the previous revocation of Butterfield’s real estate license in Minnesota based upon fraud allegations and to disclose the risks of promissory notes funding foreign real estate investments. 


In settling this matter, the respondents agreed to the entry of the consent order and admitted to the Commission’s findings only for purposes of the administrative proceeding. For more details on this case, view the full text of the Corporation Commission's order
S-21043A-18-0069.

 

Kyusun Kim
The Arizona Corporation Commission revoked Kyusun Kim’s Arizona securities salesman registration and investment adviser representative license based upon Financial Industry Regulatory Authority’s (FINRA) permanent bar from associating with any FINRA member in any capacity. According to the FINRA order, Kim falsified books and records and made unsuitable recommendations to customers. Kim is a resident of California.


For more details on this case, view the full text of the Commission’s order
S-21068A-18-0417.


April 23, 2019
Roderick Rickert and Titan Capital Real Estate Fund I, LLC
The Commission ordered Gilbert resident Roderick Rickert and his affiliated company to pay restitution and penalties for committing securities fraud in connection with real estate investments. Rickert is required to pay $4,765,771 in restitution and a $50,000 penalty while Titan Capital Real Estate Fund I, LLC is required to pay $3,026,315 and a $50,000 penalty. The Commission found respondents pooled investor funds from 33 people to lend money to real estate developers who were to purchase and “flip” residential properties. Rickert and his company, however, failed to inform investors that one of their key executives, Adam Child, had a prior judgment against him, had declared bankruptcy and had a license revocation of his prior mortgage-lending business. Additionally, the Commission found Rickert and his company co-mingled investor funds with money from other related companies that subsequently spent funds on unsecured development projects and overhead, which led to the failure of the business. In settling this matter, Rickert neither admitted nor denied the Commission’s findings, but agreed to the entry of the consent order. For more details on this case, view the full text of the Commission’s order S-21054A-18-0301.
 
Andrew Gamber, BAIC, Inc. and SoBell Corp
The Commission sanctioned Andrew Gamber of Arkansas and his affiliated companies for selling veterans’ pensions and disability benefits to investors even though federal law expressly prohibits such sales. The Commission ordered Gamber, BAIC, Inc. and SoBell Corp to pay restitution totaling $2,684,099 and administrative penalties totaling $200,000.  Gamber and his affiliated companies were found to have made multiple misrepresentations and omissions to investors, including that Gamber had numerous orders against him and/or his company for insurance and securities law violations. 

 

For more details on this case, view the full text of the Commission order S-21044A-18-0071.
 
Jeremy Diaz, IDIAZ, LLC and Wealth Creator Private Equity, LLC
The Commission ordered former Arizona securities salesman Jeremy Diaz and his affiliated companies to pay $339,521 in restitution and a $90,000 administrative penalty for fraudulently offering and selling unregistered securities and misappropriating the proceeds for personal use. The Commission found respondents Diaz, IDIAZ, LLC and Wealth Creator Private Equity, LLC sold investors a variety of unregistered securities, including investment contracts in oil and foreign currency, promissory notes and limited liability company membership units. Respondents were found to have made false and misleading statements and material omissions during this unlawful, investment sales activity.

 

For more details on this case, view the full text of the Commission’s order S-20983A-16-0299.
 
Joseph J. Carrillo and Partisan Alliance Corporation
The Commission issued a default order against a Phoenix man and his Gilbert-based company for fraudulently selling unregistered promissory notes to investors from the local Hispanic community. The Commission found that respondents Joseph J. Carrillo and Partisan Alliance Corporation misrepresented the investment returns on the promissory notes and failed to tell at least two investors that the company lacked adequate revenues to pay on the notes. The Commission ordered Carrillo and Partisan Alliance Corporation to pay $83,000 in restitution and a $20,000 administrative penalty.

 

For more details on this case, view the full text of the Commission’s order S-21067A-18-0416.  
 
Jennifer Jean Gutschke and JG Enterprise, LLC
The Commission ordered Jennifer Jean Gutschke of Glendale and her affiliated company to pay $14,772 in restitution and a $5,000 administrative penalty for participating in the offer and sale of unregistered securities while not being registered as an Arizona securities salesman or dealer. The Commission found at least 20 investors were promised a return on their initial investment within three to six months, funding either the purchase of leads for prospective businesses that were interested in credit card reader terminals or for the purchase of the terminals that would be subsequently sold to interested businesses. The Commission found, however, that none of the investors received a full return of their original investment, and that Gutschke used some of the money to pay telemarketers for their work soliciting investor funds.

 

In settling this matter, Gutschke and JG Enterprises, LLC neither admitted nor denied the Commission’s findings, but agreed to the entry of the consent order. For more details on this case, view the full text of the Commission’s order S-21059A-18-0345.


March 12, 2019

Thomas P. Madden
The Corporation Commission ordered Thomas P. Madden of Chandler to pay $3,284,792 in restitution and a $75,000 administrative penalty for defrauding at least 79 people in connection with selling them stock in start-up companies. The Commission found that Madden told several people the company stock was bargain priced with likely upward potential while for several yearsthe companies actually had no revenues and large financial losses. Additionally, the Commission found Madden did not disclose to potential investors that prior investors had sued him for selling worthless stock and that he had frequently borrowed money from stock purchasers but failed to repay the loans in full.


Adam Child, Real Estate Finance Corporation, and WIN Opportunity Fund
The Corporation Commission ordered Adam Child of Scottsdale and his affiliated companies to pay a total of $3,6280,565 in restitution and a $40,000 administrative penalty for committing securities fraud in connection with real estate investments. The Corporation Commission found that Real Estate Finance Corporation and WIN Opportunity Fund solicited potential investors through information seminars, cold-calling and social media, but omitted material information that would have allowed investors to evaluate claims of Child's past business success and be informed about Child's previous judgment against him, his declaration of bankruptcy, and the license revocation of his prior mortgage-lending business.

For details on this case, view the full text of the Corporation Commission's order
S-21018A-17-0232.

Titan Funding Group I, LLC and Titan Capital Holding, LLC
The Corporation Commission approved a consent order signed by the court-appointed receiver for Titan Funding Group I, LLC and Titan Capital Holding, LLC, requiring the companies to pay $39,740 in restitution. The restitution amount is what the receiver was able to distribute to the investors. The Commission found the companies raised more than $2.75 million from at least 25 investors, pooling the funds to lend money to real estate developers who were to purchase and "flip" residential properties. However, the Corporation Commission found that Titan Funding Group I, LLC failed to tell investors that its executive, Adam Child, had a previous judgment against him, had declared bankruptcy, and that Child's prior mortgage-lending business had its license revoked. Additionally, the Corporation Commission found Titan Funding Group I, LLC co-mingled funds from related companies that subsequently spent the funds on unsecured development projects and overhead.

For details on this case, view the full text of the Corporation Commission's order
S-21054A-18-0301
.


February 5-6, 2019
Commission Sanctions Multiple Individuals and Companies, including two Lake Havasu CPAs and their company that committed a $2.6 Million Fraud
The Corporation Commission ordered Lake Havasu CPAs Lance Michael Bersch and the late David John Wanzek and their affiliated company, ER Financial & Advisory Services, LLC, to pay $2.6 million in restitution and a total of $816,000 in administrative penalties for fraudulently selling unregistered securities and registration violations. Also, the Corporation Commission ordered Concordia Financing Company, Ltd. of California to jointly pay $2.6 million restitution and a $700,000 administrative penalty for its securities registration violations. The Corporation Commission found that Bersch and Wanzek fraudulently sold unregistered investment contracts in Concordia, which was in the business of purchasing and servicing subprime loans to truck drivers who purchased used, big rig trucks. The Corporation Commission found that Bersch, Wanzek and ER Financial were not registered to sell securities in Arizona, and they failed to disclose to several investors the finders' fees Concordia paid them for selling the investments. The Corporation Commission found Concordia did nothing to determine if an investor had the financial wherewithal to make an investment, and it failed to use questionnaires or other materials to determine whether investors were accredited investors.

For more details on this case, view the full text of the Corporation Commission's order
S-20906A-14-0063.

 

Gregory J. Sanchez, CoverLugg, LLC and Birdie Media, LLC
The Corporation Commission ordered Gregory J. Sanchez of Chandler and his two affiliated companies to pay more than $2 million in restitution and $150,000 in administrative penalties for defrauding investors. Sanchez and his limited liability companies, CoverLugg and Birdie Media, were never registered to sell securities in Arizona. The Corporation Commission found Sanchez engaged in securities fraud when he promised at least three investors a return on their investments within a year but failed to repay them. Also, the Corporation Commission found that Sanchez falsified company purchase orders and failed to disclose numerous judgments ordered against him and his conviction for bank fraud to relevant investors.

For more details on this case, view the full text of the Corporation Commission's order
S-20984A-16-0315.


Adam Child, Real Estate Finance Corporation, and WIN Opportunity Fund
The Corporation Commission ordered Adam Child of Scottsdale and his affiliated companies to pay a total of $3,6280,565 in restitution and a $40,000 administrative penalty for committing securities fraud in connection with real estate investments. The Corporation Commission found that Real Estate Finance Corporation and WIN Opportunity Fund solicited potential investors through information seminars, cold-calling and social media, but omitted material information that would have allowed investors to evaluate claims of Child's past business success and be informed about Child's previous judgment against him, his declaration of bankruptcy, and the license revocation of his prior mortgage-lending business.

For details on this case, view the full text of the Corporation Commission's order S-21018A-17-0232.

Titan Funding Group I, LLC and Titan Capital Holding, LLC
The Corporation Commission approved a consent order signed by the court-appointed receiver for Titan Funding Group I, LLC and Titan Capital Holding, LLC, requiring the companies to pay $39,740 in restitution. The restitution amount is what the receiver was able to distribute to the investors. The Commission found the companies raised more than $2.75 million from at least 25 investors, pooling the funds to lend money to real estate developers who were to purchase and "flip" residential properties. However, the Corporation Commission found that Titan Funding Group I, LLC failed to tell investors that its executive, Adam Child, had a previous judgment against him, had declared bankruptcy, and that Child's prior mortgage-lending business had its license revoked. Additionally, the Corporation Commission found Titan Funding Group I, LLC co-mingled funds from related companies that subsequently spent the funds on unsecured development projects and overhead.

For details on this case, view the full text of the Corporation Commission's order S-21054A-18-0301.
 

January 16, 2019
Former Scottsdale Man Defrauds Investors with "Fix-and-flip" Real Estate Investments
The Corporation Commission issued a default order against former Scottsdale resident Darrell G. Knoch and Imagine Enterprises, LLC for committing securities fraud in connection with unregistered "fix-and-flip" real estate investments. Respondents were ordered to pay $906,641 in restitution and $50,000 in administrative penalties for their violations. The Corporation Commission found that, while not registered to sell securities in Arizona, Knoch and his company failed to disclose to at least six investors that he had suspended promised interest payments to a prior investor and failed to return that investor's principal investment. Also, the Corporation Commission found that Knoch failed to disclose to investors that he filed for bankruptcy in 2014.
 
For more details on this case, view the full text of the Corporation Commission's order under docket S-21058A-18-0341.