The U.S. Securities and Exchange Commission (SEC) said that it obtained emergency court orders to stop an alleged $23 million Ponzi scheme targeting Haitian-Americans.
In a statement made on Tuesday, the SEC halted operations of Creative Capital Consortium LLC. The SEC alleged that the company and its principal, George L. Theodule, conducted fraudulent activity beginning in 2007 to lure investors by promising to double their returns on capital within 90 days. In turn, Creative Capital’s returns would help fund new ventures benefiting Haitian communities in the United States, Haiti, and Sierra Leone.
Theodule raised around $23 million from Haitian-American investors nationwide.
“This alleged Ponzi scheme preyed upon unsuspecting members of a close-knit community, attempting to take advantage of the trust they had in each other,” Linda Chatman Thomsen, the SEC’s enforcement director, said in an agency statement. “As always, investors need to be wary of investment opportunities that guarantee results and tout extraordinary returns.”
According to the SEC, the alleged conman lost $18 million in trading stocks and options in 2008, and used newly-raised funds to pay early investors. He also embezzled at least $3.8 million of investor money for himself.
Theodule, based in Florida, ran Creative Capital and sister company A Creative Capital Concept$ LLC, which is no longer in operation.
SEC Scrutinized
Bespoke Investment Group LLC called this announcement as “too little, too late” for the SEC.
“How this one was detected, while the $50 billion Madoff scheme slipped through the cracks is beyond us,” Bespoke analysts said on its
The SEC has been under increased federal scrutiny for failing to uncover Bernie Madoff’s $50 billion in fraudulent investments. The U.S. House of Representatives planned a Jan. 5 hearing to review the SEC’s regulatory efforts related to Madoff and similar investment scams.
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