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SEC Sues 3 Southland Men for Alleged Fraud

September 04, 1997|Debora Vrana

The Securities and Exchange Commission sued three Southern Californians, alleging they raised $3.7 million in a fraud scheme involving fictional trading of securities purportedly issued by major international banks. In its complaint filed in federal district court in Los Angeles, the SEC alleges that from July 1994 through October 1994, Rob Nite, 46; Philip Thomas, 43; and David Sims, 47; promised investors that for an initial investment of $50,000 or $150,000 they would receive returns of $1 million a week for 40 weeks. In what is commonly known as a "prime bank" scheme, the men allegedly promised such astronomical returns from a bogus fictional trading program, the SEC said. Nite is currently in federal prison in Arizona serving a 44-month sentence for mail fraud; Sims and Thomas both live in Beverly Hills. A lawyer for the men was not available for comment. The SEC is seeking permanent injunctions against the defendants plus civil penalties and disgorgement of all alleged ill-gotten gains.

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