US SEC Fines Individuals $20m Over Ponzi Scheme
The United States District Court for the District of Utah has granted the SEC’s motion for entry of final judgment against Thomas R. Fry, Bevan J. Wilde, Gary W. Hansen, Michael G. Butcher, James B. Mooring, and Michael W. Averett ordering disgorgement and civil penalties totaling over $20 million.
Previously, pursuant to stipulation, the court entered permanent injunctions against these defendants enjoining them from future violations of the federal securities laws. The SEC Complaint alleged that these defendants acted as promoters for a Ponzi scheme operated by Jeffrey L. Mowen, who is currently serving a 10-year prison term for his actions.
The complaint alleged that the promoters raised millions of dollars through the unregistered offer and sale of high-yield promissory notes to over 150 investors in several states. The funds raised were then funneled to Mowen through Thomas Fry, who used the funds for his personal benefit, misappropriating over $8 million.
The court ordered that the defendants disgorge the following amounts of ill-gotten gains and civil penalties, respectively: Thomas Fry – $16,751,439.94 and $250,000; Bevan Wilde – $1,326,241.77 and $130,000; James Mooring – $505,521.84 and $130,000; Michael Averett – $774,936.02 and $130,000; Gary Hansen – $349,481.33 and $130,000; Michael Butcher – $201,278.11 and $130,000.
The court also granted, in part, the SEC’s motion for summary judgment against defendant and promoter David G. Bartholomew.