Fraud Charges Settled by Silicon Valley Man
The Securities and Exchange Commission charged a Silicon Valley man who raised millions for two Internet start-ups by falsely promising investors that his companies were on the verge of undergoing successful initial public offerings and were well on their way to becoming the “next Google.”
The SEC alleges that Benedict Van, of San Jose, Calif., lured investors into web-based start-ups hereUare, Inc. and eCity, Inc. by falsely telling them that the companies would go public within a matter of months and generate millions in quick returns. In truth, Van had no plans to take the companies public and relied solely on investor funds to stay in business. Ultimately, when investor funds ran out by the end of 2008, Van was forced to shut down operations.
“Van played on the hopes of investors, tricking them into believing that his companies were on the verge of becoming the next Silicon Valley success stories,” said Marc Fagel, Director of the SEC’s San Francisco Regional Office.
“Investors should be wary of pitches promising IPO riches from companies with minimal operat