And more than anything else: Not getting into bed with a devil.
U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23919 / August 24, 2017
Securities and Exchange Commission v. Sonya D. Camarco, Camarco Investments, Inc. and Camarco Living Trust,
No. 1:17-cv-02027 (D. Colo. filed Aug. 23, 2017)
SEC Obtains Asset Freeze Against Former Broker Charged with Stealing Client Funds
The Securities and Exchange Commission announced that it has obtained an emergency court order and asset freeze preventing a former Colorado-based broker from further dissipating stolen client assets.
According to the SEC's complaint, over the course of 13 years, Sonya D. Camarco, a resident of Colorado Springs, Colorado, stole money from her clients' accounts and then lied to her clients about the withdrawals. The SEC alleges that Camarco appears to have forged client signatures on checks made out to "C Investments," an entity Camarco used, and had the checks sent to a private post office box that she rented. Camarco also allegedly liquidated securities in her clients' accounts to make unauthorized payments to accounts she controlled. The complaint alleges that when confronted by clients, Camarco lied and told them that C Investments was an outside investment that she made on their behalf. The complaint alleges that when confronted by her employer, Camarco lied again, saying that she had no affiliation with C Investments and characterizing it as an outside investment held by one of her advisory clients. The SEC alleges that Camarco used the stolen client funds to pay her personal credit card bills and her mortgages.
The SEC also charged Camarco Investments, Inc. and Camarco Living Trust as relief defendants based on their alleged receipt of stolen client funds.
The SEC's complaint, filed in federal court in Colorado on August 23, 2017, charges Camarco with violations of Sections 17(a)(1) and (3) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5(a) and (c) thereunder, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940. The complaint seeks disgorgement of allegedly ill-gotten gains plus interest from all the defendants and seeks a permanent injunction against and penalties from Camarco.
LPL Financial and former advisor Camarco, who pleaded guilty to theft and securities fraud must pay at least $3.7 million in disgorgement and arbitration settlements; the total amount that may be awarded in arbitration hearings could climb above $11 million. Since 2013, LPL has paid an astonishing $135 million in fines to FINRA or the SEC per published company data as of September 2018.
Court Orders Wife of Accused Ponzi Schemer to Pay Millions of Dollars
Litigation Release No. 24348 / November 9, 2018
Securities and Exchange Commission v. Joseph Meli, et al.,
No. 17-CV-632 (S.D.N.Y. filed Jan. 27, 2017)
A federal court has ordered the wife of an accused Ponzi schemer to disgorge more than $4 million in investor funds.
The Securities and Exchange Commission charged Joseph Meli in January 2017 with fraud for running a Ponzi scheme. The SEC alleged that Joseph Meli raised money from investors to fund businesses purportedly created to purchase and resell tickets to such high-demand shows as Adele concerts and the Broadway musical Hamilton. Joseph Meli was criminally charged in a parallel case in which he pled guilty and was sentenced to a 78-month prison sentence. He also was ordered in the parallel criminal case to forfeit over $104 million, including a house in East Hampton, New York, and to pay over $56 million in restitution.
Jessica Ingber Meli is the wife of Joseph Meli. The SEC named Jessica Ingber Meli as a relief defendant for the purpose of recovering investor funds allegedly in her possession, including $3 million which was used to purchase the house in East Hampton in her name. She agreed to settle with the SEC, consenting to disgorgement and prejudgment interest of approximately $4 million. Because the house in East Hampton is subject to the forfeiture order entered against Joseph Meli in the parallel criminal case, approximately $3.2 million of the judgment will be deemed satisfied and Jessica Ingber Meli will be obligated to pay approximately $840,000.
Joseph Meli's co-defendant, Matthew Harriton, and several of Harriton's entities, settled the SEC's charges against them in July 2018. In September 2017, the SEC also charged Joseph Meli and New York sports radio personality Craig Carton with fraud for stealing millions of dollars from investors who were allegedly promised their funds would be used for the purchase and resale of concert tickets. The SEC's litigation against Joseph Meli and others in both cases is ongoing.
Principal of Mississippi Company Who Ran Multimillion Dollar Ponzi Scheme Sentenced to 19.5 Years Imprisonment in Parallel Criminal Action
Litigation Release No. 24347 / November 9, 2018
Securities and Exchange Commission v. Arthur Lamar Adams et al.,
No. 18-cv-252 (S.D. Miss. filed Apr. 20, 2018)
United States v. Adams, No. 3:18-cr-88 (S.D. Miss. filed May 1, 2018)
On October 30, 2018, the principal of a Mississippi company charged by the Securities and Exchange Commission with fraud for allegedly bilking at least 150 investors in a multimillion dollar Ponzi scheme was sentenced in a parallel criminal action to 19.5 years imprisonment.
The parallel criminal action arose from the same facts and circumstances alleged by the SEC. The SEC alleged that Arthur Lamar Adams lied to investors by telling them that their money would be used by his company, Madison Timber Properties, LLC, to secure and harvest timber from various land owners located in Alabama, Florida, and Mississippi, and promised annual returns of 12-15%. But Madison Timber never obtained any harvesting rights. Instead, Adams allegedly forged deeds and cutting agreements as well as documents purportedly reflecting the value of the timber on the land. Adams also allegedly paid early investors with later investors' funds and convinced investors to roll over their investments. According to the complaint, Adams used investors' money for personal expenses and to develop an unrelated real estate project. In the SEC action, Adams has consented to a permanent injunction, an asset freeze, and expedited discovery. The court overseeing the SEC action has appointed a receiver. The receiver has established a website, which contains information on the receiver's progress and on any relevant federal or state proceedings.
SEC Files Amended Complaint Adding Wives of Principal Defendants as Relief Defendants
Litigation Release No. 24346 / November 9, 2018
Securities and Exchange Commission v. Kevin B. Merrill, et al., No. 18-civ-2844 (D. Md. filed Sept. 13, 2018)
The Securities and Exchange Commission has named as relief defendants the wives of two defendants charged with running a Ponzi-like scheme that raised more than $345 million from over 230 investors across the U.S. The court overseeing the SEC's litigation has appointed a receiver and entered a preliminary injunction continuing an asset freeze until the case's conclusion.
The SEC alleges that Amanda Merrill and Lalaine Ledford, the wives of Kevin B. Merrill and Jay B. Ledford, respectively, received millions of dollars' worth of proceeds from the fraud their husbands and another individual ran in the form of real property, cash, luxury items and other goods, to which they have no legitimate claim. The SEC alleges that the wives have been unjustly enriched and seeks to have them disgorge their ill-gotten gains.
SEC Charges Florida Man in Day Trading Scheme
Litigation Release No. 24344 / November 8, 2018
Securities and Exchange Commission v. Ricardo H. Goldman, No. 1:18-cv-24678 (S.D. Fla. filed November 7, 2018)
On November 7, 2018, the Securities and Exchange Commission charged Florida resident Ricardo H. Goldman for fraudulently operating an unregistered securities day trading firm.
According to the SEC's complaint, Goldman misled dozens of day traders into thinking they were opening individual online securities trading accounts with Goldman's broker-dealer, America Capital Group LLC, which was not registered with the SEC. The SEC alleges that between at least November 2010 and August 2015, Goldman raised approximately $6.9 million from traders and then comingled their funds by placing them in a pooled master brokerage account that he controlled. Goldman allegedly concealed the comingling of the funds by giving traders online access to individual sub-accounts within the pooled master account. Goldman allegedly profited by charging traders a commission on their trades. According to the SEC's complaint, the pooled account ultimately sustained at least $3.6 million in trading loses. Because funds were commingled, traders were forced to share in the overall losses incurred in the master account. The complaint further alleges Goldman made material misrepresentations and omissions to traders regarding his background and disciplinary history which includes antifraud and securities and broker-dealer registration injunctions, a broker-dealer bar, and a state court conviction for grand theft and forgery.
The SEC's complaint, which was filed in the Southern District of Florida, charges Goldman with violating Sections 10(b), 15(a)(1), and 15(b)(6)(B) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder, and seeks permanent and conduct-based injunctions, disgorgement of ill-gotten gains with interest, and penalties.
Upon filing of the Commission's complaint, and without admitting or denying the allegations in the complaint, Goldman consented to the entry of a judgment that permanently enjoins him from violating the above-mentioned provisions of the federal securities laws, imposes a conduct-based injunction, and directs Goldman to comply with the Commission's Order dated November 19, 2008, In the Matter of Ricardo H. Goldman (Exchange Rel. No. 58976, Admin. Proc. 3-13293). The Judgment also orders Goldman to pay disgorgement of $470,000, prejudgment interest thereon in the amount of $53,497, and a civil penalty in the amount of $320,000.
I have become tired of them. Tired of who? Repeaters posing a reporters.
There have been a few good reporters who did their jobs without the BS. The list that I've engaged with includes Michel Northsea of the Citrus Chronicle, Bill Thompson of the Lakeland Ledger, Carlos Medina of the Stan Banner, and Mark Schoeff Jr. of InvestmentNews. There are a few others but most are retired, out of business, or I am an ongoing non-attribution source; in other words, since I've testified as an expert witness against agents, advisors, brokers, dealers, planners, and their companies on an individual and class action basis, I guess I am that guy some trust because when I throw stones, I damn sure do not live in a glass house.
**Where does my disgust come from? **
For clients of TSA I will one day share my father's and my experiences with the media; however, for this public blog, I will keep it brief and in my typical outline format.
As an investment advisor, we need facts and figures. We cannot count of the federal government for hard facts as they too are well known to giggle the numbers to fit the narrative. Business news sites are not longer trustworthy. They are not. Far too many have slipped in their bias and thus a little here and there means we don't trust you like before. Urinate on me once, you're a bad dog. Try it again and you'll get kicked to the curb as you begin to hike your leg.
Jack Webb as Sergeant Joe Friday of Dragnet
Paul Grant Truesdell, CEO
J.D., AIF, CLU, ChFC, RFC
TrueStar Advisors, Inc.
It really does and that’s worth thinking about.
Why would anyone want to scream, holler, and get upset with someone in the 1%? I have no idea but I do know this, it’s the 99% that counts, not the 1%. 99%? Wait, you’re thinking I’m one of those, right? You think I am going to talk about how wonderful the majority of the population is, how everyone is created equal, and that everyone should enjoy an equal share of the fruits of the land. Well, you got ahead of yourself and you’re wrong. No, it’s not about the 1%, it has always been about the 99%. Confused. I hope so and I hope I have your attention.
Where should I go with this? Well, hopefully I have a few more minutes of your time, so let’s drop the punchline, then elaborate a bit, and finish so we can both get back to work.
It’s not about walking 20 steps in 20 directions but 20 steps in one direction. It’s not about luck but it is also true that for some, if not for bad luck, they would have none at all, and so, don’t be so damn full of yourself. Fame and fortune is overwhelmingly due to the 99% that the 99% are unwilling to do. There is no need to be jealous, have greed or envy. Not a bit when it’s there if you want it. As the Nike slogan says: Just Do It.
It has been said by many, Thomas Edison included, that genius and success is 1% inspiration and 99% perspiration. It has been my experience that this is 100% true, but with a twist. I believe without doubt or hesitation that 1% is also luck. Oh it might be more by a percent or two, but let’s stick with 1% and keep it simple. 1% inspiration, 98% perspiration, and 1% luck. That I can live with and that I believe.
Now let’s toss in a few zingers. Oh I could tell you a story or two. I could wine and dine your mind, but how about I just go diner-grub and get to it.
There are variants of the Thomas Edison quote about 1% inspiration and 99% perspiration, but the crux of it comes down to habits, routines, checklists, persistence, and patience. If you want to be in the 99% (remember, 99% sounds better and the buttercups and snowflakes will go nuts over this; I can’t help myself and I love it) start by thinking. Thinking is hard. Honest thinking is really hard. Thinking honestly and creatively is super hard. And the truth of the matter is that the 50% of the population that cannot scrape $1,000 together and are in debt up to their eyeballs and beyond, are more often than not the victims of not thinking rather than bad luck. Who in their right mind thinks they are going to get anywhere without first putting pen to paper and creating a checklist? Who thinks they can take one giant Stretch Armstrong step from Jacksonville to Los Angeles rather than a series of small steps? Who thinks the next president is going to be someone who decided within the last year or two that he or she would make a run for it? Really. You think that. Do you really think a goober like Mark Cuban, Chris Rock, or Cynthia Nixon are one day going to try to replicate what Donald Trump did? I don’t think so. Why? Because Donald Trump took decades to lay the foundation for his first run at public office, and the fact that it was the highest office that he shot for and got, was not a fluke but the result of 98%.
The 99% take the time to make their list like Santa, and they cross off items from the list, one at a time. The list is not the holy grail but rather a guide for the trial and error process that one has to go through. As I said, it’s the unglamorous grunt worth that the 99% do. Sure, you, me, and all of the 99% will struggle with the tedium, but we get over it, plow through, and continue a purposeful walk in a specific direction rather than a casual meandering loop de loop.
Okay, enough of this. Inspiration does not pay off without diligence. Inspiration requires thinking and thinking is not as easy as non-thinkers think it is. That’s cute isn’t it, not as easy as non-thinkers think; think of me chuckling which is what I am doing as I write this. Go ahead, chuckle yourself.
Simple is not as simple as simpletons think it is. It truly isn’t. Making mountains out of molehills is the bane of the whole damn world. Just get to the point and move on.
So, inspiration, perspiration, thinking, checklists, habits, routines, persistence, patience, and a bit of luck. It is what it is, and the chips will fall where they may.
But if you cup your hands together, you’ll catch a whole lot more.
This is one example of what we call "old school" investment advisory services.
The pufferfish is the fugu in Japanese or bogeo in Korean and can be lethally poisonous if prepared improperly. Only chefs who are licensed can prepare the dish and rigorous training takes three to four years. Now consider the consequences of bad a bad pufferfish dish. The symptoms from ingesting a lethal dose of tetrodotoxin begin with dizziness, exhaustion, headache, nausea, and move into extreme difficulty breathing. While you are conscious, you cannot speak or move and breathing stops and asphyxiation follows.
How about real estate and the flipping of homes. Lots of television shows and articles galore tout the rags to riches of many who bought low, fixed it up, and made a killing.
Regardless of the facts and figures, far too many homeowners, who are barely able to keep their house in good working order, have felt the need to buy, repair, and flip. Good intentions and a higher level of interest does not make a business.
Despite what the blowhard gurus tell you, owning individual real estate is a high-risk business with low margins for many. The risks are plentiful. Although everything is fixable, it's always a matter of cost, and it will cost you far more money if you do not do it yourself, but the tradeoff is time and effort. This leads me to ask the question, and this is primarily for those who are "retired" and living in friendly hometown communities: Why? Why would you risk so much at this time in your life? If this is a passion and job, then you are not retired, but rather, financially independent and off doing the next business venture. Always remember and never forget that full retirement equals death, entertainment retirement is doing what you like and spend money doing, and an active retirement is doing what you like, are good and profitable at, and can control. In other words, you reached financial independence and refocused or changed course but continued to build and grow from the basis of "why not?"
Before you dive into "Puffer-Land," consider everything that can go wrong and your capabilities to handle and fix problems and remember:
If you want to own real estate but without the concentrated risk of individual land, homes, or commerical property, become a guest and ask to view our video: A True Fiduciary Approach to Real Estate Investment Trusts.
Think About This
A Few Examples - Who Do You Use?
Welcome to our blog and thank you for visiting. This is the limited public blog version of Connecting Dots. The full version of Connecting dots is for client educational use only. Investment Performance Is Not Guaranteed. Past performance is not indicative of future results. This material does not take into account your particular investment objectives, financial situation or needs. Nothing should be construed as an individual recommendation. Always read and all applicable information carefully before making an investment decision. Investments are not bank guaranteed, not FDIC insured. and may lose value. Due to our extensive holdings and that of our clients, you should assume that we have a position in all companies discussed and thus a conflict of interest should be assumed.
Sitting in the ruined airplane hangars of Tyndall Air Force Base, which was shredded on Wednesday when Hurricane Michael swept across the Florida Panhandle, may be some of the Air Force’s most advanced — and most expensive — stealth fighter jets.
John McCain: F-35 program has been a 'scandal - All talk and lot's of campaign contributors keeping the status quo as it is. With McCain gone, things might change.
TrueStar Advisors Investment Silos Discussed Five Year Annualized Return as of October 12, 2018
Returns reflect our base model performance from the Inception Date to the Date Funded, and funded performance since the Date Funded, if funded. Your returns may deviate significantly from the values displayed here, due to many factors, including how long after a strategy has been updated that you place orders to update your holdings.
Model performance deviates from actual client performance. Some of the common reasons include:
Different execution prices – model trades execute immediately while client trades execute in windows. Previous day pricing – mutual funds in models are executed at the previous day NAV while client mutual fund trades are executed at the trade date NAV. Model equity trades placed outside of market hours execute at the previous closing price. Frequent rebalances – models that are rebalanced frequently will deviate more quickly since different execution prices will have a greater impact. Missed syncs – model holdings will differ from client holdings if the model is modified but not synced or if a particular client does not fully sync to the model weights. Model Silo returns are calculated using the same methodology as funded folios–the Mid-Weighted Dietz Method. At launch, each model Silo has a hypothetical market value, which then changes over time based on the changing value of the underlying holdings.
Residential REITS are real estate investment trusts that focus primarily on rental apartment buildings and manufactured housing. Because these REITs depend on rental income from the properties they manage, many tend to own rental apartment building in high cost regions such as New York and Los Angeles. Residential REITs own and manage various forms of residences and rent space in those properties to tenants. Residential REITs include REITs that specialize in apartment buildings, student housing, manufactured homes and single-family homes. Within those market segments, some residential REITs also focus on specific geographical markets or classes of properties.