Wednesday, July 11, 2007
The SEC filed an emergency action on May 22, 2007, against two Californians and their company to halt an ongoing fraudulent scheme operated in Orange County, Calif., in which the defendants raised at least $3.7 million from approximately 33 investors. The court entered a temporary restraining order freezing the assets of TG Capital, LLC, a Nevada limited liability company, Thanh Viet Jeremy Cao, age 26, of Orange County, Calif. and Las Vegas, Nev., and Lodavina Grosnickle, age 51, of Chula Vista, Calif. The complaint alleges that from February 2007 to the present, Cao and Grosnickle lured investors to invest in TG Capital by falsely promising rates of return between 28% and 30% on their investment and assuring investors that TG Capital's investments were secured by guarantees from major banks or gold. The complaint also alleges that Cao forged at least one bank guarantee to support his false claims. The complaint further alleges that Cao and Grosnickle recently transferred $1.78 million of investor funds to a bank in Hong Kong, purportedly to make a personal loan from Cao to an individual. The Commission alleges that defendants falsely represented the overseas transfer was a legitimate TG Capital investment when in fact, Cao personally loaned the money, leaving TG Capital investors with no recourse if the individual borrower defaults.