Tuesday, January 29, 2008
On January 25, 2008, the federal district court for the Northern District of Georgia entered an order permanently enjoining Coadum Advisors, Inc. ("Coadum"), et alia, ("collectively "defendants") from violations of the federal securities laws and continued a freeze of defendants' assets.The SEC alleged that the defendants engaged in fraud in conjunction with a series of four securities offerings which began in early 2006 and raised approximately $30 million from at least 150 investors. The Complaint alleged that the defendants falsely represented to investors that they would receive a return of from 3 to 6% per month; misrepresented that their principal was protected; and failed to disclose that the defendants have made loans to themselves from the investor proceeds. Furthermore, the Complaint alleged that the defendants falsely represented in monthly account statements to investors that they have earned approximately 4% per month, and that all or most of their principal was in escrow. Finally, the Complaint alleged that, without disclosure to investors, Coadum and Mansell have also "borrowed" in excess of $3 million of, or against, the investors' funds and have disbursed approximately $5 million to related parties.