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Univ. of Toledo College of Law

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Thursday, October 18, 2012

SEC Charges Three in ".44 Magnum" Investment Fraud

The SEC today charged a purported money manager and two of his chief marketers with defrauding investors in a fake company he created that bore a similar name to what was formerly one of Germany's largest banks.  According to the SEC, Geoffrey H. Lunn operated the $5.77 million investment scheme with assistance from Darlene A. Bishop and Vincent G. Curry. Lunn portrayed himself as the vice president of Dresdner Financial, a firm whose executives he claimed had connections to Dresdner Bank and was purportedly planning to purchase several other banks to expand its operations.

Lunn, Bishop, and Curry solicited investors for their ".44 Magnum Leveraged Financing Program" that they promised could turn an investment of just $44,000 into $2 million within 10 to 12 banking days.  Needless to say, it was fake. According to the SEC's complaint, Lunn admitted in sworn testimony during the SEC's investigation that, "It was a con, basically."

According to the SEC's complaint, Lunn also testified to SEC investigators that it was a "one-eyed man" using the alias "Robert Perello" who actually created Dresdner and the Magnum program. Lunn testified that Perello told him that he named the program accordingly because "when people found out they'd been ripped off, they would buy a .44 Magnum and shoot themselves in the head." Lunn claimed that Perello threatened to kill him and his family if he did not cooperate in the Dresdner scheme, and that he gave the cash he withdrew from investor funds and the Western Union transfers to Perello. Lunn is the only person who claims to have met Perello in person, saying he does not know Perello's true identify or current whereabouts and that his only distinguishing characteristic is that he has just one eye. Despite Lunn's assertions, no individual resembling Perello has been identified or located.

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