Ponzi Scam Result in SEC Charges For Two Dallas-Based Broker-Dealers

The Securities and Exchange Commission has filed charges against two Global Corporate Alliance executives based in Dallas for running an alleged $10 million Texas Ponzi scam and defrauding at least 80 investors. The regulator claims that Gloria Solomon and Duncan MacDonald promoted the medical insurance company as a solid investment when actually GCA was a start-up that had practically no revenue and no operating history. They are charged with securities fraud, acting as unregistered broker-dealers, and conducting an unregistered securities offering. Meantime, the U.S. Attorney’s Office for the Northern District of Texas has opened a parallel criminal case against the Solomon and MacDonald.

Per the SEC’s securities complaint, MacDonald founded Global Corporate Alliance. When he couldn’t find a large investor, he then went after individual investors, misrepresenting his company’s business and financial state, as well as fabricating enrollment numbers.

Proceeds from new investors were purportedly used to pay off older investors. When the number of new investors dried up, MacDonald and Solomon are said to have employed stall tactics to delay payments due. In the process, contends the SEC, the two of them raised closed to $10 million in investor funds. Of that money, about $2 million went back to these investors as their “payments,” while Solomon and MacDonald pocketed a million each and used the rest to cover business expenses. They then spent a year holding off investors who expected payments while they alternative sources of cash.

If you are an investor that has suffered financial losses in a Ponzi scam or any other financial scheme, do not hesitate to contact our Texas securities fraud law firm today.

SEC Charges Two Executives in Ponzi Scheme At Dallas-Based Medical Insurance Company, SEC, June 17, 2013

SEC Complaint (PDF)

More Blog Posts:
Texas Federal Agents Pursue Largest Forfeiture Cases To Date, Stockbroker Fraud Blog, June 8, 2013
Stock Trader Faces Front Running Charges In Alleged $1.7M Texas Securities Fraud, Stockbroker Fraud Blog, June 1, 2013

Goldman Sachs Execution and Clearing Must Pay $20.5M Arbitration Award in Bayou Ponzi Scam, Upholds 2nd Circuit, Institutional Investor Securities Blog, July 14, 2013

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