2024-07-29 sec-litreleases litigation_release 65 KB 2,487 chars

SEC v. Garrett W. Moretz, No. LR-26061, Western District of North Carolina (July 29, 2024) — Press Release

raw: Garrett W. Moretz

Garrett W. Moretz, No. 5:24-cv-00171 (July 29, 2024)

Caption
DOSTER v. TOUCHPOINT SUPPORT SERVICES LLC
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summary

The SEC filed a complaint against broker Garrett W. Moretz for fraudulently misrepresenting high-risk GWG L Bonds as guaranteed and safe to investors.

paragraph

The SEC has charged Garrett W. Moretz, Hedonova Fund, and Hedonova Advisors with violating the Securities Act of 1933 and the Securities Exchange Act of 1934. Between September 2019 and August 2020, Moretz allegedly misrepresented GWG Holdings, Inc. L Bonds as 'guaranteed' and '100% safe' regarding both principal and interest. While the complaint details various fraudulent communications, it does not specify a total dollar amount for the alleged fraud.

narrative

The U.S. Securities and Exchange Commission has filed a civil complaint in the Western District of North Carolina against broker Garrett W. Moretz, Hedonova Fund, and Hedonova Advisors. The SEC alleges that from September 2019 to August 2020, Moretz engaged in a fraudulent scheme by misrepresenting high-risk GWG Holdings, Inc. 'L Bonds' as guaranteed and safe. Specifically, Moretz used emails and telephone calls to tell investors that the bonds provided a guaranteed rate of return and were 100% safe regarding both principal and interest. The complaint asserts that Moretz knew or was reckless in not knowing that these interest payments and principal returns were not actually guaranteed. The charges include violations of Section 17(a) of the Securities Act of 1933, as well as Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934. This litigation seeks to address the pattern of misrepresenting these debt securities to potential investors.

Enriched metadata

Scheme
broker-dealer-fraud (100%)
Court
Western District of North Carolina
Case No.
5:24-cv-00171
Entity
Garrett W. Moretz
Classified broker-dealer-fraud(confidence 100%). EDGAR detection: forms Form D· recall 29% / precision 9%. detection rule →
Statutes
Section 17(a) of the Exchange Act of 1933, Section 10(b) of the Securities Exchange ActSection 17(a) of the Exchange Act of 1933, Section 10(b) of the Securities Exchange ActSection 17(a) of the Exchange Act of 1933, Section 10(b) of the Securities Exchange ActRule 10b-5
Parties
DOSTERTOUCHPOINT SUPPORT SERVICES LLC
Keywords
bondsmoretzguaranteedalleges moretzgarrett moretzsecurities exchangeallegesexchange commissionsec's allegesrate returnsecuritiesexchangereturngarrettsec's

Exhibits & Attached Documents (1)

Extracted insights

Entities 6
  • person christopher white
  • person cj kerstetter
  • person garrett moretz
  • person john birkenheier
  • person jonathan epstein
  • agency Securities and Exchange Commission
Triples 13
  • Securities and Exchange Commission Filed a complaint In Federal Court in Charlotte
  • Garrett Moretz Fraudulently sold L Bonds
  • Garrett Moretz Misrepresented L Bonds as guaranteed
  • Garrett Moretz Continued A long standing pattern of misrepresenting L Bonds as guaranteed
  • Garrett Moretz Sent emails To a customer making multiple references to L Bonds being guaranteed
  • Garrett Moretz Telephoned Another customer recommending the purchase of L Bonds
  • Garrett Moretz Told Another customer that L Bonds were 100% safe and 100% guaranteed
  • Garrett Moretz Knew or was reckless in not knowing That investors were not guaranteed to receive interest payments on L Bonds or the return of principal invested in L Bonds
  • Garrett Moretz Violated Section 17(a) of the Exchange Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder
  • Jonathan Epstein Conducted the investigation Of this matter
  • CJ Kerstetter Supervised Jonathan Epstein
  • Christopher White Led the litigation Of this matter
  • John Birkenheier Assisted Christopher White
PDF (from attached: complaint)
SEC v. GARRETT W. MORETZ · Source
Text layers
Extracted body text (2,487c) 
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26061 / July 29, 2024 Securities and Exchange Commission v. Garrett W. Moretz, Civil Action No. 5:24-cv-00171 (W.D. N.C. July 29, 2024.) SEC Charges Broker with Fraud Related to Sale of GWG L Bonds On July 29, 2024, the Securities and Exchange Commission filed a complaint in Federal Court in Charlotte alleging Garrett Moretz fraudulently sold high-risk debt securities known as L Bonds, which were issued by GWG Holdings, Inc. ("GWG"). The SEC's complaint alleges that Defendant Moretz misrepresented L Bonds to investors as "guaranteed" from at least September 2019 until about August 2020. Moretz's conduct during that period continued a long standing pattern of misrepresenting L Bonds as guaranteed to investors and potential investors. For example, the SEC's complaint alleges that Moretz's emails to a customer made multiple references to L Bonds being guaranteed such as: "Are you looking for a great guaranteed rate of return and payout on your money?" "We have fully guaranteed investment/income options available in 2-, 3-, 5-, and 7-year terms." "These are guaranteed to pay the specified rate of return MONTHLY for the predetermined period after which you get your full investment returned." "These are all great opportunities for folks that want a steady rate of return and guaranteed payout." The complaint further alleges that Moretz telephoned another customer recommending the purchase L Bonds stating that L Bonds would provide a better return than she was getting on other investments, that they were "safe" and "guaranteed," and the customer would get her money back. The complaint also alleges that Moretz told another customer that L Bonds were 100% safe and 100% guaranteed with regard to both the principal and interest and there was zero risk in an investment in L Bonds. The complaint alleges that Moretz knew or was reckless in not knowing that investors were not guaranteed to receive interest payments on L Bonds or the return of principal invested in L Bonds. The SEC's complaint alleges that Moretz the Hedonova Fund and Hedonova Advisors violated Section 17(a) of the Exchange Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder. The investigation of this matter was conducted by Jonathan Epstein and supervised by CJ Kerstetter, of the SEC's Chicago Regional Office. The litigation will be led by Christopher White and assisted by John Birkenheier.
OCR text (2,487c · html-text · 99% conf) 
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26061 / July 29, 2024 Securities and Exchange Commission v. Garrett W. Moretz, Civil Action No. 5:24-cv-00171 (W.D. N.C. July 29, 2024.) SEC Charges Broker with Fraud Related to Sale of GWG L Bonds On July 29, 2024, the Securities and Exchange Commission filed a complaint in Federal Court in Charlotte alleging Garrett Moretz fraudulently sold high-risk debt securities known as L Bonds, which were issued by GWG Holdings, Inc. ("GWG"). The SEC's complaint alleges that Defendant Moretz misrepresented L Bonds to investors as "guaranteed" from at least September 2019 until about August 2020. Moretz's conduct during that period continued a long standing pattern of misrepresenting L Bonds as guaranteed to investors and potential investors. For example, the SEC's complaint alleges that Moretz's emails to a customer made multiple references to L Bonds being guaranteed such as: "Are you looking for a great guaranteed rate of return and payout on your money?" "We have fully guaranteed investment/income options available in 2-, 3-, 5-, and 7-year terms." "These are guaranteed to pay the specified rate of return MONTHLY for the predetermined period after which you get your full investment returned." "These are all great opportunities for folks that want a steady rate of return and guaranteed payout." The complaint further alleges that Moretz telephoned another customer recommending the purchase L Bonds stating that L Bonds would provide a better return than she was getting on other investments, that they were "safe" and "guaranteed," and the customer would get her money back. The complaint also alleges that Moretz told another customer that L Bonds were 100% safe and 100% guaranteed with regard to both the principal and interest and there was zero risk in an investment in L Bonds. The complaint alleges that Moretz knew or was reckless in not knowing that investors were not guaranteed to receive interest payments on L Bonds or the return of principal invested in L Bonds. The SEC's complaint alleges that Moretz the Hedonova Fund and Hedonova Advisors violated Section 17(a) of the Exchange Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder. The investigation of this matter was conducted by Jonathan Epstein and supervised by CJ Kerstetter, of the SEC's Chicago Regional Office. The litigation will be led by Christopher White and assisted by John Birkenheier.

Related documents (2)