SEC v. Phoenix Outsourced Development, LLC; Edger Solutions Management, LLC; Michael McLaughlin; Derek McLaughlin; Louis Peter Goff; Eric Fairbourn, et al., No. LR-25850, District of Utah (Sept. 25, 2023) — Press Release
raw: Phoenix Outsourced Development, LLC, Edger Solutions Management, Michael McLaughlin, Derek McLaughlin, Louis Peter Goff, Eric Fairbourn, Brian Hubbard, Nicholas Deluca
Phoenix Outsourced Development, LLC, Edger Solutions Management, Michael McLaughlin, Derek McLaughlin, Louis Peter Goff, Eric Fairbourn, Brian Hubbard, Nicholas Deluca, No. LR-25850 (Sept. 25, 2023)
summary
The SEC charged two Utah fund managers and their principals with orchestrating a fraudulent Forex trading program that caused $2.1 million in losses, resulting in settled charges and injunctions.
paragraph
The SEC charged Phoenix Outsourced Development, Edger Solutions Management, and several principals with securities fraud involving a $2.1 million Forex scheme. The defendants allegedly fabricated account statements, misstated fees, and failed to disclose that funds were managed by a convicted felon. All defendants consented to permanent injunctions and various disgorgements and civil penalties.
narrative
The SEC announced settled charges against Utah fund managers Phoenix Outsourced Development and Edger Solutions Management, along with principals Michael McLaughlin, Derek McLaughlin, Louis Peter Goff, Eric Fairbourn, Brian Hubbard, and Nicholas Deluca. The defendants allegedly orchestrated a fraudulent high-yield Forex trading program that resulted in approximately $2.1 million in investor losses. According to the complaint, the group failed to disclose that investments were pooled into an account operated by a convicted felon and a securities law recidivist. Furthermore, the defendants were accused of fabricating monthly account statements, misappropriating funds, and making material misrepresentations regarding fees and performance. The SEC charged the defendants with violations of Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act. Without admitting or denying the allegations, the defendants consented to permanent injunctions and various financial penalties, including significant disgorgements and civil penalties for the McLaughlin brothers.
Classified financial-fraud(confidence 97%). EDGAR detection: forms 10-K/10-Q/8-K/NT 10-K· recall 67% / precision 23%. detection rule →
Parties
Securities and Exchange CommissionPhoenix Outsourced Development, LLCEdger Solutions Management, LLCMichael McLaughlinDerek McLaughlinLouis Peter GoffEric FairbournBrian HubbardNicholas Deluca
Keywords
mclaughlinderek mclaughlinsecuritiesphoenix outsourcedoutsourced developmentedger solutionsmichael mclaughlinlouis peterpeter gofferic fairbournbrian hubbardnicholas delucasolutionssolutions managementsecurities exchange
Exhibits & Attached Documents (1)
Extracted insights
Dollar amounts 9
- $2.10M $2.1 million $1M–$10M
- $207K $207,182 $100K–$1M
- $117K $116,940 $100K–$1M
- $108K $108,433 $100K–$1M
- $75K $75,000 $10K–$100K
- $60K $60,000 $10K–$100K
- $50K $50,000 $10K–$100K
- $12K $11,503 $10K–$100K
- $11K $10,667 $10K–$100K
Entities 8
- person derek mclaughlin
- person each defendant
- person each individual defendant
- person investor funds
- person louis peter goff
- person michael mclaughlin
- person monthly account statements
- agency Securities and Exchange Commission
Triples 15
- Securities And Exchange Commission charged Phoenix Outsourced Development, LLC, Edger Solutions Management, LLC, Michael McLaughlin, Derek McLaughlin, Louis Peter Goff, Eric Fairbourn, Brian Hubbard, Nicholas Deluca with securities fraud
- Michael McLaughlin and Derek McLaughlin created an investment fund called POD Solutions, LLC, managed by Phoenix Outsourced Development
- Louis Peter Goff, Brian Hubbard, Eric Fairbourn, and Nicholas Deluca created a separate investment fund called Edger Solutions, LLC, managed by Edger Management Solutions
- The two fund managers and their principals failed to disclose to investors that their investments would be combined into a Forex trading account operated by a convicted felon and a securities fraud recidivist
- The defendants made numerous material misrepresentations to investors concerning fees, profit and loss calculations, and the historical performance of the funds
- The defendants fabricated monthly account statements
- Michael and Derek McLaughlin misappropriated investor funds
- Securities And Exchange Commission filed a complaint in U.S. District Court for the District of Utah charging all defendants with violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder
- Each defendant consented to a permanent injunction from future violations of antifraud provisions
- Each individual defendant consented to a conduct-based injunction prohibiting participation in the issuance, purchase, offer, or sale of any security
- Michael McLaughlin agreed to pay disgorgement of $116,940 plus prejudgment interest of $11,503, and a civil penalty of $207,182
- Derek McLaughlin agreed to pay disgorgement of $108,433 plus prejudgment interest of $10,667, and a civil penalty of $75,000
- Louis Peter Goff agreed to pay a civil penalty of $60,000
- Brian Hubbard, Eric Fairbourn, and Nicholas Deluca agreed to pay civil penalties of $50,000 each
- Securities And Exchange Commission conducted an investigation by Jennifer Moore and Paul Feindt, supervised by Tanya Beard and Tracy Combs of the Salt Lake Regional Office
PDF (from attached: complaint)
Text layers
Extracted body text (3,280c)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 25850 / September 25, 2023 Securities and Exchange Commission v. Phoenix Outsourced Development, LLC, Edger Solutions Management, LLC, Michael McLaughlin, Derek McLaughlin, Louis Peter Goff, Eric Fairbourn, Brian Hubbard, Nicholas Deluca, No. 2:23-civ-00663-DAO (U.S. District Court, District of Utah) filed September 25, 2023 SEC Charges Two Utah Fund Managers and Their Principals with Securities Fraud The Securities and Exchange Commission today announced settled charges against two Utah fund managers, Phoenix Outsourced Development and Edger Solutions Management, and their principals, including a securities law recidivist, for allegedly orchestrating a fraudulent high-yield Forex trading program through two investment funds resulting in approximately $2.1 million in investor losses. According to the SEC's complaint, Michael McLaughlin, a securities law recidivist, and Derek McLaughlin created an investment fund called POD Solutions, LLC, managed by their entity, Phoenix Outsourced Development. Louis Peter Goff, Brian Hubbard, Eric Fairbourn, and Nicholas Deluca created a separate, but similar investment fund, Edger Solutions, LLC, managed by their entity, Edger Management Solutions. The SEC alleges the two fund managers and their principals failed to disclose to investors that their investments would be combined into a Forex trading account that was operated by a convicted felon and a securities fraud recidivist. The SEC's complaint also alleges that the defendants made numerous material misrepresentations to investors concerning fees, profit and loss calculations, and the historical performance of the funds. The SEC further alleges that the defendants fabricated monthly account statements and that Michael and Derek McLaughlin misappropriated investor funds. The SEC's complaint, filed in U.S. District Court for the District of Utah, charges all defendants with violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Without admitting or denying the allegations, each defendant consented to a permanent injunction from future violations of these antifraud provisions. Each individual defendant also consented to a conduct-based injunction prohibiting him from participating, directly or indirectly, including but not limited to, through any entity owned and controlled by him, in the issuance, purchase, offer, or sale of any security, provided, however, that such injunction shall not prevent him from purchasing or selling securities for his own personal account, and agreed to pay disgorgement with prejudgment interest and civil penalties in the following amounts: Michael Mclaughlin: disgorgement of $116,940 plus prejudgment interest of $11,503, and a civil penalty of $207,182. Derek McLaughlin: disgorgement of $108,433 plus prejudgment interest of $10,667, and a civil penalty of $75,000. Louis Peter Goff: a civil penalty of $60,000. Brian Hubbard, Eric Fairbourn, and Nicholas Deluca: civil penalties of $50,000 each. The SEC's investigation was conducted by Jennifer Moore and Paul Feindt and was supervised by Tanya Beard and Tracy Combs of the Salt Lake Regional Office. SEC Complaint
OCR text (3,280c · html-text · 99% conf)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 25850 / September 25, 2023 Securities and Exchange Commission v. Phoenix Outsourced Development, LLC, Edger Solutions Management, LLC, Michael McLaughlin, Derek McLaughlin, Louis Peter Goff, Eric Fairbourn, Brian Hubbard, Nicholas Deluca, No. 2:23-civ-00663-DAO (U.S. District Court, District of Utah) filed September 25, 2023 SEC Charges Two Utah Fund Managers and Their Principals with Securities Fraud The Securities and Exchange Commission today announced settled charges against two Utah fund managers, Phoenix Outsourced Development and Edger Solutions Management, and their principals, including a securities law recidivist, for allegedly orchestrating a fraudulent high-yield Forex trading program through two investment funds resulting in approximately $2.1 million in investor losses. According to the SEC's complaint, Michael McLaughlin, a securities law recidivist, and Derek McLaughlin created an investment fund called POD Solutions, LLC, managed by their entity, Phoenix Outsourced Development. Louis Peter Goff, Brian Hubbard, Eric Fairbourn, and Nicholas Deluca created a separate, but similar investment fund, Edger Solutions, LLC, managed by their entity, Edger Management Solutions. The SEC alleges the two fund managers and their principals failed to disclose to investors that their investments would be combined into a Forex trading account that was operated by a convicted felon and a securities fraud recidivist. The SEC's complaint also alleges that the defendants made numerous material misrepresentations to investors concerning fees, profit and loss calculations, and the historical performance of the funds. The SEC further alleges that the defendants fabricated monthly account statements and that Michael and Derek McLaughlin misappropriated investor funds. The SEC's complaint, filed in U.S. District Court for the District of Utah, charges all defendants with violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Without admitting or denying the allegations, each defendant consented to a permanent injunction from future violations of these antifraud provisions. Each individual defendant also consented to a conduct-based injunction prohibiting him from participating, directly or indirectly, including but not limited to, through any entity owned and controlled by him, in the issuance, purchase, offer, or sale of any security, provided, however, that such injunction shall not prevent him from purchasing or selling securities for his own personal account, and agreed to pay disgorgement with prejudgment interest and civil penalties in the following amounts: Michael Mclaughlin: disgorgement of $116,940 plus prejudgment interest of $11,503, and a civil penalty of $207,182. Derek McLaughlin: disgorgement of $108,433 plus prejudgment interest of $10,667, and a civil penalty of $75,000. Louis Peter Goff: a civil penalty of $60,000. Brian Hubbard, Eric Fairbourn, and Nicholas Deluca: civil penalties of $50,000 each. The SEC's investigation was conducted by Jennifer Moore and Paul Feindt and was supervised by Tanya Beard and Tracy Combs of the Salt Lake Regional Office. SEC Complaint