SEC v. Dharma Teja Nukarapu; SharkDreams, Inc.; and D Dollar Inc., No. LR-25825, Eastern District of North Carolina (Sept. 12, 2023) — Press Release
raw: Dharma Teja Nukarapu, et al.
Dharma Teja Nukarapu, et al., No. 5:23-cv-00503 (Sept. 12, 2023)
summary
Dharma Teja Nukarapu and his entities, SharkDreams and D Dollar, were charged by the SEC for fraudulently raising $2.7 million through false claims and misappropriating $595,000 for personal use.
paragraph
The SEC charged Dharma Teja Nukarapu, SharkDreams, Inc., and D Dollar Inc. with orchestrating a scheme that raised approximately $2.7 million from over 20 investors through false valuation and product claims. Nukarapu is further alleged to have misappropriated $595,000 of funds raised by D Dollar to finance SharkDreams and his own personal expenses. The defendants face charges for violating the Securities Act of 1933 and the Exchange Act of 1934, with the SEC seeking disgorgement, penalties, and an officer and director bar.
narrative
The SEC has charged Dharma Teja Nukarapu, SharkDreams, Inc., and D Dollar Inc. with a fraudulent scheme involving approximately $2.7 million raised from more than 20 investors between 2018 and 2019. Nukarapu and SharkDreams allegedly made false claims regarding company valuations, purported LIVIT product revenue, and a non-existent buyout offer. Additionally, Nukarapu is accused of misappropriating $595,000 of the $650,000 raised by D Dollar to fund SharkDreams operations and personal expenses. The complaint alleges violations of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act. The SEC is seeking permanent injunctive relief, disgorgement with prejudgment interest, and civil penalties. Finally, the commission is pursuing an officer and director bar against Nukarapu.
Classified financial-fraud(confidence 95%). EDGAR detection: forms 10-K/10-Q/8-K/NT 10-K· recall 67% / precision 23%. detection rule →
Statutes
Parties
BRYANKROGER CO
Keywords
nukarapusharkdreamssecurities exchangesecuritiesexchangedharma tejateja nukarapusecexchange commissionnorth carolinainvestorsdollarsec'sdharmateja
Exhibits & Attached Documents (1)
Extracted insights
Dollar amounts 5
- $30.00M $30 million $10M–$100M
- $7.00M $7 million $1M–$10M
- $2.70M $2.7 million $1M–$10M
- $650K $650,000 $100K–$1M
- $595K $595,000 $100K–$1M
Entities 1
- agency Securities and Exchange Commission
Triples 10
- Securities And Exchange Commission charged Dharma Teja Nukarapu and SharkDreams, Inc. with fraudulently raising approximately $2.7 million from more than 20 investors through securities offerings from at least January 2018 to November 2019
- Securities And Exchange Commission charged D Dollar Inc. for its role in soliciting investor funds in 2019 and 2020 that were later misappropriated by Nukarapu
- SharkDreams and Nukarapu made multiple false and misleading statements to current and prospective investors about prior investors doubling their money, SharkDreams being valued at $7 million to $30 million, having customer orders for Livit products, and having a large investor to buy out shares
- D Dollar raised at least $650,000 from investors in 2019 and 2020
- Nukarapu misappropriated approximately $595,000 of investor proceeds to fund SharkDreams operations and for his personal uses
- Securities And Exchange Commission charges Nukarapu and SharkDreams with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder
- Securities And Exchange Commission charges Nukarapu as a control person for violations of Section 10(b) of the Exchange Act and Rule 10b-5 by SharkDreams and D Dollar pursuant to Section 20(a) of the Exchange Act
- Securities And Exchange Commission charges D Dollar with violations of Sections 17(a)(1) and (3) of the Securities Act, Section 10(b) of the Exchange Act, and Rules 10b-5(a) and (c) thereunder
- Securities And Exchange Commission seeks permanent injunctive relief, conduct-based injunctions, disgorgement with prejudgment interest, and civil penalties from all defendants
- Securities And Exchange Commission seeks an officer and director bar as to Nukarapu
PDF (from attached: complaint)
Text layers
Extracted body text (3,113c)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 25825 / September 12, 2023 Securities and Exchange Commission v. Dharma Teja Nukarapu, et al., No. 5:23-cv-00503-M (E.D.N.C. filed Sept. 11, 2023) SEC Charges North Carolina Man and Entities He Controlled with Fraud The Securities and Exchange Commission yesterday charged Dharma Teja Nukarapu, a resident of Apex, North Carolina and India, and the purported healthcare software development firm that he controlled, SharkDreams, Inc., with fraudulently raising approximately $2.7 million from more than 20 investors through securities offerings from at least January 2018 to November 2019. The SEC also charged D Dollar Inc. for its role in soliciting investor funds in 2019 and 2020 that were later misappropriated by Nukarapu. According to the SEC's complaint, SharkDreams and Nukarapu made multiple false and misleading statements to current and prospective investors in connection with the offer and sale of SharkDreams securities, including that prior investors had doubled their money in a year, that SharkDreams was valued at as much as $7 million to $30 million, that SharkDreams had customer orders for its LIVIT products, and that it had a large investor who would buy out all of the remaining SharkDreams shares to infuse capital. Allegedly, none of this was true. The SEC's complaint further alleges that SharkDreams never received any revenue from any LIVIT product sales, there was no factual basis for a valuation in the range Nukarapu touted, and there was never a bona fide offer to buy out SharkDreams shares. The SEC's complaint also alleges that, in 2019 and 2020, D Dollar raised at least $650,000 from investors. According to the SEC's complaint, investors were told that the funds would be used for a purported D Dollar subsidiary; but Nukarapu misappropriated approximately $595,000 of investor proceeds to fund SharkDreams operations and for his personal uses. The SEC’s complaint, filed in the U.S. District Court for the Eastern District of North Carolina, charges Nukarapu and SharkDreams with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder, and, in the alternative, charges that Nukarapu was liable as a control person for violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder by SharkDreams and D Dollar, pursuant to Section 20(a) of the Exchange Act. The SEC’s complaint also charges D Dollar with violations of Sections 17(a)(1) and (3) of the Securities Act, Section 10(b) of the Exchange Act, and Rules 10b-5(a) and (c) thereunder. The SEC’s complaint seeks from all defendants permanent injunctive relief, conduct-based injunctions, disgorgement with prejudgment interest, and civil penalties; the complaint also seeks an officer and director bar as to Nukarapu. The SEC's investigation was conducted by Delane Olson and Dan Furlano, under the supervision of Kevin Guerrero, Peter Rosario, and Stacy Bogert. The litigation will be handled by Peter Lallas under the supervision of James Connor. SEC Complaint
OCR text (3,113c · html-text · 99% conf)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 25825 / September 12, 2023 Securities and Exchange Commission v. Dharma Teja Nukarapu, et al., No. 5:23-cv-00503-M (E.D.N.C. filed Sept. 11, 2023) SEC Charges North Carolina Man and Entities He Controlled with Fraud The Securities and Exchange Commission yesterday charged Dharma Teja Nukarapu, a resident of Apex, North Carolina and India, and the purported healthcare software development firm that he controlled, SharkDreams, Inc., with fraudulently raising approximately $2.7 million from more than 20 investors through securities offerings from at least January 2018 to November 2019. The SEC also charged D Dollar Inc. for its role in soliciting investor funds in 2019 and 2020 that were later misappropriated by Nukarapu. According to the SEC's complaint, SharkDreams and Nukarapu made multiple false and misleading statements to current and prospective investors in connection with the offer and sale of SharkDreams securities, including that prior investors had doubled their money in a year, that SharkDreams was valued at as much as $7 million to $30 million, that SharkDreams had customer orders for its LIVIT products, and that it had a large investor who would buy out all of the remaining SharkDreams shares to infuse capital. Allegedly, none of this was true. The SEC's complaint further alleges that SharkDreams never received any revenue from any LIVIT product sales, there was no factual basis for a valuation in the range Nukarapu touted, and there was never a bona fide offer to buy out SharkDreams shares. The SEC's complaint also alleges that, in 2019 and 2020, D Dollar raised at least $650,000 from investors. According to the SEC's complaint, investors were told that the funds would be used for a purported D Dollar subsidiary; but Nukarapu misappropriated approximately $595,000 of investor proceeds to fund SharkDreams operations and for his personal uses. The SEC’s complaint, filed in the U.S. District Court for the Eastern District of North Carolina, charges Nukarapu and SharkDreams with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder, and, in the alternative, charges that Nukarapu was liable as a control person for violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder by SharkDreams and D Dollar, pursuant to Section 20(a) of the Exchange Act. The SEC’s complaint also charges D Dollar with violations of Sections 17(a)(1) and (3) of the Securities Act, Section 10(b) of the Exchange Act, and Rules 10b-5(a) and (c) thereunder. The SEC’s complaint seeks from all defendants permanent injunctive relief, conduct-based injunctions, disgorgement with prejudgment interest, and civil penalties; the complaint also seeks an officer and director bar as to Nukarapu. The SEC's investigation was conducted by Delane Olson and Dan Furlano, under the supervision of Kevin Guerrero, Peter Rosario, and Stacy Bogert. The litigation will be handled by Peter Lallas under the supervision of James Connor. SEC Complaint