SEC v. John R. Powell, No. LR-18281, Central District of California (Aug. 8, 2003) — Press Release
raw: John R. Powell
John R. Powell, No. LR-18281 (Aug. 8, 2003)
John R. Powell, a former stockbroker and movie producer, was indicted for lying to the SEC and obstruction of justice by falsely claiming negative net worth and no equity in his $3M+ Laguna Beach home while concealing a $428,000 cash-out refinance used to fund personal expenses, after previously being subject to a civil securities injunction.
John R. Powell was indicted in August 2003 for making false statements to the SEC and obstruction of justice during 2002 settlement negotiations. He submitted sworn financial statements falsely asserting negative net worth and no equity in his Laguna Beach residence, despite knowing it was appraised at over $3 million with at least $500,000 in equity. He also concealed that he had refinanced the property in February 2002 to withdraw $428,000 in cash, which he deposited into a film production company account he controlled and used to pay personal expenses, including his mortgage. The SEC had previously obtained a civil injunction against him in October 2002 for securities fraud violations.
John R. Powell, a former stockbroker and movie producer, was indicted in August 2003 for making false statements to the SEC and obstruction of justice during settlement discussions in 2002. He submitted two sworn financial statements claiming negative net worth and no equity in his Laguna Beach home, even though he knew the property had been appraised at over $3 million and held at least $500,000 in equity. Powell failed to disclose that he had refinanced the home in February 2002, withdrawing $428,000 in cash, which he deposited into a film production company account under his sole control. He then used funds from that account to pay his personal mortgage and living expenses, deliberately concealing this financial activity from the SEC. The SEC had previously obtained a civil injunction against him in October 2002 for violating securities registration and antifraud provisions under Sections 5(a), 5(c), 17(a) of the Securities Act and Section 10(b) and Rule 10b-5 of the Exchange Act. The criminal case, prosecuted by the U.S. Attorney’s Office for the Central District of California, charged him with lying to a federal agency and obstructing justice by fabricating his financial condition to reduce settlement obligations. His actions demonstrated a pattern of deception aimed at evading financial liability while continuing to benefit from his assets.
Extracted insights
- $3.00M $3 million $1M–$10M
- $1.75M $1,750,000 $1M–$10M
- $500K $500,000 $100K–$1M
- $428K $428,000 $100K–$1M
- agency for lying to the sec
- person john r. powell
- company this money directly into a bank account in the name of a film production company
- agency united states attorney's office for the central district of california
- court united states district court for the central district of california
- John R. Powell Indicted for lying to the SEC
- John R. Powell Submitted two sworn financial statements
- John R. Powell Claimed he had a negative net worth
- John R. Powell Knew his residence had been appraised at a value of over $3 million
- John R. Powell Refinanced his house in February 2002
- John R. Powell Withdrew more than $428,000 in cash from the property
- John R. Powell Deposited this money directly into a bank account in the name of a film production company
- John R. Powell Wrote checks on this bank account to pay for his monthly mortgage payments and other living expenses
- United States District Court for the Central District of California Entered an injunction prohibiting Powell from violating the securities registration and antifraud provisions of the federal securities laws
- United States Attorney's Office for the Central District of California Prosecuted the criminal case
Litigation Release No. 18281 / August 8, 2003 United States v. John R. Powell, Criminal Case No. CR 03-782 (C.D. Cal.) JOHN R. POWELL, MOVIE PRODUCER AND FORMER STOCKBROKER, INDICTED FOR LYING TO THE SEC On August 5, 2003, a federal grand jury indicted John R. Powell, former President of Irvine Securities, Inc. and currently a movie producer, for making false statements to the Securities and Exchange Commission. The indictment charges Powell with making false statements to a federal agency and obstruction of justice. The indictment alleges that during 2002, the Commission proposed settling a civil case filed by the Commission against Powell and others. During the course of settlement discussions, the Commission staff stated that it would consider waiving a portion of the proposed amount of disgorgement and an additional money penalty if Powell was unable to pay the full amount. The Commission required Powell to submit sworn financial statements demonstrating his inability to pay. Powell submitted two sworn financial statements, dated January 2002 and July 2002. The indictment alleges that in each of the financial statements, Powell claimed he had a negative net worth and that he had no equity in his Laguna Beach house because his mortgage was essentially equal to the property's "quick sale" market value. The indictment further alleges that Powell, in fact, knew at the time he submitted the January 2002 financial statements that his residence had been appraised at a value of over $3 million, that a mortgage lender would loan him at least $1,750,000 against the property, and that he had at least $500,000 in equity in the property. In Powell's July 2002 financial statements submitted to the Commission, Powell did not disclose that he had refinanced his house in February 2002 to withdraw more than $428,000 in cash from the property. Nor did the financial statements disclose that Powell deposited this money directly into a bank account in the name of a film production company that Powell owned and controlled. Powell subsequently wrote checks on this bank account to pay for his monthly mortgage payments and other living expenses. On October 10, 2002, in an action brought by the Commission, the United States District Court for the Central District of California entered an injunction prohibiting Powell from violating the securities registration and antifraud provisions of the federal securities laws, Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5. For more information, see Litigation Release Nos. 18182 (June 9, 2003), and 15822 (July 29, 1998). The criminal case is being prosecuted by the United States Attorney's Office for the Central District of California.
Litigation Release No. 18281 / August 8, 2003 United States v. John R. Powell, Criminal Case No. CR 03-782 (C.D. Cal.) JOHN R. POWELL, MOVIE PRODUCER AND FORMER STOCKBROKER, INDICTED FOR LYING TO THE SEC On August 5, 2003, a federal grand jury indicted John R. Powell, former President of Irvine Securities, Inc. and currently a movie producer, for making false statements to the Securities and Exchange Commission. The indictment charges Powell with making false statements to a federal agency and obstruction of justice. The indictment alleges that during 2002, the Commission proposed settling a civil case filed by the Commission against Powell and others. During the course of settlement discussions, the Commission staff stated that it would consider waiving a portion of the proposed amount of disgorgement and an additional money penalty if Powell was unable to pay the full amount. The Commission required Powell to submit sworn financial statements demonstrating his inability to pay. Powell submitted two sworn financial statements, dated January 2002 and July 2002. The indictment alleges that in each of the financial statements, Powell claimed he had a negative net worth and that he had no equity in his Laguna Beach house because his mortgage was essentially equal to the property's "quick sale" market value. The indictment further alleges that Powell, in fact, knew at the time he submitted the January 2002 financial statements that his residence had been appraised at a value of over $3 million, that a mortgage lender would loan him at least $1,750,000 against the property, and that he had at least $500,000 in equity in the property. In Powell's July 2002 financial statements submitted to the Commission, Powell did not disclose that he had refinanced his house in February 2002 to withdraw more than $428,000 in cash from the property. Nor did the financial statements disclose that Powell deposited this money directly into a bank account in the name of a film production company that Powell owned and controlled. Powell subsequently wrote checks on this bank account to pay for his monthly mortgage payments and other living expenses. On October 10, 2002, in an action brought by the Commission, the United States District Court for the Central District of California entered an injunction prohibiting Powell from violating the securities registration and antifraud provisions of the federal securities laws, Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5. For more information, see Litigation Release Nos. 18182 (June 9, 2003), and 15822 (July 29, 1998). The criminal case is being prosecuted by the United States Attorney's Office for the Central District of California.