In re MICHAEL SEALY

 
 UNITED STATES OF AMERICA 
 Before the 
 SECURITIES AND EXCHANGE COMMISSION 
 
SECURITIES EXCHANGE ACT OF 1934 
Release No. 102233 / January 17, 2025 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-22434 
 
 
In the Matter of 
 
MICHAEL SEALY, 
 
Respondent. 
 
 
 
 
ORDER INSTITUTING ADMINISTRATIVE 
AND CEASE-AND-DESIST PROCEEDINGS, 
PURSUANT TO SECTIONS 15(b) AND 21C 
OF THE SECURITIES EXCHANGE ACT OF 
1934, MAKING FINDINGS, AND IMPOSING 
REMEDIAL SANCTIONS AND A 
CEASE-AND-DESIST ORDER  
   
 
I. 
 
 The Securities and Exchange Commission (“Commission”) deems it appropriate and in the 
public interest that public administrative and cease-and-desist proceedings be, and hereby are, 
instituted pursuant to Sections 15(b) and 21C of the Securities Exchange Act of 1934 (“Exchange 
Act”) against Michael Sealy (“Sealy” or “Respondent”).   
 
II. 
 
 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 
of Settlement (the “Offer”) which the Commission has determined to accept.  Solely for the 
purpose of these proceedings and any other proceedings brought by or on behalf of the 
Commission, or to which the Commission is a party, and without admitting or denying the findings 
herein, except as to the Commission’s jurisdiction over him and the subject matter of these 
proceedings, which are admitted, and except as provided herein in Section V, Respondent consents 
to the entry of this Order Instituting Administrative and Cease-and-Desist Proceedings, Pursuant to 
Sections 15(b) and 21C of the Securities Exchange Act of 1934 Making Findings, and Imposing 
Remedial Sanctions and a Cease-and-Desist Order (“Order”), as set forth below. 
 

 2 
III. 
 
 On the basis of this Order and Respondent’s Offer, the Commission finds
1
 that: 
 
Summary 
 
 This proceeding arises from an offering fraud scheme perpetrated by Richard Dale Sterritt, 
Jr., also known as “Rich Richman” (“Sterritt”), and other individuals, in which they raised at least 
$16 million from over 300 investors through unregistered and fraudulent sales of shares of a 
privately held purported oil-and-gas company, Zona Energy, Inc. (“Zona”).   
 
Between approximately August 2018 and October 2019 (the “Relevant Period”), Sealy acted 
as an unregistered broker on behalf of Zona, soliciting multiple investors through his network of 
business contacts.  In return for soliciting investors and brokering investment transactions in Zona, 
Sealy received transaction-based compensation in the form of deeply discounted Zona shares.  
Additionally, Sealy aided and abetted and caused registered representatives to engage in “selling 
away”
2
 of Zona shares. 
 
Respondent 
 
1. Michael Sealy, age 48, resides in Dallas, Texas.  Sealy has been an employee of a 
family-owned real estate investment and operations firm since 1999.  He holds a real estate license.  
Sealy has never been associated with any broker-dealer registered with the Commission and has 
never held any securities licenses.  Sealy participated in an offering of Zona stock, which was a 
penny stock. 
 
Other Relevant Individuals and Entities 
 
2. Zona was a privately held Texas corporation with its principal place of business in 
Dallas, Texas.  Zona was never registered with the Commission, nor did it ever register or attempt 
to register any offering of securities under the Securities Act of 1933 (“Securities Act”) or any 
class of securities under the Exchange Act.  During the Relevant Period, Zona was a penny stock.  
 
3. Sterritt, age 64, is currently incarcerated at the Metropolitan Detention Center in 
Brooklyn, NY.  He has never been registered with the Commission in any capacity nor held any 
securities licenses.  In April 2003, Sterritt pleaded guilty to an indictment charging him with 
conspiracy to commit securities fraud, money laundering, and filing false income tax returns.  He 
was sentenced to five years’ imprisonment.  On April 14, 2021, the Commission filed a complaint 
in federal district court charging Sterritt with violations of Sections 5(a), 5(c), and 17(a) of the 
                                                 
1
  The findings herein are made pursuant to Respondent’s Offer and are not binding on any 
other person or entity in this or any other proceeding. 
 
2
  “Selling away” occurs when a person associated with a broker-dealer sells securities  
without the knowledge or supervision of the broker-dealer. 

 3 
Securities Act, and Sections 9(a), 15(a), and 10(b) of the Exchange Act, and Rule 10b-5 
thereunder, in connection with his Zona-related conduct; this action is pending.  SEC v. Richard 
Dale Sterritt, Jr., et al., 1:21-cv-02008 (KAM-LKE) (E.D.N.Y.).  On November 27, 2023, Sterritt 
pleaded guilty to conspiracy to commit securities and wire fraud, multiple counts of securities 
fraud, and conspiracy to commit money laundering, in connection with his Zona-related conduct.  
United States v. Richard Dale Sterritt, Jr., et al., 1:21-cr-00193 (KAM) (E.D.N.Y.) (Dkt. No. 345) 
(filed Apr. 8, 2021).   
 
4. James Christopher Pittman (“Pittman”), age 49, resides in Dallas, Texas.  He is 
a lawyer, barred in Texas since 1999, and a managing member and co-founder of Pittman & 
Harrison PLLC.  He has never been registered with the Commission in any capacity and does not 
hold any securities licenses.  On April 14, 2021, the Commission charged Pittman with violations 
of Sections 5(a), 5(c), 17(a)(1), and 17(a)(3) of the Securities Act and Sections 15(a) and 10(b) of 
the Exchange Act and Rules 10b-5(a) and (c) thereunder, in connection with his Zona-related 
conduct; this action is pending.  SEC v. Richard Dale Sterritt, Jr., et al., 1:21-cv-02008 (KAM-
LKE) (E.D.N.Y.).  On October 13, 2023, Pittman pleaded guilty to conspiracy to commit securities 
fraud and conspiracy to commit wire fraud in connection with his Zona-related conduct in U.S. v. 
Richard Dale Sterritt, Jr., et al., 1:21-cr-00193 (KAM) (E.D.N.Y.) (Dkt. No. 314) (filed Apr. 8, 
2021). 
 
5. Arete Wealth Management LLC (“Arete Wealth”) is a limited liability company 
headquartered in Chicago, Illinois.  It has been registered with the Commission as a broker-dealer 
since 1998.  
 
6. Arete Wealth Advisers LLC (“Arete Advisor”) (together with Arete Wealth, 
“Arete”), is a limited liability company headquartered in Chicago, Illinois.  It has been a registered 
investment adviser with the Commission since 2009, and has over $2.5 billion in regulatory assets 
under management.  
 
7. Joey Miller (“Miller”), age 47, resides in New Braunfels, Texas.  Miller is a 
registered representative and investment adviser representative who was associated with Arete 
from 2014 until October 2023.  Miller is the founder and principal of John Galt Wealth Solutions, a 
private wealth management firm that formerly operated as a branch office of Arete.   
 
8. Jeffrey Scott Larson (“Larson”), age 41, resides in Fenton, Missouri.  Larson was 
a registered representative and investment adviser representative associated with Arete from 2017 
through October 2023.  He is the managing partner and co-founder of 25 Financial, a private 
wealth management firm that formerly operated as a branch office of Arete.   
 
Background 
 
9. From March 2018 through at least November 2020, Sterritt, with the help of other 
individuals, raised more than $16 million from more than 300 investors through unregistered and 
fraudulent sales of shares of Zona.  Shares of Zona were securities. 
 

 4 
10. During the Relevant Period, Sealy acted as a broker for transactions of Zona shares.  
 
11. Pittman, a friend of Sealy, first introduced Sealy to Zona.   
 
12. Thereafter, Sealy personally invested in Zona and identified and solicited a number 
of business contacts as prospective Zona investors.  He engaged in activities including emailing 
potential investors about Zona, providing potential investors with Zona marketing materials, 
discussing the merits of a Zona investment with potential investors, and emailing pricing 
information provided by Zona-affiliated persons to potential investors.  Sealy also requested for 
Zona employees to send Zona offering materials and subscription agreements to potential investors 
and put potential investors in touch with Zona employees to answer their questions concerning 
such documentation.  During the Relevant Period, investors that Sealy directly solicited were 
generally offered Zona shares at prices ranging from $0.50 to $2.50 per share.   
 
13. Sterritt (known to Sealy at the time as “Rich Richman”),
3
 Pittman, and Sealy agreed 
that Sealy would receive compensation in the form of cash and discounted shares in exchange for 
soliciting Zona investors.  Ultimately, Sealy never received cash compensation, but he was 
compensated in the form of heavily discounted shares, purchasing hundreds of thousands of shares 
for $0.01 per share.  
 
14. One of the investors Sealy solicited was Miller, who subsequently purchased Zona 
shares.  Miller and Sealy were acquainted through Miller’s work at Arete. 
 
15. Miller introduced the Zona investment opportunity to his Arete colleague, Larson, 
who also personally invested in Zona.  With Sealy’s knowledge and involvement, Miller and 
Larson then solicited numerous additional Zona investors, the majority of whom were their clients 
and customers through Arete.  Miller and Larson agreed with Sterritt, Pittman, and Sealy to raise 
capital for Zona.  Miller, Larson, and Zona employees tracked the amount of funds that Miller and 
Larson raised in order to receive credit for their solicitations and Zona employees shared that 
information with Sealy.  When there was a disagreement between Miller and Larson and Sterritt 
over the amount of capital that Miller and Larson had agreed to raise, a Zona employee requested 
in an email that Pittman and Sealy clarify the confusion.  Miller and Larson ultimately raised over 
$5 million for Zona, and were compensated for their fundraising efforts in the form of deeply 
discounted Zona shares, purchasing Zona shares for as little as $0.04 per share. 
 
16. During the Relevant Period, Sealy knew or should have known that Miller and 
Larson were acting outside of their employment at Arete and were therefore violating the securities 
laws and FINRA rules by selling these securities.   
 
17. Sterritt misappropriated nearly all of the investor funds raised, using them for his 
unrelated businesses, to wire money to friends and family, to withdraw cash for himself, and on 
various luxury purchases and personal expenses. 
                                                 
3
  On or around January 22, 2020, Sealy and other investors received an anonymous email 
stating that “Richard Richman” was an alias of Sterritt.  

 5 
18. Section 3(a)(4) of the Exchange Act defines a “broker” as any person engaged in 
the business of effecting transactions in securities for the accounts of others.  
 
19. Absent an applicable exception or exemption, Section 15(a)(1) of the Exchange Act 
generally prohibits a broker or dealer from making use of the mails or any means or instrumentality 
of interstate commerce to effect any transactions in, or to induce or attempt to induce the purchase 
or sale of any security unless the broker or dealer is registered with the Commission in accordance 
with Section 15(b) of the Exchange Act or is a natural person associated with a registered broker or 
dealer. 
 
20. At no time during the Relevant Period was Sealy registered with the Commission as 
a broker or dealer or as a person associated with a registered broker or dealer. 
 
21. As a result of the conduct described above, Respondent willfully
4
 violated, and 
willfully aided and abetted and caused Miller and Larson’s violations of, Section 15(a) of the 
Exchange Act. 
 
IV. 
 In view of the foregoing, the Commission deems it appropriate and in the public interest to 
impose the sanctions agreed to in Respondent’s Offer. 
 
 Accordingly, pursuant to Sections 15(b) and 21C of the Exchange Act, it is hereby 
ORDERED that: 
 
 A. Respondent Sealy cease and desist from committing or causing any violations and 
any future violations of Section 15(a) of the Exchange Act. 
 
B. Respondent Sealy be, and hereby is: 
suspended from participating in any offering of a penny stock, including: 
acting as a promoter, finder, consultant, agent or other person who 
engages in activities with a broker, dealer or issuer for purposes of the 
issuance or trading in any penny stock, or inducing or attempting to induce 
the purchase or sale of any penny stock, for a period of 12 months, 
effective on the second Monday following the entry of this order. 
C. Respondent Sealy shall, within 21 days of the entry of this Order, pay a civil money 
penalty in the amount of $200,000.00 to the Securities and Exchange Commission.  The 
Commission may distribute civil money penalties collected in this proceeding if, in its discretion, 
the Commission orders the establishment of a Fair Fund pursuant to 15 U.S.C. § 7246, Section 
308(a) of the Sarbanes-Oxley Act of 2002.  The Commission will hold funds paid pursuant to this 
                                                 
4
 “Willfully,” for purposes of imposing relief under Section 15(b) of the Exchange Act, “‘means no more 
than that the person charged with the duty knows what he is doing.’” Wonsover v. SEC, 205 F.3d 408, 
414 (D.C. Cir. 2000) (quoting Hughes v. SEC, 174 F.2d 969, 977 (D.C. Cir. 1949)). 

 6 
paragraph in an account at the United States Treasury pending a decision whether the Commission, 
in its discretion, will seek to distribute funds or, subject to Exchange Act Section 21F(g)(3), 
transfer them to the general fund of the United States Treasury.  If timely payment is not made, 
additional interest shall accrue pursuant to 31 U.S.C. § 3717.   
 
Payment must be made in one of the following ways:   
 
(1) Respondent may transmit payment electronically to the Commission, which 
will provide detailed ACH transfer/Fedwire instructions upon request;  
 
(2) Respondent may make direct payment from a bank account via Pay.gov 
through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  
 
(3) Respondent may pay by certified check, bank cashier’s check, or United 
States postal money order, made payable to the Securities and Exchange 
Commission and hand-delivered or mailed to:  
 
Enterprise Services Center 
Accounts Receivable Branch 
HQ Bldg., Room 181, AMZ-341 
6500 South MacArthur Boulevard 
Oklahoma City, OK 73169 
 
Payments by check or money order must be accompanied by a cover letter identifying 
Michael Sealy as a Respondent in these proceedings, and the file number of these proceedings; a 
copy of the cover letter and check or money order must be sent to Sheldon L. Pollock, Associate 
Director, Securities and Exchange Commission, New York Regional Office, 100 Pearl Street, 
Suite 20-100, New York, NY 10004.  
 
 D.  Regardless of whether the Commission in its discretion orders the creation of a 
Fair Fund for the penalties ordered in this proceeding, amounts ordered to be paid as civil money 
penalties pursuant to this Order shall be treated as penalties paid to the government for all 
purposes, including all tax purposes.  To preserve the deterrent effect of the civil penalty, 
Respondent agrees that in any Related Investor Action, he shall not argue that he is entitled to, nor 
shall he benefit by, offset or reduction of any award of compensatory damages by the amount of 
any part of Respondent’s payment of a civil penalty in this action (“Penalty Offset”).  If the court 
in any Related Investor Action grants such a Penalty Offset, Respondent agrees that he shall, 
within 30 days after entry of a final order granting the Penalty Offset, notify the Commission's 
counsel in this action and pay the amount of the Penalty Offset to the Securities and Exchange 
Commission.  Such a payment shall not be deemed an additional civil penalty and shall not be 
deemed to change the amount of the civil penalty imposed in this proceeding.  For purposes of this 
paragraph, a “Related Investor Action” means a private damages action brought against 
Respondent by or on behalf of one or more investors based on substantially the same facts as 
alleged in the Order instituted by the Commission in this proceeding. 
 

 7 
V. 
It is further Ordered that, solely for purposes of exceptions to discharge set forth in Section 
523 of the Bankruptcy Code, 11 U.S.C. § 523, the findings in this Order are true and admitted by 
Respondent, and further, any debt for disgorgement, prejudgment interest, civil penalty or other 
amounts due by Respondent under this Order or any other judgment, order, consent order, decree 
or settlement agreement entered in connection with this proceeding, is a debt for the violation by 
Respondent of the federal securities laws or any regulation or order issued under such laws, as set 
forth in Section 523(a)(19) of the Bankruptcy Code, 11 U.S.C. § 523(a)(19). 
 
 By the Commission. 
 
 
 
Vanessa A. Countryman 
        Secretary 
 
 
 

UNITED STATES OF AMERICA 

 Before the 

 SECURITIES AND EXCHANGE COMMISSION 

 

SECURITIES EXCHANGE ACT OF 1934 

Release No. 102233 / January 17, 2025 

 

ADMINISTRATIVE PROCEEDING 

File No. 3-22434 

 

 

In the Matter of 

 

MICHAEL SEALY, 

 

Respondent. 

 

 

 

 

ORDER INSTITUTING ADMINISTRATIVE 

AND CEASE-AND-DESIST PROCEEDINGS, 

PURSUANT TO SECTIONS 15(b) AND 21C 

OF THE SECURITIES EXCHANGE ACT OF 

1934, MAKING FINDINGS, AND IMPOSING 

REMEDIAL SANCTIONS AND A 

CEASE-AND-DESIST ORDER  

   

 

I. 

 

 The Securities and Exchange Commission (“Commission”) deems it appropriate and in the 

public interest that public administrative and cease-and-desist proceedings be, and hereby are, 

instituted pursuant to Sections 15(b) and 21C of the Securities Exchange Act of 1934 (“Exchange 

Act”) against Michael Sealy (“Sealy” or “Respondent”).   

 

II. 

 

 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 

of Settlement (the “Offer”) which the Commission has determined to accept.  Solely for the 

purpose of these proceedings and any other proceedings brought by or on behalf of the 

Commission, or to which the Commission is a party, and without admitting or denying the findings 

herein, except as to the Commission’s jurisdiction over him and the subject matter of these 

proceedings, which are admitted, and except as provided herein in Section V, Respondent consents 

to the entry of this Order Instituting Administrative and Cease-and-Desist Proceedings, Pursuant to 

Sections 15(b) and 21C of the Securities Exchange Act of 1934 Making Findings, and Imposing 

Remedial Sanctions and a Cease-and-Desist Order (“Order”), as set forth below. 

 



 2 

III. 

 

 On the basis of this Order and Respondent’s Offer, the Commission finds1 that: 

 

Summary 

 

 This proceeding arises from an offering fraud scheme perpetrated by Richard Dale Sterritt, 

Jr., also known as “Rich Richman” (“Sterritt”), and other individuals, in which they raised at least 

$16 million from over 300 investors through unregistered and fraudulent sales of shares of a 

privately held purported oil-and-gas company, Zona Energy, Inc. (“Zona”).   

 

Between approximately August 2018 and October 2019 (the “Relevant Period”), Sealy acted 

as an unregistered broker on behalf of Zona, soliciting multiple investors through his network of 

business contacts.  In return for soliciting investors and brokering investment transactions in Zona, 

Sealy received transaction-based compensation in the form of deeply discounted Zona shares.  

Additionally, Sealy aided and abetted and caused registered representatives to engage in “selling 

away”2 of Zona shares. 

 

Respondent 

 

1. Michael Sealy, age 48, resides in Dallas, Texas.  Sealy has been an employee of a 

family-owned real estate investment and operations firm since 1999.  He holds a real estate license.  

Sealy has never been associated with any broker-dealer registered with the Commission and has 

never held any securities licenses.  Sealy participated in an offering of Zona stock, which was a 

penny stock. 

 

Other Relevant Individuals and Entities 

 

2. Zona was a privately held Texas corporation with its principal place of business in 

Dallas, Texas.  Zona was never registered with the Commission, nor did it ever register or attempt 

to register any offering of securities under the Securities Act of 1933 (“Securities Act”) or any 

class of securities under the Exchange Act.  During the Relevant Period, Zona was a penny stock.  

 

3. Sterritt, age 64, is currently incarcerated at the Metropolitan Detention Center in 

Brooklyn, NY.  He has never been registered with the Commission in any capacity nor held any 

securities licenses.  In April 2003, Sterritt pleaded guilty to an indictment charging him with 

conspiracy to commit securities fraud, money laundering, and filing false income tax returns.  He 

was sentenced to five years’ imprisonment.  On April 14, 2021, the Commission filed a complaint 

in federal district court charging Sterritt with violations of Sections 5(a), 5(c), and 17(a) of the 

                                                 
1  The findings herein are made pursuant to Respondent’s Offer and are not binding on any 

other person or entity in this or any other proceeding. 

 
2  “Selling away” occurs when a person associated with a broker-dealer sells securities  

without the knowledge or supervision of the broker-dealer. 



 3 

Securities Act, and Sections 9(a), 15(a), and 10(b) of the Exchange Act, and Rule 10b-5 

thereunder, in connection with his Zona-related conduct; this action is pending.  SEC v. Richard 

Dale Sterritt, Jr., et al., 1:21-cv-02008 (KAM-LKE) (E.D.N.Y.).  On November 27, 2023, Sterritt 

pleaded guilty to conspiracy to commit securities and wire fraud, multiple counts of securities 

fraud, and conspiracy to commit money laundering, in connection with his Zona-related conduct.  

United States v. Richard Dale Sterritt, Jr., et al., 1:21-cr-00193 (KAM) (E.D.N.Y.) (Dkt. No. 345) 

(filed Apr. 8, 2021).   

 

4. James Christopher Pittman (“Pittman”), age 49, resides in Dallas, Texas.  He is 

a lawyer, barred in Texas since 1999, and a managing member and co-founder of Pittman & 

Harrison PLLC.  He has never been registered with the Commission in any capacity and does not 

hold any securities licenses.  On April 14, 2021, the Commission charged Pittman with violations 

of Sections 5(a), 5(c), 17(a)(1), and 17(a)(3) of the Securities Act and Sections 15(a) and 10(b) of 

the Exchange Act and Rules 10b-5(a) and (c) thereunder, in connection with his Zona-related 

conduct; this action is pending.  SEC v. Richard Dale Sterritt, Jr., et al., 1:21-cv-02008 (KAM-

LKE) (E.D.N.Y.).  On October 13, 2023, Pittman pleaded guilty to conspiracy to commit securities 

fraud and conspiracy to commit wire fraud in connection with his Zona-related conduct in U.S. v. 

Richard Dale Sterritt, Jr., et al., 1:21-cr-00193 (KAM) (E.D.N.Y.) (Dkt. No. 314) (filed Apr. 8, 

2021). 

 

5. Arete Wealth Management LLC (“Arete Wealth”) is a limited liability company 

headquartered in Chicago, Illinois.  It has been registered with the Commission as a broker-dealer 

since 1998.  

 

6. Arete Wealth Advisers LLC (“Arete Advisor”) (together with Arete Wealth, 

“Arete”), is a limited liability company headquartered in Chicago, Illinois.  It has been a registered 

investment adviser with the Commission since 2009, and has over $2.5 billion in regulatory assets 

under management.  

 

7. Joey Miller (“Miller”), age 47, resides in New Braunfels, Texas.  Miller is a 

registered representative and investment adviser representative who was associated with Arete 

from 2014 until October 2023.  Miller is the founder and principal of John Galt Wealth Solutions, a 

private wealth management firm that formerly operated as a branch office of Arete.   

 

8. Jeffrey Scott Larson (“Larson”), age 41, resides in Fenton, Missouri.  Larson was 

a registered representative and investment adviser representative associated with Arete from 2017 

through October 2023.  He is the managing partner and co-founder of 25 Financial, a private 

wealth management firm that formerly operated as a branch office of Arete.   

 

Background 

 

9. From March 2018 through at least November 2020, Sterritt, with the help of other 

individuals, raised more than $16 million from more than 300 investors through unregistered and 

fraudulent sales of shares of Zona.  Shares of Zona were securities. 

 



 4 

10. During the Relevant Period, Sealy acted as a broker for transactions of Zona shares.  

 

11. Pittman, a friend of Sealy, first introduced Sealy to Zona.   

 

12. Thereafter, Sealy personally invested in Zona and identified and solicited a number 

of business contacts as prospective Zona investors.  He engaged in activities including emailing 

potential investors about Zona, providing potential investors with Zona marketing materials, 

discussing the merits of a Zona investment with potential investors, and emailing pricing 

information provided by Zona-affiliated persons to potential investors.  Sealy also requested for 

Zona employees to send Zona offering materials and subscription agreements to potential investors 

and put potential investors in touch with Zona employees to answer their questions concerning 

such documentation.  During the Relevant Period, investors that Sealy directly solicited were 

generally offered Zona shares at prices ranging from $0.50 to $2.50 per share.   

 

13. Sterritt (known to Sealy at the time as “Rich Richman”),3 Pittman, and Sealy agreed 

that Sealy would receive compensation in the form of cash and discounted shares in exchange for 

soliciting Zona investors.  Ultimately, Sealy never received cash compensation, but he was 

compensated in the form of heavily discounted shares, purchasing hundreds of thousands of shares 

for $0.01 per share.  

 

14. One of the investors Sealy solicited was Miller, who subsequently purchased Zona 

shares.  Miller and Sealy were acquainted through Miller’s work at Arete. 

 

15. Miller introduced the Zona investment opportunity to his Arete colleague, Larson, 

who also personally invested in Zona.  With Sealy’s knowledge and involvement, Miller and 

Larson then solicited numerous additional Zona investors, the majority of whom were their clients 

and customers through Arete.  Miller and Larson agreed with Sterritt, Pittman, and Sealy to raise 

capital for Zona.  Miller, Larson, and Zona employees tracked the amount of funds that Miller and 

Larson raised in order to receive credit for their solicitations and Zona employees shared that 

information with Sealy.  When there was a disagreement between Miller and Larson and Sterritt 

over the amount of capital that Miller and Larson had agreed to raise, a Zona employee requested 

in an email that Pittman and Sealy clarify the confusion.  Miller and Larson ultimately raised over 

$5 million for Zona, and were compensated for their fundraising efforts in the form of deeply 

discounted Zona shares, purchasing Zona shares for as little as $0.04 per share. 

 

16. During the Relevant Period, Sealy knew or should have known that Miller and 

Larson were acting outside of their employment at Arete and were therefore violating the securities 

laws and FINRA rules by selling these securities.   

 

17. Sterritt misappropriated nearly all of the investor funds raised, using them for his 

unrelated businesses, to wire money to friends and family, to withdraw cash for himself, and on 

various luxury purchases and personal expenses. 

                                                 
3  On or around January 22, 2020, Sealy and other investors received an anonymous email 

stating that “Richard Richman” was an alias of Sterritt.  



 5 

18. Section 3(a)(4) of the Exchange Act defines a “broker” as any person engaged in 

the business of effecting transactions in securities for the accounts of others.  

 

19. Absent an applicable exception or exemption, Section 15(a)(1) of the Exchange Act 

generally prohibits a broker or dealer from making use of the mails or any means or instrumentality 

of interstate commerce to effect any transactions in, or to induce or attempt to induce the purchase 

or sale of any security unless the broker or dealer is registered with the Commission in accordance 

with Section 15(b) of the Exchange Act or is a natural person associated with a registered broker or 

dealer. 

 

20. At no time during the Relevant Period was Sealy registered with the Commission as 

a broker or dealer or as a person associated with a registered broker or dealer. 

 

21. As a result of the conduct described above, Respondent willfully4 violated, and 

willfully aided and abetted and caused Miller and Larson’s violations of, Section 15(a) of the 

Exchange Act. 

 

IV. 

 In view of the foregoing, the Commission deems it appropriate and in the public interest to 

impose the sanctions agreed to in Respondent’s Offer. 

 

 Accordingly, pursuant to Sections 15(b) and 21C of the Exchange Act, it is hereby 

ORDERED that: 

 

 A. Respondent Sealy cease and desist from committing or causing any violations and 

any future violations of Section 15(a) of the Exchange Act. 

 

B. Respondent Sealy be, and hereby is: 

suspended from participating in any offering of a penny stock, including: 

acting as a promoter, finder, consultant, agent or other person who 

engages in activities with a broker, dealer or issuer for purposes of the 

issuance or trading in any penny stock, or inducing or attempting to induce 

the purchase or sale of any penny stock, for a period of 12 months, 

effective on the second Monday following the entry of this order. 

C. Respondent Sealy shall, within 21 days of the entry of this Order, pay a civil money 

penalty in the amount of $200,000.00 to the Securities and Exchange Commission.  The 

Commission may distribute civil money penalties collected in this proceeding if, in its discretion, 

the Commission orders the establishment of a Fair Fund pursuant to 15 U.S.C. § 7246, Section 

308(a) of the Sarbanes-Oxley Act of 2002.  The Commission will hold funds paid pursuant to this 

                                                 
4 “Willfully,” for purposes of imposing relief under Section 15(b) of the Exchange Act, “‘means no more 

than that the person charged with the duty knows what he is doing.’” Wonsover v. SEC, 205 F.3d 408, 

414 (D.C. Cir. 2000) (quoting Hughes v. SEC, 174 F.2d 969, 977 (D.C. Cir. 1949)). 



 6 

paragraph in an account at the United States Treasury pending a decision whether the Commission, 

in its discretion, will seek to distribute funds or, subject to Exchange Act Section 21F(g)(3), 

transfer them to the general fund of the United States Treasury.  If timely payment is not made, 

additional interest shall accrue pursuant to 31 U.S.C. § 3717.   

 

Payment must be made in one of the following ways:   

 

(1) Respondent may transmit payment electronically to the Commission, which 

will provide detailed ACH transfer/Fedwire instructions upon request;  

 

(2) Respondent may make direct payment from a bank account via Pay.gov 

through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  

 

(3) Respondent may pay by certified check, bank cashier’s check, or United 

States postal money order, made payable to the Securities and Exchange 

Commission and hand-delivered or mailed to:  

 

Enterprise Services Center 

Accounts Receivable Branch 

HQ Bldg., Room 181, AMZ-341 

6500 South MacArthur Boulevard 

Oklahoma City, OK 73169 

 

Payments by check or money order must be accompanied by a cover letter identifying 

Michael Sealy as a Respondent in these proceedings, and the file number of these proceedings; a 

copy of the cover letter and check or money order must be sent to Sheldon L. Pollock, Associate 

Director, Securities and Exchange Commission, New York Regional Office, 100 Pearl Street, 

Suite 20-100, New York, NY 10004.  

 

 D.  Regardless of whether the Commission in its discretion orders the creation of a 

Fair Fund for the penalties ordered in this proceeding, amounts ordered to be paid as civil money 

penalties pursuant to this Order shall be treated as penalties paid to the government for all 

purposes, including all tax purposes.  To preserve the deterrent effect of the civil penalty, 

Respondent agrees that in any Related Investor Action, he shall not argue that he is entitled to, nor 

shall he benefit by, offset or reduction of any award of compensatory damages by the amount of 

any part of Respondent’s payment of a civil penalty in this action (“Penalty Offset”).  If the court 

in any Related Investor Action grants such a Penalty Offset, Respondent agrees that he shall, 

within 30 days after entry of a final order granting the Penalty Offset, notify the Commission's 

counsel in this action and pay the amount of the Penalty Offset to the Securities and Exchange 

Commission.  Such a payment shall not be deemed an additional civil penalty and shall not be 

deemed to change the amount of the civil penalty imposed in this proceeding.  For purposes of this 

paragraph, a “Related Investor Action” means a private damages action brought against 

Respondent by or on behalf of one or more investors based on substantially the same facts as 

alleged in the Order instituted by the Commission in this proceeding. 

 



 7 

V. 

It is further Ordered that, solely for purposes of exceptions to discharge set forth in Section 

523 of the Bankruptcy Code, 11 U.S.C. § 523, the findings in this Order are true and admitted by 

Respondent, and further, any debt for disgorgement, prejudgment interest, civil penalty or other 

amounts due by Respondent under this Order or any other judgment, order, consent order, decree 

or settlement agreement entered in connection with this proceeding, is a debt for the violation by 

Respondent of the federal securities laws or any regulation or order issued under such laws, as set 

forth in Section 523(a)(19) of the Bankruptcy Code, 11 U.S.C. § 523(a)(19). 

 

 By the Commission. 

 

 

 

Vanessa A. Countryman 

        Secretary 

 

 

 


	UNITED STATES OF AMERICA
	Respondent
	1. Michael Sealy, age 48, resides in Dallas, Texas.  Sealy has been an employee of a family-owned real estate investment and operations firm since 1999.  He holds a real estate license.  Sealy has never been associated with any broker-dealer registere...
	Other Relevant Individuals and Entities
	2. Zona was a privately held Texas corporation with its principal place of business in Dallas, Texas.  Zona was never registered with the Commission, nor did it ever register or attempt to register any offering of securities under the Securities Act o...
	3. Sterritt, age 64, is currently incarcerated at the Metropolitan Detention Center in Brooklyn, NY.  He has never been registered with the Commission in any capacity nor held any securities licenses.  In April 2003, Sterritt pleaded guilty to an indi...
	4. James Christopher Pittman (“Pittman”), age 49, resides in Dallas, Texas.  He is a lawyer, barred in Texas since 1999, and a managing member and co-founder of Pittman & Harrison PLLC.  He has never been registered with the Commission in any capacity...
	5. Arete Wealth Management LLC (“Arete Wealth”) is a limited liability company headquartered in Chicago, Illinois.  It has been registered with the Commission as a broker-dealer since 1998.
	6. Arete Wealth Advisers LLC (“Arete Advisor”) (together with Arete Wealth, “Arete”), is a limited liability company headquartered in Chicago, Illinois.  It has been a registered investment adviser with the Commission since 2009, and has over $2.5 bil...
	7. Joey Miller (“Miller”), age 47, resides in New Braunfels, Texas.  Miller is a registered representative and investment adviser representative who was associated with Arete from 2014 until October 2023.  Miller is the founder and principal of John G...
	8. Jeffrey Scott Larson (“Larson”), age 41, resides in Fenton, Missouri.  Larson was a registered representative and investment adviser representative associated with Arete from 2017 through October 2023.  He is the managing partner and co-founder of ...

	Background
	9. From March 2018 through at least November 2020, Sterritt, with the help of other individuals, raised more than $16 million from more than 300 investors through unregistered and fraudulent sales of shares of Zona.  Shares of Zona were securities.
	10. During the Relevant Period, Sealy acted as a broker for transactions of Zona shares.
	11. Pittman, a friend of Sealy, first introduced Sealy to Zona.
	12. Thereafter, Sealy personally invested in Zona and identified and solicited a number of business contacts as prospective Zona investors.  He engaged in activities including emailing potential investors about Zona, providing potential investors with...
	13. Sterritt (known to Sealy at the time as “Rich Richman”),  Pittman, and Sealy agreed that Sealy would receive compensation in the form of cash and discounted shares in exchange for soliciting Zona investors.  Ultimately, Sealy never received cash c...
	14. One of the investors Sealy solicited was Miller, who subsequently purchased Zona shares.  Miller and Sealy were acquainted through Miller’s work at Arete.
	15. Miller introduced the Zona investment opportunity to his Arete colleague, Larson, who also personally invested in Zona.  With Sealy’s knowledge and involvement, Miller and Larson then solicited numerous additional Zona investors, the majority of w...
	16. During the Relevant Period, Sealy knew or should have known that Miller and Larson were acting outside of their employment at Arete and were therefore violating the securities laws and FINRA rules by selling these securities.
	17. Sterritt misappropriated nearly all of the investor funds raised, using them for his unrelated businesses, to wire money to friends and family, to withdraw cash for himself, and on various luxury purchases and personal expenses.
	18. Section 3(a)(4) of the Exchange Act defines a “broker” as any person engaged in the business of effecting transactions in securities for the accounts of others.
	19. Absent an applicable exception or exemption, Section 15(a)(1) of the Exchange Act generally prohibits a broker or dealer from making use of the mails or any means or instrumentality of interstate commerce to effect any transactions in, or to induc...
	20. At no time during the Relevant Period was Sealy registered with the Commission as a broker or dealer or as a person associated with a registered broker or dealer.
	21. As a result of the conduct described above, Respondent willfully  violated, and willfully aided and abetted and caused Miller and Larson’s violations of, Section 15(a) of the Exchange Act.