2015-04-14 SEC Press press_release 62 KB 2,292 chars

SEC Halts Investment Scheme Targeting Military Personnel

Release
2015-66
Caption
Securities and Exchange Commission v. Leroy Brown Jr., et al.
Source PDF JSON
summary

Leroy Brown Jr. defrauded U.S. military personnel and other investors by falsely claiming to be a licensed, experienced stockbroker and Army veteran, promising guaranteed 2x-3x returns in 120 days through his unregistered firm LB Stocks and Trades Advice LLC, leading to an SEC asset freeze and charges for securities fraud and unregistered offerings.

paragraph

The SEC charged Leroy Brown Jr. and his firm, LB Stocks and Trades Advice LLC, with securities fraud and operating an unregistered securities offering, alleging Brown falsely claimed to be a licensed, experienced stockbroker and Army veteran to gain trust. He promised investors—many stationed at Fort Hood—that their money would double or triple within 120 days, despite having no regulatory registrations with the SEC, FINRA, or any state agency and no investment experience. The court has frozen all of Brown’s assets, and the SEC is seeking disgorgement of ill-gotten gains, financial penalties, and permanent injunctive relief.

narrative

Leroy Brown Jr. and his firm, LB Stocks and Trades Advice LLC, have been charged by the SEC with securities fraud and operating an unregistered securities offering after allegedly deceiving U.S. military personnel and other investors. Brown falsely presented himself as a licensed, experienced stockbroker and Army veteran, exploiting the trust associated with military service to solicit investments, particularly from service members near Fort Hood. He guaranteed investors they would double or triple their money within 120 days, despite having no regulatory registrations with the SEC, FINRA, or any state authority and no verifiable history in securities trading. The SEC’s investigation revealed that Brown’s firm had no legitimate investment operations or credentials, and he used these false assurances to raise undisclosed sums from victims. In response, a federal court has issued a temporary asset freeze on Brown and his firm to prevent further dissipation of funds. The SEC is seeking disgorgement of all ill-gotten gains, financial penalties, and a permanent injunction barring Brown from future securities activities. The case, filed in the Western District of Texas, was investigated by the SEC’s Fort Worth Regional Office with critical support from the U.S. Secret Service, Texas DPS Criminal Investigations Division, and the U.S. Attorney’s Office.

Enriched metadata

Scheme
affinity-fraud (90%)
Court
Western District of Texas
Classified affinity-fraud(confidence 90%). EDGAR detection: forms Form D· recall 58% / precision 2%. detection rule →
Parties
Securities and Exchange CommissionLeroy Brown Jr.LB Stocks and Trades Advice LLC
Keywords
secbrownmilitarysecuritiesmilitary personnelstocks tradestrades advicetexasexperiencehalts investmentinvestment schemescheme targetingtargeting militarybrown falselyfort worth

Exhibits & Attached Documents (1)

Extracted insights

Entities 14
  • person b. david fraser
  • person david woodcock
  • person Jim Etri
  • company lb stocks and trades advice llc
  • company leroy brown jr. and lb stocks and trades advice llc
  • scheme_term leroy brown jr. and lb stocks and trades advice with securities fraud
  • person licensed securities professional
  • agency sec case
  • agency sec complaint
  • agency sec, finra, or any state regulator
  • agency sec fort worth regional office
  • agency sec litigation
  • agency Securities and Exchange Commission
  • court u.s. district court for the western district of texas
Triples 17
  • SEC announced fraud charges against Leroy Brown Jr.
  • SEC issued asset freeze against Leroy Brown Jr. and LB Stocks and Trades Advice LLC
  • Leroy Brown Jr. falsely claimed military connection as Army veteran
  • Leroy Brown Jr. solicited investors through LB Stocks and Trades Advice LLC
  • Leroy Brown Jr. falsely assured investors he had many years of experience in securities markets
  • Leroy Brown Jr. falsely claimed to have all necessary licenses and registrations for securities business
  • Leroy Brown Jr. is not licensed securities professional
  • LB Stocks and Trades Advice LLC is not registered with SEC, FINRA, or any state regulator
  • Leroy Brown Jr. falsely guaranteed investors he would double or triple their money within 120 days
  • SEC filed complaint in U.S. District Court for the Western District of Texas
  • SEC complaint charges Leroy Brown Jr. and LB Stocks and Trades Advice with securities fraud
  • SEC is seeking financial penalties, disgorgement of ill-gotten gains, and permanent injunctive relief
  • Court issued order temporarily freezing all assets of Leroy Brown Jr. and LB Stocks and Trades Advice
  • Chris Ahart and Melvin Warren conducted investigation for SEC Fort Worth Regional Office
  • Jim Etri supervised SEC case
  • B. David Fraser led SEC litigation
  • David Woodcock is Director of SEC Fort Worth Regional Office
PDF (from attached: complaint)
Complaint against Defendants Leroy Brown, Jr. and LB Stocks and Trades Advice LLC · Source
Text layers
Extracted body text (2,292c) 
The Securities and Exchange Commission today announced fraud charges and an asset freeze against a man living in central Texas accused of telling false tales about his stockbroking experience to lure current and former U.S. military personnel into investing with him. The SEC alleges that Leroy Brown Jr. touted his own military connection as an Army veteran while soliciting members of the military and other investors through his firm LB Stocks and Trades Advice LLC. Brown falsely assured investors, including some stationed at nearby Fort Hood, that he had many years of experience in the securities markets. He specifically claimed to have all the necessary licenses and registrations to conduct securities business. In reality, Brown is not a licensed securities professional and his firm is not registered with the SEC, Financial Industry Regulatory Authority, or any state regulator. Brown and his firm have no evident experience with investments. The SEC further alleges that Brown falsely guaranteed investors that he would double or triple their money within 120 days. “Trust is a bedrock principle to our military, and we allege that Brown exploited his own military experience and abused that trust for his own personal gain,” said David Woodcock, Director of the SEC’s Fort Worth Regional Office. “Investment fraud is always wrong, but it’s especially pernicious when perpetrated against those who have sacrificed so much for our freedom.” The SEC’s complaint, filed yesterday in U.S. District Court for the Western District of Texas, charges Brown and LB Stocks and Trades Advice with securities fraud and conducting an unregistered securities offering. The SEC is seeking financial penalties and disgorgement of ill-gotten gains as well as permanent injunctive relief. The court has issued an order temporarily freezing all assets of Brown and LB Stocks and Trades Advice. The SEC’s investigation was conducted by Chris Ahart and Melvin Warren of the Fort Worth Regional Office, and the case was supervised by Jim Etri. The SEC’s litigation is being led by B. David Fraser. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Western District of Texas, the U.S. Secret Service, and the Texas Department of Public Safety - Criminal Investigations Division.
OCR text (2,292c · plain-text · 99% conf) 
The Securities and Exchange Commission today announced fraud charges and an asset freeze against a man living in central Texas accused of telling false tales about his stockbroking experience to lure current and former U.S. military personnel into investing with him. The SEC alleges that Leroy Brown Jr. touted his own military connection as an Army veteran while soliciting members of the military and other investors through his firm LB Stocks and Trades Advice LLC. Brown falsely assured investors, including some stationed at nearby Fort Hood, that he had many years of experience in the securities markets. He specifically claimed to have all the necessary licenses and registrations to conduct securities business. In reality, Brown is not a licensed securities professional and his firm is not registered with the SEC, Financial Industry Regulatory Authority, or any state regulator. Brown and his firm have no evident experience with investments. The SEC further alleges that Brown falsely guaranteed investors that he would double or triple their money within 120 days. “Trust is a bedrock principle to our military, and we allege that Brown exploited his own military experience and abused that trust for his own personal gain,” said David Woodcock, Director of the SEC’s Fort Worth Regional Office. “Investment fraud is always wrong, but it’s especially pernicious when perpetrated against those who have sacrificed so much for our freedom.” The SEC’s complaint, filed yesterday in U.S. District Court for the Western District of Texas, charges Brown and LB Stocks and Trades Advice with securities fraud and conducting an unregistered securities offering. The SEC is seeking financial penalties and disgorgement of ill-gotten gains as well as permanent injunctive relief. The court has issued an order temporarily freezing all assets of Brown and LB Stocks and Trades Advice. The SEC’s investigation was conducted by Chris Ahart and Melvin Warren of the Fort Worth Regional Office, and the case was supervised by Jim Etri. The SEC’s litigation is being led by B. David Fraser. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Western District of Texas, the U.S. Secret Service, and the Texas Department of Public Safety - Criminal Investigations Division.

Related documents (1)