SEC v. RICHARD RANDALL. Jury Trial Demanded

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION

SECURITIES AND EXCHANGE COMMISSION,

Plaintiff,
 C.A. No.: 3:21-cv-979
v.

RICHARD RANDALL. Jury Trial Demanded

Defendant.

COMPLAINT
Plaintiff Securities and Exchange Commission (“SEC”) files this Complaint against
Defendant Richard Randall (“Randall”) and alleges as follows:
SUMMARY OF THE ACTION
1. Randall and his recently deceased associate engaged in a fraudulent scheme to
lure investors with an opportunity to purportedly invest in a revo lut ionary wireless technology
for transmitting electricit y, but then diverted most of the investor funds to themselves using shell
companies they controlled that were not affiliated with the company developing the technology.
The scheme centered on a securities offering of units in Wireless Power, LLC (“Wireless
Power”).  Between approximately March 2015 and July 2016 (“Relevant Period”), the offering
raised approximately $17.2 million from approximately 52 investors in multiple states and
countries.
2. The offering memorandum stated that Wireless Power would use investor funds
to purchase equity interests in three purportedly affiliated companies – one that owned and was
developing the technology, one that would market the technology, and one that would act as a

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power broker to purchase electricity for resale using the technology.  In reality, almost
immediately upon receipt, Wireless Power transferred substantially all of the investor funds to
the bank accounts of two undisclosed companies that Randall controlled, and Randall misused
and misappropriated most of the funds for his benefit, to pay his associate, to pay undisclo sed
sales commissions, and for other purposes not authorized by the offering memorandum.
3. Randall’s primary role in the scheme was this unauthorized movement of investor
funds, but he also engaged in other deceptive acts.  Randall held out the purported marketing
company he controlled as a legitimate and valuable investment target in connection with the
offering, when in fact it was a worthless shell company.  He also disguised   the transfer of
investor funds for his benefit through fictitious or, at a minimum, deceptive purported sales of
the marketing company’s shares to Wireless Power, including by executing false documentation.
In addition, Randall provided substantial assistance to Wireless Power in its making   of
misstatements and omissions in the offering memorandum and elsewhere about the use of
investor funds and Randall’s purported marketing company as detailed below.
4. By reason of this misconduct, Randall violated Sections 17(a)(1) and 17(a)(3) of
the Securities Act of 1933 (the “Securities Act”) [15 U.S.C. §§ 77q(a)(1) and 77q(a)(3)  ] and
Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) [15 U.S.C. § 78j(b)]
and Rules 10b-5(a) and 10b-5(c) thereunder [17 C.F.R. §§ 240.10b-5(a) and 240.10b-5(c)], and
he aided and abetted Wireless Power’s violations of Section 17(a) of the Securities Act [15
U.S.C. § 77q] and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5
thereunder [17 C.F.R. § 240.10b-5].  The SEC brings this action seeking permanent injunctive

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relief, disgorgement of ill-gotten gains plus prejudgment interest, civil penalties, and all other
equitable and ancillary relief the Court deems necessary
.
JURISDICTION AND VENUE
5. This Court has jurisdiction over this action pursuant to Sections 20(b), 20(d), and
22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)] and Sections 21(d), 21(e),
and 27 of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa].  Randall, directly or
indirectly, made use of the means or instruments of transportation or communication, or the
instrumentalities of interstate commerce or the mails, in connection with the transactions, acts,
practices, and courses of business alleged herein.
6. Venue is proper in this district pursuant to Section 22(a) of the Securities Act [15
U.S.C. § 77v(a)] and Section 27 of the Exchange Act [15 U.S.C. § 78aa].  Certain of the
transactions, acts, practices, and courses of business constituting vio lat ions of the federal
securit ies laws occurred within this district.  Among other things, securities were offered and
sold in this district, movement of investor funds occurred in this district, Randall transacts
business within this district, and the principal places of business of Wireless Power, the Randall
Companies, and some or all of the Target Companies, as defined below, are in this district.
DEFENDANT
7. Randall is an individual who resides in Collin County, Texas.  Randall was
previously convicted of a felony in this district for violating 18 U.S.C. § 1014 for making a false,
material statement for the purpose of influencing action on a loan by an institution, the deposits
of which were insured by the FDIC.  Randall refused to appear for testimony during the SEC’s
investigation of this matter.

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FACTUAL ALLEGATIONS

A. Relevant Entities.
8. Wireless Power was formed as a Texas limited liability company on or about
October 31, 2014, with its principal place of business in Dallas, Texas.  During the Relevant
Period, a Dallas-based attorney served as Wireless Power’s registered agent and sole manager
(“WP Manager”).  However, as alleged further below, Randall’s recently deceased associate
(“Promoter”) controlled Wireless Power and directed the WP Manager’s  activities related to
Wireless Power and the offering.
9. The “Technology Company” is identified by name in the offering materials and
was formed as a Texas limited liability company on or about August 29, 2013, with its principal
place of business in Red Oak, Texas.  Neither Randall nor the Promoter has ever been an officer,
director, manager, or employee of the Technology Company, which at all times has been
managed and controlled by unaffiliated third parties.
10. The “Power Broker” is identified by name in the offering materials as Texanova
Energy, Inc.  Upon information and belief, this entity has never existed.  A company wit h a
similar name was formed as a Texas limited liability company on or about June 24, 2015, with
its principal place of business in Dallas, Texas, and is, upon information and belief, the successor
to a failed water hauling venture that the Promoter controlled.  During the Relevant Period, the
Promoter controlled the Power Broker and was a signatory on its bank account.  During the
Relevant Period, the Power Broker was a shell company with no or nominal operations or
revenues and no or nominal assets, excluding Wireless Power investor funds that flowed through
the company’s bank account.

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11. The “Marketing Company” is identified by name in the offering materials as
“Tesla Power Company, LLC.”  Tesla Power Company, LLC was formed as a Texas limited
liability company on or about April 14, 2014, was also formed as a Delaware limited liability
company on or about July 8, 2015, and uses a Rowlett, Texas address as its principal place of
business.  During the Relevant Period, Randall controlled the Marketing Company, which, upon
information and belief, did not have a bank account.  During the Relevant Period, the Marketing
Company was a shell company with no or nominal operations or revenues, and no or nominal
assets, arguably excluding its independent agency agreement with the Technology Company
discussed below.
12. The Technology Company, the Power Broker, and the Marketing Company are
referred to collectively as the “Target Companies.”
13. The “Randall Companies” are Holmes Financial Services, LLC and Holmes
Trading Company, LLC.  The Randall Companies are not disclosed in the offering materials.
The Randall Companies were formed as Texas limited liability companies on or about
September 11, 2006 and September 10, 2009, respectively, with their principal places of business
in Rowlett, Texas.  During the Relevant Period, Randall controlled the Randall Companies and
was the sole signatory on their bank accounts.
B. The Wireless Power Offering.
1.  Background
14. Randall had a pre-existing connection to persons associated with the Technology
Company.  In 2014, Randall introduced the Promoter to the Technology Company and to the
wireless technology for transmitting electricity it was developing (“Wireless Technology”).

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Upon information and belief, the Promoter and Randall then together devised what became the
Wireless Power offering.  The Promoter and Randall repeatedly referred to each other as
“partners” in connection with the venture, even though their names never appeared in the
Wireless Power offering materials.
15. The Promoter approached the WP Manager and told him that he intended to
create a company to raise funds to invest in the Target Companies.  On or about October 31,
2014, the WP Manager formed Wireless Power at    the Promoter’s request.
16. The WP Manager has described his role at Wireless Power during the Relevant
Period as essentially administrative, including maintenance of the books, records, and bank
accounts.  At all times during the Relevant Period, the WP Manager took direction from and
reported to the Promoter, who was Wireless Power’s agent and the person in de facto control of
Wireless Power.
2.  The offering memorandum.
17. In early 2015, a written offering memorandum (“Offering Memo”) was prepared
to offer for sale to investors units of interest in Wireless Power.  The Promoter took the lead role
in  drafting the Offering Memo, and he controlled and had ultimate authority over the statements
in the Offering Memo, including its contents and whether and how to communicate them.
18. Randall was also involved in the development of the Offering Memo.  At least as
early as January 9, 2015, the Promoter sent the Offering Memo to Randall by email.  And the
Promoter provided the Offering Memo to Randall for his review and comment on multiple
occasions before it was used to raise investor funds in the general solicitation described below.

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19. The Offering Memo states that Wireless Power was seeking to raise a total of $79
million, through the sale of 79 units of Wireless Power (each unit represented 1% of the total
authorized units of interest in the company).  The Offering Memo instructs investors to rely on
the information contained in the Offering Memo.
20. The Offering Memo claims that Wireless Power has the opportunity to invest in
unique and proprietary wireless technology, and that investors would see “significant revenue
streams” and would “mak[e] a tremendous impact on impoverished and developing nations and
foster[] a global economic boom.”  The Offering Memo tells investors that “[w]e anticipate that
our first year revenues will consist primarily of license fees in the amount of $1 billion” with
annual royalties between 10% and 20% of gross revenue.
21. The Offering Memo represents that Wireless Power would use investor funds to
purchase equity interests in the Target Companies, which it represents are “3 affiliated
companies that have been organized to capitalize on the discoveries [related to the Wireless
Technology].”  Specifically, the Offering Memo represents that Wireless Power would use the
investor funds to purchase a:
• 4% equity interest in the Technology Company that possessed the
exclusive global rights to the technology;
• 16% equity interest in the Marketing Company, described as the “sole
licensed Master Distributor for [the Technology Company,]” that
would provide “outside licensing, marketing and sales of the
technology globally;” and

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• 24% equity interest in the Power Broker “formed for the purpose of
acquiring and aggregating electricity from providers around the world
for resale by [the Technology Company].”
3.  The general solicitation.
22. Wireless Power primarily used outside salespeople to market the offering to
investors in multiple states and countries by phone and email in a general so licitat ion.  The
Promoter directed the salespeople, and after contacting prospective investors, the salespeople
often referred the investors to speak or meet with the Promoter directly.  The Promoter also made
several presentations directly to prospective investors to solicit their invest ments.  Randall
participated in several of the investor presentations and investor calls.
23. In connection with these solicitations, investors received the Offering Memo,
typically fro m the salespeople by email or through a link to an electronic drop box that the
Promoter maintained that contained the Offering Memo and other offering materials.  The
Offering Memo was used to solicit investments throughout the Relevant Period, and investor
funds were raised beginning on or about March 2, 2015, and until at least as late as on or about
July 5, 2016.
24. The Offering Memo included subscription documents.  To purchase units,
investors completed the subscription documents and returned them to the WP Manager.  The
subscription documents instruct investors to wire funds to a Wireless Power bank account.
25. The Offering Memo states that the offering of units in Wireless Power is an
offering of securities.  Further, the units are investment contracts, and thus securities, under
Section 2(a)(l) of the Securities Act and Section 3(a)(10) of the Exchange Act.  Investors paid

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money for the units.  The investors’ role in the venture was entirely passive, a fact acknowledged
in the Offering Memo.  The investors’ fortunes were dependent upon, and their expectation of
profits derived so lely fro m, the efforts and expertise of the promoters of Wireless Power and the
Target Companies, which efforts were projected to generate substantial income.  Wireless Power
also pooled investor funds to purportedly invest in the Target Companies, which further tied the
investors’ fortunes to the success of the overall venture.
26. Between approximately March 2, 2015 and July 5, 2016, approximately 52
investors in multiple states and foreign countries invested approximately $17.2 million in the
Wireless Power offering.
C. The Scheme to Defraud.
27. The Offering Memo makes clear that the stated purpose of the securities offering
was to raise money to invest in and profit from the Wireless Technology that the Technology
Company was developing.  To accomplish this, Wireless Power would invest funds in the
Technology Company that held the rights to the Wireless Technology and two purportedly
affiliated companies, one that would market the Wireless Technology (Marketing Company) and
another that would purchase electricity for resale using the Wireless Technology (Power Broker).
28. In reality, the offering was a scheme to use optimism about the potential
technological advances of the Technology Company to siphon investor funds to Randall, the
Promoter, and the salespeople.  To accomplish this scheme, the Offering Memo falsely presented
the Wireless Power three-affiliated-company investment opportunity as the only way to invest in
the Technology Company and its Wireless Technology.

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29. The Technology Company was aware that persons associated with Wireless
Power were seeking to raise money to invest in the Technology Company, but the Technology
Company was seeking investments from other sources as well.  The Technology Company was
also not involved in, much less endorsing, Wireless Power’s efforts to raise funds for the
purported Marketing Company and Power Broker.  The Technology Company’s CEO at the time
was shocked to later learn that Wireless Power was raising funds for these other entit ies in
connection with its efforts to raise funds for the Technology Company.
30. After investors sent their funds to Wireless Power, and unbeknownst to the
investors and in direct contravention of the terms of the Offering Memo, Randall and the
Promoter diverted most of the offering proceeds.  Often the same day or within days of investors
wiring their funds into the Wireless Power bank account, the WP Manager, at    the Promoter’s
direct ion, transferred the investor funds to undisclosed bank accounts held by the Randall
Companies and controlled by Randall, a convicted felon.  Randall then further diverted the
investor funds by transferring most of the funds to himself, the Promoter, and other entit ies and
individuals, including the salespeople.  The Offering Memo did not disclose Randall, his
involvement in the offering, or his felony conviction.
31. In furtherance of the scheme, and unbeknownst to investors, Randall also used a
shell company he controlled for the Marketing Company, and the Promoter used a shell company
he controlled for the Power Broker.  Randall and the Promoter then purportedly exchanged
shares of their shell companies for investor funds, which they used for their personal benefit or
other purposes that the Offering Memo did not authorize.  The Promoter also actually or
fict itiously issued shares of the Power Broker to family members and the salespeople, and then

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Wireless Power purportedly purchased these shares using investor funds.  Upon information and
belief, the share transactions were not properly documented, if  they were documented at all.
32. The Offering Memo did not disclose that Randall, the Promoter, or other persons
purportedly held shares of the Marketing Company or the Power Broker, that Wireless Power
would be purchasing shares fro m them or for their benefit, or that Randall, the Promoter, their
families, or the salespeople held any interests in the companies.  To the contrary, the Offering
Memo represents that the Marketing Company and the Power Broker were newly formed
companies affiliated with the Technology Company, and investors were led to believe that their
funds would be invested in the Target Companies themselves and used as working capital to
fund the Target Companies’ operations.  Yet, the Marketing Company received no investor funds
as a result of the offering, and the Power Broker (but not the entity named in Offering Memo,
which, upon information and belief, does not exist) received only approximately $110,000
directly from Wireless Power and $222,000 from one of the Randall Companies.
33. Of the approximately $17.2 million raised from Wireless Power investors,
approximately $3.3 million was later returned or refunded to investors, leaving approximately
$14 million available to invest in the Target Companies.  Bank records indicate, however, that
approximately two-thirds of these funds were misused or misappropriated.
D. Randall Misused and Misappropriated Investor Funds.

34. Randall misused and misappropriated investor funds in direct violation of
Sections 17(a)(1) and 17(a)(3) of the Securities Act and Section 10(b) of the Exchange Act and
Rules 10b-5(a) and 10b-5(c) thereunder.

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  1.  How investor funds could be used.
35. The Offering Memo states that Wireless Power would use the proceeds of the
offering to purchase “equity” interests in the three “affiliated” Target Companies.  The Offering
Memo further represents that the Target Companies are “newly formed organizations [that] have
no significant financial history,” and that the “primary purpose of this offering is to invest in the
[Target Companies] that have been formed to launch” the Wireless Technology.
36. Pursuant to the Offering Memo, “[p]ending application of the net proceeds of this
offering, the Company may invest the net proceeds from this offering in short-term, interest-
bearing securities.”  The Offering Memo represents that “no selling commissions will be paid,”
and discloses that the maximum approximate amount of offering expenses would be $50,000.
37. During an organized investor telephone conference call on or about June 25, 2015
(“Investor Conference Call”), the Promoter described the Wireless Power offering as a first
phase of capitalization.  A transcript of the Investor Conference Call was posted in the drop box
of offering materials, and, upon information and belief, was available to investors through the
end of the Relevant Period.  Randall attended and spoke to investors during the Investor
Conference Call, and he had access to the drop box.
38. The Offering Memo did not authorize or disclose that any investor funds would
be: (a) transferred to the Randall Co mpanies; (b) distributed to Randall, the Promoter, or their
affiliates or family members; (c) paid to salespeople; (d) used to purchase or create a market for
shares in the Power Broker or the Marketing Company held by Randall, the Promoter, the
salespeople, or other persons; or (d) used to make loans.

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2.  How Randall actually used investor funds.
39. Randall used the Randall Companies’ accounts as a device to misuse and
misappropriate investor funds.  Randall provided the account information and authorizations
necessary for Wireless Power to transfer investor funds to the Randall Companies’ accounts.
After Wireless Power improperly transferred investor funds to the Randall Companies’ accounts,
Randall, as signatory on those accounts, caused the investor funds to be further diverted to
himself, the Promoter, the salespeople, and for other improper purposes through a series of wires
and other bank transactions.
40. Wireless Power, at the Promoter’s direction, disbursed approximately $16.6
million of the $17.2 million raised from the Wireless Power investors from Wireless Power’s
bank account to the Randall Companies’ bank accounts.  The transfers occurred repeatedly
throughout the Relevant Period, beginning on about May 15, 2015, and continuing as late as
approximately July 11, 2016.  The Offering Memo did not authorize or disclose the transfers of
investor funds to the Randall Companies, which themselves were not disclosed in the Offering
Memo and were controlled by Randall.
41. The investor funds were commingled with other funds in the Randall Companies’
accounts, and Randall then caused the Randall Companies to disburse all of the funds in those
accounts, including all of the $16.6 million of investor funds, from the accounts, including by:
a. Randall causing the Randall Companies to disburse approximately $5.3
million of the investor funds from the Randall Companies’ accounts to his personal accounts and
to investment accounts that he controlled and used for his benefit.  These transfers occurred
repeatedly throughout the Relevant Period, beginning on or about May 15, 2015, and continuing

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as late as approximately November 9, 2017.  Not only were these transfers not authorized or
disclosed, the Offering Memo did not even ident ify Randall.
b. Randall causing the Randall Companies to disburse approximately $2.2
million of the investor funds from the Randall Companies’ accounts to personal and business
accounts of the Promoter.  These transfers occurred repeatedly throughout the Relevant Period,
beginning on or about May 22, 2015, and continuing as late as approximately June 9, 2016.
Again, these transfers were not authorized or disclosed in the Offering Memo.
c. Randall causing the Randall Companies to disburse approximately $1.6
million of the investor funds to pay sales commissions to the salespeople for their work soliciting
investors.  These payments occurred repeatedly throughout the Relevant Period, beginning on or
about June 5, 2015, and continuing as late as approximately October 14, 2016.  The Offering
Memo did not authorize or disclose the payments to the salespeople, and in fact expressly stated
that no selling commissions would be paid in connection with the offering and capped offering
expenses at approximately $50,000.
d. Randall also caused the Randall Companies to disburse investor funds to
fund loans, including disbursing approximately $480,000 between approximately February 5,
2016 and August 17, 2016, to fund loans to an undisclosed third-party company, with interest
and principal payable to one of the Randall Companies (and not to Wireless Power or its
investors).  The Offering Memo did not authorize or disclose the use of investor funds for loans,
much less loans payable to one of the Randall Companies.
42. Each of these transfers of investor funds that Randall accepted into the Randall
Companies’ accounts and each of these transfers of investor funds that he caused to be made out

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of those accounts was a deceptive act that Randall committed in furtherance of the scheme.  The
transfers occurred while the offering was ongoing, and often the same day or within days of
investors wiring their funds into the Wireless Power bank account.  The transfers enabled
Randall and the Promoter to accomplish the purpose of the scheme, which was to cash out the
investor funds for their benefit.
43. The bank records do not show any funds distributed from the Randall Companies’
accounts to the Marketing Company, and show only approximately $220,000 distributed from
the Randall Companies’ accounts to the Power Broker (but not to the Power-Broker entity
identified in the Offering Memo, which, upon information and belief, does not exist).
44. Randall did distribute approximately $4.7 million to the Technology Company
fro m the Randal Co mpanies’ accounts.  In June 2015, and while Wireless Power was still raising
investor funds pursuant to the Offering Memo, Randall, through one of the Randall Companies,
entered into an agreement with the Technology Company granting that Randall Co mpany the
right to purchase up to two million units of the Technology Company directly.  The Randall
Company used the $4.7 million to purchase units in the Technology Company pursuant to this
option agreement, which the Offering Memo did not disclose.  Upon information and belief,
some or all of these units were ultimately transferred to Wireless Power.
45. To date, the SEC’s staff has been unable to perform a complete segregation of the
distribut ions from the Randall Companies’ accounts as a result of the extensive commingling of
investor funds in the Randall Companies’ accounts, Randall’s failure to maintain and produce
adequate books and records, and Randall’s refusal to appear and explain the transactions.

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46. Randall’s misuse and misappropriation of investor funds was material.  A
reasonable investor would consider the facts that the offering proceeds would not be used as
represented and would instead be diverted to undisclosed accounts controlled by a convicted
felo n, comingled with other funds, and disbursed for the personal benefit of undisclosed
individuals and salespeople promoting the offering to be important in deciding whether to invest
in the offering.
E. Randall Used The Marketing Company Deceptively.
47. Randall engaged in additional deceptive acts relating to the Marketing Company
in direct violation of Sections 17(a)(1) and 17(a)(3) of the Securities Act and Section 10(b) of the
Exchange Act and Rules 10b-5(a) and 10b-5(c) thereunder.
1. Randall helped create a false appearance.
48. Randall was able to obtain investor funds fro m the scheme because he helped
Wireless Power create a false appearance of fact about the Marketing Company that was used to
convince Wireless Power investors to invest funds to purchase the Marketing Company’s equit y
interests.
49. Wireless Power falsely presented the Marketing Company as a legitimate and
lucrative business.  As alleged in more detail at Section F.2 below:
• The Offering Memo represents that the Marketing Company is affiliated with the
Technology Company.  It was not.
• The Offering Memo represents that the Marketing Company has a Master
Distribut ion agreement with the Technology Company.  It did not.

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• The Offering Memo states the Marketing Company will provide outside licensing,
marketing and sales of the technology globally.  It was a shell company and could
not.
• The Offering Memo represents that a public offering of shares in the Marketing
Company would be the only vehicle available to the public for investment in the
Wireless Technology.  This representation was false and misleading.
• The Offering Memo projects the Marketing Company would earn approximately
$163 million, $1.8 billion, and $3.5 billion in revenues during 2015, 2016, and 2017,
respectively.  The Marketing Company had no revenue or ability to generate revenue.
50. Randall participated   in creating this false appearance of fact.  The Promoter
provided the Offering Memo to Randall on multiple occasions for his review and comment,
including by email on January 9, 2015, and, upon information and belief, the Promoter and
Randall also orally discussed the terms of the Offering Memo before it was used in the general
solicitation to obtain investor funds.  Thus, Randall knowingly authorized and allowed Wireless
Power to use the Marketing Company he controlled as one of the Target Companies in the
Offering Memo, even though it was a shell company, which, upon information and belief, did
not even have a bank account, and he likewise authorized and allowed Wireless Power to, as
alleged above and at Section F.2 below, falsely present the Marketing Company and its
agreement with the Technology Company in the Offering Memo.
51. Randall also participated in investor calls and investor presentations as a
representative of the Marketing Company to perpetuate the false appearance of fact.  During the
Investor Conference Call, for example, the Promoter introduced Randall as one of the principals

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of the Marketing Company, which he described as the marketing ent it y for all of the Wireless
Technology, and stated a future public offering of the Marketing Company’s shares would be the
only vehicle to invest in a part of the Wireless Technology after the Wireless Power offering.
Randall then spoke to the investors, but did nothing to correct this false impression of the
Marketing Company, much less disclose that it was, in realit y, his shell co mpany.
52. As another example, in approximately early June 2015, Randall, the Promoter,
and several salespeople participated in a telephone conference call with an investor in Florida.
The investor was told that the Marketing Company had an exclusive marketing agreement with
the Technology Company, and that the Wireless Power offering was the only way to invest in the
Technology Company, neither of which was true.  That latter point was reiterated to the investor
in a subsequent telephone conference call on or about June 25, 2015, in which Randall also
participated.  Randall affirmatively made one or more of these misstatements to the investor, or,
at a minimum, he helped create the false impression being advanced by participating on the call
as a representative of the Marketing Company and doing nothing to correct it.
2.   Randall engaged in deceptive share transactions.
53. The Offering Memo stated that Wireless Power would use a percentage of the
investor funds to purchase equity interests in the Marketing Company.  To further the scheme,
Randall disguised   his misuse and misappropriation of investor funds as Wireless Power
purchases of interests in the Marketing Company.  These purported purchases, however, were
fictitious or, at a minimum, deceptive, because investors funds were not used to capitalize the
Marketing Company, and were instead diverted for Randall’s benefit.  The principal purpose and
effect of the sham sales was to further the scheme by enabling Randall to use his shell

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company’s worthless shares to obtain investor funds while furthering the false narrative that
investors were providing capital to launch an actual marketing company.
54. To illustrate, in June 2015, an investor asked the Promoter for confirmation that
Wireless Power possessed the rights to acquire interests in the Marketing Company.  In response,
on June 17, 2015, the Promoter sent Randall an email asking him to draft and sign a letter on the
Marketing Company’s letterhead granting options from the Marketing Company to Wireless
Power.  Randall then executed the requested letter on behalf of the Marketing Company, which
was addressed to Wireless Power, and provided it to the Promoter by email on June 19, 2015.
The letter states that the Marketing Company owns or controls and has granted Wireless Power
the option to purchase 16,000,000 shares of the Marketing Company’s common stock at a price
of $1.92 per share.  But to the extent Wireless Power purchased any shares (or units) of the
Marketing Compa  ny, unbeknownst to investors, it purchased them from Randall or other
purported Marketing Company shareholders.  In short, Randall, through this deceptive letter,
created the false impression that the Marketing Company was selling company shares to raise
capital, when he knew this was not true.
55. Upon information and belief, there was no valid sale or transfer of the Marketing
Company’s shares or units to Wireless Power at or around the time of the transfers of investor
funds, and Randall has produced no documentation to support any such transactions in response
to the SEC’s document subpoena during its investigation that preceded the filing of this lawsuit.
F. Randall Aided and Abetted Wireless Power.
56. In connection with the offer, sale, and purchase of the Wireless Power units,
Wireless Power made material misrepresentations and omissions to investors and engaged in
other fraudulent conduct in furtherance of the scheme in direct vio lat ion of Section 17(a) of the

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Securities Act and Section 10(b) of the Exchange Act and Rules 10b-5(a) thereunder.  Randall
aided and abetted the violations by providing substantial assistance to Wireless Power.
1. Misstatements and omissions about the use of funds.
57. As alleged above, the Offering Memo states that: (a) Wireless Power would use
the proceeds of the offering to purchase equit y interests in the three Target Companies; (b) the
Target Companies are newly formed organizations; (c) the primary purpose of the offering is to
invest in the Target Companies that have been formed to launch the Wireless Technology; (d)
pending application of the net proceeds of the offering, Wireless Power may invest the net
proceeds in short-term, interest-bearing securit ies; (e) no selling commissions will be paid; and
(f) the maximum approximate amount of offering expenses will be $50,000.  I  n the Investor
Conference Call, the Promoter represented the offering was a first phase of capitalization.
58. These statements about the use of investor funds are false and misleading.
Wireless Power did not use the investor funds as promised.  Instead, the Promoter and Randall
diverted most of the investor funds to themselves, to the salespeople as sales commissions, to
make loans, and for other purposes not authorized by the Offering Memo as alleged above.
59. Having chosen to make statements to investors in the Offering Memo about how
investor funds would be used, Wireless Power also failed to state facts necessary in order to
make the statements, in light of the circumstances under which they were made, not misleading.
Wireless Power failed to disclose that investor funds would be: (a) transferred to the Randall
Companies; (b) distributed to the Promoter, Randall, or their affiliates or family members; (c)
paid to salespeople; (d) used to purchase or create a market for the shares of the Power Broker

21

and the Marketing Company held by Randall, the Promoter, the salespeople, or others persons;
and (e) used to make loans.
60. The Offering Memo states that the Target Companies were newly formed, had no
substantial financial history, and had been formed to launch the Wireless Technology.  But the
Offering Memo did not disclose that the Promoter, Randall, and the salespeople purportedly held
interests in the Power Broker and/or Marketing Company, and that investor funds would be used
to purchase shares from individuals and not disbursed directly to the Power Broker and
Marketing Company.  This was misleading as it led investors to believe their funds would be
used to help launch and capitalize the Power Broker and Marketing Company, when in fact, the
funds were going to the Promoter, Randall, and the salespeople.
61. The misstatements and omissions relating to the use of investor funds are
material.  A reasonable investor would consider the facts that the offering proceeds would not be
used as represented and would instead be diverted to undisclosed accounts controlled by a
convicted felon and disbursed for the personal benefit of undisclosed individuals and salespeople
promoting the offering to be important in deciding whether to invest in the offering.
2.  Misstatements and omissions about the Marketing Company.
62. The Offering Memo represents that the Technology Company is affiliated with
the Marketing Company and the Power Broker, and an offering summary document describes the
offering as an investment in “three affiliated companies who have joined.”
63. These statements are false and misleading, because the Technology Company was
not affiliated with the Marketing Company or the Power Broker, which were controlled by
Randall and the Promoter, respectively.

22

64. The Offering Memo identifies the projected public offering of shares in the
Marketing Company “as the only vehicle available to the public for investment in this new
technology” and the offering summary represents that the offering is the “exclusive opportunity
to invest in the unique and proprietary ability to deliver disruptive and innovative energy and
data technologies on a global scale...”  During the Investor Conference Call, the Promoter stated
that a future public offering of the Marketing Company would be the only vehicle to invest in a
part of the Wireless Technology after the Wireless Power offering.

65. These statements are false and misleading.  Wireless Power was not the only
opportunity for investors to invest in the Technology Company or its Wireless Technology.
During the Relevant Period, the Technology Company was accepting direct invest ments
unrelated to the Wireless Power offering and unconnected to any purported future public offering
of the Marketing Company.
66. The Offering Memo represents that the Marketing Company “has a Master
Distribut ion Agreement” with the Technology Company making the Marketing Company “the
sole Master Distributor” of the Wireless Technology, and states the Marketing Company “will
provide outside licensing, marketing and sales of the technology globally.”  Investors were also
told orally that the Marketing Company had an exclusive marketing agreement with the
Technology Company, including during the call with the Florida investor in approximately early
June 2015.
67. These statements are false and misleading.  The Marketing Company did not have
a Master Distribution Agreement with the Technology Company, and it was not the sole licensed
Master Distributor for the Technology.  The Marketing Company had an Independent Agency

23

Agreement with the Technology Company that did not make it a Master Distributor, which
expressly stated that the Marketing Company only had rights to market the Wireless Technology
on a non-exclusive basis, and confirmed that the parties were independent of each other.  The
Offering Memo further misleads investors by omitting that that Marketing Company was a shell
company in no position to provide outside licensing, marketing and sales of the technology
globally.
68. The Offering Memo represents that the WP Manager would represent Wireless
Power’s interests as a member of the board of directors of the Marketing Company and the
Power Broker.  This was false and misleading.  The WP Manager was never a member of or
asked to serve on the board of directors for the Marketing Company or the Power Broker.  Upon
information and belief, neither the Marketing Company nor the Power Broker even had a board
of directors.
69. The Offering Memo includes income projections showing the Marketing
Company earning approximately $163 million, $1.8 billion, and $3.5 billion in revenues during
2015, 2016, and 2017, respectively.  The projections include line item detail showing millions of
dollars of operational costs, including salaries, labor, and office costs, for the Marketing
Company in each year.
70. These projections were false and misleading.  The Offering Memo omits material
and critical facts, including that: (a) the Marketing Company was a shell company with no
reasonable ability to fulfill the projected multi-billion dollar business plan; (b) the Marketing
Company had only a non-exclusive agreement with the Technology Company; and (c) the Target
Companies were not actually working together as affiliates to accomplish the purported business

24

plan giving rise to the projections.  The Offering Memo was also used to solicit investors during
2016, and by that time the statements about the prior time periods imbedded factual
misstatements, or at a minimum, were misleading by omission, because substantially none of the
stated revenues were achieved or costs incurred.
71. The misstatements and omissions about the Marketing Company were material.
The Offering Memo contemplated that Wireless Power would use a minimum of approximately
46.7%, and a maximum of approximately 49.1%,
 of investor funds to purchase equity interests in
the Marketing Company, whose business model was based entirely on monetizing the
technology rights that the Technology Company owns.  A reasonable investor would therefore
consider the facts that the Marketing Company was not actually affiliated with the Technology
Company and did not have a master distributor or exclusive arrangement with the Technology
Company important in deciding whether to invest.
72. In evaluating the Marketing Company’s ability to successfully market the
Wireless Technology, a reasonable investor would also consider the facts that the Marketing
Company was a shell company and that the WP Manager, who was described in the Offering
Memo as an AV-rated attorney, would not in fact be protecting investor interests on its board, to
be important in deciding whether to invest.  A reasonable investor would likewise consider the
fact that it could invest directly in the Technology Company that held the Wireless Technology
without diluting their investment dollars to fund Randall’s company important in deciding
whether to invest
3.  Randall provided substantial assistance.
73. Randall provided substantial assistance to Wireless Power in the making of the

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misrepresentations and omissions to investors about the use of their funds and in accomplishing
the scheme to misuse those funds by using his Randall Companies’ accounts to accept and
distribute investor funds from those accounts for the improper purposes alleged above.  Randall’s
actions were critical to Wireless Power’s ability to divert the investor funds and to conceal the
diversion of investor funds from investors.
74. Randall also provided substantial assistance to Wireless Power in  the making of
the misstatements and omissions about the Marketing Company and in creating a false
appearance of fact about the Marketing Company in furtherance of the scheme.  Randall
authorized and allowed Wireless Power to deceptively use and reference the Marketing
Company and its non-exclusive independent agency agreement in the Offering Memo and in
other solicitations to investors.  As alleged above, Randall also participated in investor calls as a
representative of the Marketing Company that portrayed the Marketing Company in a false light.
Randall also executed and caused the Marketing Company to provide the false and misleading
letter indicating that the Marketing Company was selling company shares to Wireless Power.
G. Randall Acted With Scienter.
75. Randall had motive and opportunity to commit the fraud.  Randall was able to
obtain millions of dollars in investor funds for himself as a result of his deceptive acts, including
by taking investor funds purportedly in exchange for shares of his shell company that he would
not have been able to liquidate for any meaningful value in the absence of the scheme.  Randall
sent approximately $5.3 million of investor funds to his personal accounts and to investment
accounts that he controlled and used for his benefit.

26

76. Randall also engaged in the alleged misconduct knowingly or, at a minimum, wit h
severe recklessness.  Randall was involved in the development of the Offering Memo and
received it early in the Relevant Period.  He therefore knew that the Offering Memo did not
authorize Wireless Power to transfer investor funds to his undisclosed companies, or at a
minimum was severely reckless in ignoring the Offering Memo’s terms.  For the same reason,
Randall knew that the distributions he was making from the Randall Companies’ accounts to pay
commissions, to fund loans, and to pay himself and the Promoter, among others, were improper,
or he was severely reckless in making them in violation of the terms of the Offering Memo.
77. Randall also knew that he was receiving Wireless Power investor funds.  The
Promoter and WP Manager kept Randall apprised of the flow of investor funds from Wireless
Power to the Randall Companies, and Randall received multiple emails from the Promoter and
the WP Manager advising him that investor funds were coming into Wireless Power and, upon
receipt, would be wired to the Randall Companies’ accounts, including a series of emails on or
about August 5, 2015 and August 6, 2015.
78. Randall further knew where he was transferring the investor funds, because the
transfers are evident on the face of the Randall Companies’ bank records, and much of the funds
were going to him and the Promoter.  He also knew he was paying commissions, because as
early as January 23, 2015, the Promoter provided Randall a distribution schedule showing a
breakdown of commission payments.  He also knew he was funding loans, because the loans
were payable to one of the Randall Companies, and he received communications relating to the
loans.

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79. Randall also knew that Wireless Power continued to raise funds from new
investors after the misuse of earlier investor funds, and that these new investor funds would be
misused as well.  Because the investor funds were moving in and out of the Randall Companies’
accounts during the offering, the Promoter was keeping Randall apprised of the efforts to raise
funds in the offering, and Randall was participating in investor calls.
80. Randall further knew about, or was severely reckless in ignoring, the false
statements that were being made about the Marketing Company in the Offering Memo and
during the investor calls.  He controlled the Marketing Company, and therefore knew it   was a
shell company and was not affiliated with the Technology Company.  He similarly knew that the
WP Manager was not a director of the Marketing Company.
81. Randall also signed the non-exclusive, independent agency agreement on behalf
of the Marketing Company, and he therefore knew that it was not an exclusive or master
distribut ion agreement.  Randall also knew that Wireless Power was not the exclusive
opportunity to invest in the Technology Company, because he knew one of the Randall
Companies obtained an option to purchase shares in the Technology Company after the offering
commenced, and, upon information and belief, Randall also knew that that the Technology
Company was pursuing direct investments from one or more other investor groups.
82. Randall knew that he caused his controlled company to issue a false and
misleading letter indicating that the Marketing Company would be selling its shares to Wireless
Power.
H. Wireless Power Acted with Scienter.
83. The state of mind of Wireless Power’s agents, including the Promoter, are

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imputed to Wireless Power.
84. The Promoter had motive and opportunity to commit the fraud.  The Promoter
was, like Randall, able to obtain millions of dollars in investor funds for himself and his family
members, including by cashing out worthless shares of a shell company that he would not have
been able to liquidate for any meaningful value in the absence of the scheme.
85. The Promoter engaged in the alleged misconduct knowingly.  The Promoter
prepared the Offering Memo and was familiar with its contents.  The Promoter therefore knew
that investor funds were being used in a manner that the Offering Memo did not authorize,
including that Wireless Power was transferring investor funds to the undisclosed Randall
Companies at his direct ion, that the funds were used for a loan to the Technology Company he
was involved in negotiating, and that investor funds were distributed to him, his family members,
Randall, and the salespeople.  The Promoter knew he was using investor funds to pay
commissions, which he expressly acknowledged in emails that he sent to Randall.  The
Promoter, like Randall, also knew that the Offering Memo continued to be used to raise funds
from new investors after the misuse of earlier investor funds and that these new investor funds
would be misused as well.
86. The Promoter further knew that the purported Power Broker that he controlled
was not affiliated with the Technology Company and that Randall’s purported Marketing
Company was not either, or he was, at a minimum, severely reckless in making such a claim.  He
also knew that the WP Manager was not a director for either of those companies, and in fact he
never asked the WP Manager to be on the boards of eit her of the two shell companies, which,
upon information and belief, had no boards.

29

87. The Promoter also knew that Wireless Power was not the exclusive opportunity to
invest in the Technology Company or, at a minimum, was severely reckless in claiming that it
was, including because: (a) he knew at the time of the offering that Wireless Power did not have
a lock up or any other type of exclusivity agreement with the Technology Company, and (b)
Randall informed him that one of the Randall Companies obtained options to purchase shares in
the Technology Company during the offering.  The Promoter further knew that the Marketing
Company did not have an exclusive or master distribution agreement with the Technology
Company, or at a minimum, was severely reckless in claiming that it did, because the Promoter
had seen no such agreement, and because he had the actual, non-exclusive independent agency
agreement in his possession.
FIRST CLAIM FOR RELIEF
Sections 17(a)(1) and 17(a)(3) of the Securities Act

88. The SEC incorporates by reference each and every allegation contained in
paragraphs 1-  87  above.
89. By engaging in the conduct described herein, Randall, directly or indirectly,
singly or in concert with others, in the offer or sale of securities, by use of the means and
instrumentalities of interstate commerce and/or by use of the mails has: (a) employed devices,
schemes, or artifices to defraud; and/or (b) engaged in transactions, practices, or courses of
business which operate or would operate as a fraud or deceit upon the purchasers.
90. With regard to Randall’s violations of Section 17(a)(1) of the Securities Act,
Randall engaged in the conduct knowingly or with severe recklessness.  With regard to Randall’s
vio lat ions of Sect ion 17(a)(3) of the Securities Act, Randall engaged in the conduct knowingly,
with severe recklessness, or at least negligently.

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91. By reason of the foregoing, Randall violated and, unless enjoined, will continue to
vio late, Sections 17(a)(1) and 17(a)(3) of the Securities Act [15 U.S.C. §§ 77q(1) and 77q(3)].
SECOND CLAIM FOR RELIEF
Section 10(b) of the Exchange Act and Rules 10b-5(a) and 10b-5(c) thereunder

92. The SEC incorporates by reference each and every allegation contained in
paragraphs 1-  87 above.
93. By engaging in the conduct described herein, Randall, directly or indirectly,
singly or in concert, by the use of the means or instrumentalities of interstate commerce and/or
by use of the mails, in connection with the purchase or sale of securities: (a) employed devices,
schemes, or artifices to defraud; and/or (b) engaged in acts, practices, or courses of business
which operate or would operate as a fraud or deceit upon purchasers, prospective purchasers, and
any other persons.
94. Randall engaged in this conduct knowingly or with severe recklessness.
95. By reason of the foregoing, Randall violated and, unless enjoined, will continue to
violate Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rules 10b-5(a) and 10b-5(c)
thereunder [17 C.F.R. §§ 240.10b-5(a) and 240.10b-5(c)].
THIRD CLAIM FOR RELIEF
Aiding and Abetting Violations of Section 17(a) of the Securities Act
and Section 10(b) of the Exchange Act and Rule 10b-5(b) Thereunder

96. The SEC incorporates by reference each and every allegation contained in
paragraphs 1-  87  above.
97. By engaging in the conduct described herein, Wireless Power, directly or
indirectly, singly or in concert with others, in the offer or sale of securities, by use of the means

31

and instrumentalities of interstate commerce and/or by use of the mails has: (a) emplo yed
devices, schemes, or artifices to defraud; and/or (b) obtained money or property by means of
untrue statements of a material fact and/or omitted to state a material fact necessary in order to
make the statements made, in light of the circumstances under which they were made, not
misleading; and/or (c) engaged in transactions, practices, or courses of business which operate or
would operate as a fraud or deceit upon the purchasers.
98. By engaging in the conduct described herein, Wireless Power, directly or
indirectly, singly or in concert, by the use of the means or instrumentalities of interstate
commerce and/or by use of the mails, in connection with the purchase or sale of securities: (a)
employed devices, schemes, or artifices to defraud; and/or (b) made untrue statements of a
material fact and/or omitted to state a material fact necessary in order to make the statements
made, in light of the circumstances under which they were made, not misleading; and/or (c)
engaged in acts, practices, or courses of business which operate or would operate as a fraud or
deceit upon purchasers, prospective purchasers, and any other persons.
99. With regard to Wireless Power’s violations of Section 17(a)(1) of the Securities
Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, Wireless Power engaged
in the conduct knowingly or with severe recklessness.  With regard to Wireless Power’s
vio lat ions of Sect ions 17(a)(2) and 17(a)(3) of the Securities Act, Wireless Power engaged in the
conduct knowingly, with severe recklessness, or at least negligently.
100. By engaging in the conduct described above, Randall knowingly or recklessly
provided substantial assistance to Wireless Power’s vio lat ions of Section 17(a) of the Securities

32

Act [15 U.S.C. § 77q] and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-
5 thereunder [17 C.F.R. § 240.10b-5].
101. By reason of the foregoing, pursuant to Section 15(b) of the Securities Act and
Section 20(e) of the Exchange Act, Randall aided and abetted Wireless Power’s vio lat ions o f,
and unless restrained and enjoined will continue to aid and abet violations of, Section 17(a) of
the Securities Act [15 U.S.C. § 77q(a)] and Section 10(b) of the Exchange Act [15 U.S.C. §
78j(b)] and Rule 10b-5   [17 C.F.R. § 240.10b-5] thereunder.
TOLLING AGREEMENT
102. Randall executed a tolling agreement with the SEC.  The tolling agreement
specifies a period of time beginning on February 1, 2020 through April 30, 2020 (“tolling
period”) during which the running of any statute of limitations applicable to any action or
proceeding arising out of the SEC’s investigation of Randall’s conduct, including any sanctions
or relief that may be imposed therein, is tolled and suspended.  The tolling agreement further
provides that Randall and any of his agents or attorneys “shall not include the tolling period in
the calculation of the running of any statute of limitations or for any other time-related defense
applicable to any proceeding, including any sanctions or relief that may be imposed therein, in
asserting or relying upon any such time-related defenses.”  The tolling agreement tolled the
running of any limitations period or any other time-related defenses applicable to the allegations
in this Complaint during the tolling period.
JURY TRIAL DEMAND
103. The SEC demands a trial by jury on all issues that may be so tried.

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RELIEF REQUESTED
Therefore, the SEC respectfully requests that this Court:
(a) Permanently enjoin Randall from violating, directly or indirectly, Section
17(a) of the Securities Act [15 U.S.C. § 77q] and Section 10(b) of the
Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 C.F.R.
§ 240.10b-5];
(b) Order Randall to disgorge all ill-gotten gains and/or unjust enrichment
realized by him, plus prejudgment interest thereon;
(c) Order Randall to pay a civil penalty pursuant to Section 20(d) of the
Securities Act [15 U.S.C. § 77t(d)] and/or Section 21(d)(3) of the
Exchange Act [15 U.S.C. § 78u(d)(3)]; and
(d) Grant such further relief as this Court may deem just and proper.

Dated: April 30, 2021     Respectfully submitted,

/s/ Keefe M. Bernstein___________
 Keefe M. Bernstein
 Lead Attorney
       Texas Bar No. 24006839
 Securities and Exchange Commission
       801 Cherry Street, Suite 1900
       Fort Worth, TX  76102
(817) 900-2607 (phone)
(817) 978-4927 (facsimile)
[email protected]

Counsel for Plaint iff
Securities and Exchange Commission

UNITED STATES DISTRICT COURT 
NORTHERN DISTRICT OF TEXAS 

DALLAS DIVISION 
 
  
SECURITIES AND EXCHANGE COMMISSION,  
  

Plaintiff,  
 C.A. No.: 3:21-cv-979 

v.  
  
RICHARD RANDALL. Jury Trial Demanded  
  

Defendant.  
  

 
COMPLAINT 

Plaintiff Securities and Exchange Commission (“SEC”) files this Complaint against 

Defendant Richard Randall (“Randall”) and alleges as follows:  

SUMMARY OF THE ACTION 

1. Randall and his recently deceased associate engaged in a fraudulent scheme to 

lure investors with an opportunity to purportedly invest in a revolutionary wireless technology 

for transmitting electricity, but then diverted most of the investor funds to themselves using shell 

companies they controlled that were not affiliated with the company developing the technology.  

The scheme centered on a securities offering of units in Wireless Power, LLC (“Wireless 

Power”).  Between approximately March 2015 and July 2016 (“Relevant Period”), the offering 

raised approximately $17.2 million from approximately 52 investors in multiple states and 

countries. 

2. The offering memorandum stated that Wireless Power would use investor funds 

to purchase equity interests in three purportedly affiliated companies – one that owned and was 

developing the technology, one that would market the technology, and one that would act as a 

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power broker to purchase electricity for resale using the technology.  In reality, almost 

immediately upon receipt, Wireless Power transferred substantially all of the investor funds to 

the bank accounts of two undisclosed companies that Randall controlled, and Randall misused 

and misappropriated most of the funds for his benefit, to pay his associate, to pay undisclosed 

sales commissions, and for other purposes not authorized by the offering memorandum. 

3. Randall’s primary role in the scheme was this unauthorized movement of investor 

funds, but he also engaged in other deceptive acts.  Randall held out the purported marketing 

company he controlled as a legitimate and valuable investment target in connection with the 

offering, when in fact it was a worthless shell company.  He also disguised the transfer of 

investor funds for his benefit through fictitious or, at a minimum, deceptive purported sales of 

the marketing company’s shares to Wireless Power, including by executing false documentation.  

In addition, Randall provided substantial assistance to Wireless Power in its making of 

misstatements and omissions in the offering memorandum and elsewhere about the use of 

investor funds and Randall’s purported marketing company as detailed below.     

4. By reason of this misconduct, Randall violated Sections 17(a)(1) and 17(a)(3) of 

the Securities Act of 1933 (the “Securities Act”) [15 U.S.C. §§ 77q(a)(1) and 77q(a)(3)] and 

Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) [15 U.S.C. § 78j(b)] 

and Rules 10b-5(a) and 10b-5(c) thereunder [17 C.F.R. §§ 240.10b-5(a) and 240.10b-5(c)], and 

he aided and abetted Wireless Power’s violations of Section 17(a) of the Securities Act [15 

U.S.C. § 77q] and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 

thereunder [17 C.F.R. § 240.10b-5].  The SEC brings this action seeking permanent injunctive 

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relief, disgorgement of ill-gotten gains plus prejudgment interest, civil penalties, and all other 

equitable and ancillary relief the Court deems necessary. 

JURISDICTION AND VENUE 

5. This Court has jurisdiction over this action pursuant to Sections 20(b), 20(d), and 

22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)] and Sections 21(d), 21(e), 

and 27 of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa].  Randall, directly or 

indirectly, made use of the means or instruments of transportation or communication, or the 

instrumentalities of interstate commerce or the mails, in connection with the transactions, acts, 

practices, and courses of business alleged herein.  

6. Venue is proper in this district pursuant to Section 22(a) of the Securities Act [15 

U.S.C. § 77v(a)] and Section 27 of the Exchange Act [15 U.S.C. § 78aa].  Certain of the 

transactions, acts, practices, and courses of business constituting violations of the federal 

securities laws occurred within this district.  Among other things, securities were offered and 

sold in this district, movement of investor funds occurred in this district, Randall transacts 

business within this district, and the principal places of business of Wireless Power, the Randall 

Companies, and some or all of the Target Companies, as defined below, are in this district.  

DEFENDANT 

7. Randall is an individual who resides in Collin County, Texas.  Randall was 

previously convicted of a felony in this district for violating 18 U.S.C. § 1014 for making a false, 

material statement for the purpose of influencing action on a loan by an institution, the deposits 

of which were insured by the FDIC.  Randall refused to appear for testimony during the SEC’s 

investigation of this matter. 

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FACTUAL ALLEGATIONS 
 

A. Relevant Entities.  

8. Wireless Power was formed as a Texas limited liability company on or about 

October 31, 2014, with its principal place of business in Dallas, Texas.  During the Relevant 

Period, a Dallas-based attorney served as Wireless Power’s registered agent and sole manager 

(“WP Manager”).  However, as alleged further below, Randall’s recently deceased associate 

(“Promoter”) controlled Wireless Power and directed the WP Manager’s activities related to 

Wireless Power and the offering. 

9. The “Technology Company” is identified by name in the offering materials and 

was formed as a Texas limited liability company on or about August 29, 2013, with its principal 

place of business in Red Oak, Texas.  Neither Randall nor the Promoter has ever been an officer, 

director, manager, or employee of the Technology Company, which at all times has been 

managed and controlled by unaffiliated third parties.        

10. The “Power Broker” is identified by name in the offering materials as Texanova 

Energy, Inc.  Upon information and belief, this entity has never existed.  A company with a 

similar name was formed as a Texas limited liability company on or about June 24, 2015, with 

its principal place of business in Dallas, Texas, and is, upon information and belief, the successor 

to a failed water hauling venture that the Promoter controlled.  During the Relevant Period, the 

Promoter controlled the Power Broker and was a signatory on its bank account.  During the 

Relevant Period, the Power Broker was a shell company with no or nominal operations or 

revenues and no or nominal assets, excluding Wireless Power investor funds that flowed through 

the company’s bank account. 

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11. The “Marketing Company” is identified by name in the offering materials as 

“Tesla Power Company, LLC.”  Tesla Power Company, LLC was formed as a Texas limited 

liability company on or about April 14, 2014, was also formed as a Delaware limited liability 

company on or about July 8, 2015, and uses a Rowlett, Texas address as its principal place of 

business.  During the Relevant Period, Randall controlled the Marketing Company, which, upon 

information and belief, did not have a bank account.  During the Relevant Period, the Marketing 

Company was a shell company with no or nominal operations or revenues, and no or nominal 

assets, arguably excluding its independent agency agreement with the Technology Company 

discussed below.   

12. The Technology Company, the Power Broker, and the Marketing Company are 

referred to collectively as the “Target Companies.” 

13. The “Randall Companies” are Holmes Financial Services, LLC and Holmes 

Trading Company, LLC.  The Randall Companies are not disclosed in the offering materials.  

The Randall Companies were formed as Texas limited liability companies on or about 

September 11, 2006 and September 10, 2009, respectively, with their principal places of business 

in Rowlett, Texas.  During the Relevant Period, Randall controlled the Randall Companies and 

was the sole signatory on their bank accounts. 

B. The Wireless Power Offering. 

1.  Background  

14. Randall had a pre-existing connection to persons associated with the Technology 

Company.  In 2014, Randall introduced the Promoter to the Technology Company and to the 

wireless technology for transmitting electricity it was developing (“Wireless Technology”).  

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Upon information and belief, the Promoter and Randall then together devised what became the 

Wireless Power offering.  The Promoter and Randall repeatedly referred to each other as 

“partners” in connection with the venture, even though their names never appeared in the 

Wireless Power offering materials.      

15. The Promoter approached the WP Manager and told him that he intended to 

create a company to raise funds to invest in the Target Companies.  On or about October 31, 

2014, the WP Manager formed Wireless Power at the Promoter’s request.   

16. The WP Manager has described his role at Wireless Power during the Relevant 

Period as essentially administrative, including maintenance of the books, records, and bank 

accounts.  At all times during the Relevant Period, the WP Manager took direction from and 

reported to the Promoter, who was Wireless Power’s agent and the person in de facto control of 

Wireless Power.    

2.  The offering memorandum. 

17. In early 2015, a written offering memorandum (“Offering Memo”) was prepared 

to offer for sale to investors units of interest in Wireless Power.  The Promoter took the lead role 

in drafting the Offering Memo, and he controlled and had ultimate authority over the statements 

in the Offering Memo, including its contents and whether and how to communicate them. 

18. Randall was also involved in the development of the Offering Memo.  At least as 

early as January 9, 2015, the Promoter sent the Offering Memo to Randall by email.  And the 

Promoter provided the Offering Memo to Randall for his review and comment on multiple 

occasions before it was used to raise investor funds in the general solicitation described below.     

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19. The Offering Memo states that Wireless Power was seeking to raise a total of $79 

million, through the sale of 79 units of Wireless Power (each unit represented 1% of the total 

authorized units of interest in the company).  The Offering Memo instructs investors to rely on 

the information contained in the Offering Memo.  

20. The Offering Memo claims that Wireless Power has the opportunity to invest in 

unique and proprietary wireless technology, and that investors would see “significant revenue 

streams” and would “mak[e] a tremendous impact on impoverished and developing nations and 

foster[] a global economic boom.”  The Offering Memo tells investors that “[w]e anticipate that 

our first year revenues will consist primarily of license fees in the amount of $1 billion” with 

annual royalties between 10% and 20% of gross revenue.   

21. The Offering Memo represents that Wireless Power would use investor funds to 

purchase equity interests in the Target Companies, which it represents are “3 affiliated 

companies that have been organized to capitalize on the discoveries [related to the Wireless 

Technology].”  Specifically, the Offering Memo represents that Wireless Power would use the 

investor funds to purchase a:  

• 4% equity interest in the Technology Company that possessed the 

exclusive global rights to the technology; 

• 16% equity interest in the Marketing Company, described as the “sole 

licensed Master Distributor for [the Technology Company,]” that 

would provide “outside licensing, marketing and sales of the 

technology globally;” and   

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• 24% equity interest in the Power Broker “formed for the purpose of 

acquiring and aggregating electricity from providers around the world 

for resale by [the Technology Company].”  

3.  The general solicitation. 

22. Wireless Power primarily used outside salespeople to market the offering to 

investors in multiple states and countries by phone and email in a general solicitation.  The 

Promoter directed the salespeople, and after contacting prospective investors, the salespeople 

often referred the investors to speak or meet with the Promoter directly.  The Promoter also made 

several presentations directly to prospective investors to solicit their investments.  Randall 

participated in several of the investor presentations and investor calls.  

23. In connection with these solicitations, investors received the Offering Memo, 

typically from the salespeople by email or through a link to an electronic drop box that the 

Promoter maintained that contained the Offering Memo and other offering materials.  The 

Offering Memo was used to solicit investments throughout the Relevant Period, and investor 

funds were raised beginning on or about March 2, 2015, and until at least as late as on or about 

July 5, 2016.  

24. The Offering Memo included subscription documents.  To purchase units, 

investors completed the subscription documents and returned them to the WP Manager.  The 

subscription documents instruct investors to wire funds to a Wireless Power bank account.   

25. The Offering Memo states that the offering of units in Wireless Power is an 

offering of securities.  Further, the units are investment contracts, and thus securities, under 

Section 2(a)(l) of the Securities Act and Section 3(a)(10) of the Exchange Act.  Investors paid 

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money for the units.  The investors’ role in the venture was entirely passive, a fact acknowledged 

in the Offering Memo.  The investors’ fortunes were dependent upon, and their expectation of 

profits derived solely from, the efforts and expertise of the promoters of Wireless Power and the 

Target Companies, which efforts were projected to generate substantial income.  Wireless Power 

also pooled investor funds to purportedly invest in the Target Companies, which further tied the 

investors’ fortunes to the success of the overall venture. 

26. Between approximately March 2, 2015 and July 5, 2016, approximately 52 

investors in multiple states and foreign countries invested approximately $17.2 million in the 

Wireless Power offering. 

C. The Scheme to Defraud.  

27. The Offering Memo makes clear that the stated purpose of the securities offering 

was to raise money to invest in and profit from the Wireless Technology that the Technology 

Company was developing.  To accomplish this, Wireless Power would invest funds in the 

Technology Company that held the rights to the Wireless Technology and two purportedly 

affiliated companies, one that would market the Wireless Technology (Marketing Company) and 

another that would purchase electricity for resale using the Wireless Technology (Power Broker).  

28. In reality, the offering was a scheme to use optimism about the potential 

technological advances of the Technology Company to siphon investor funds to Randall, the 

Promoter, and the salespeople.  To accomplish this scheme, the Offering Memo falsely presented 

the Wireless Power three-affiliated-company investment opportunity as the only way to invest in 

the Technology Company and its Wireless Technology.   

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29. The Technology Company was aware that persons associated with Wireless 

Power were seeking to raise money to invest in the Technology Company, but the Technology 

Company was seeking investments from other sources as well.  The Technology Company was 

also not involved in, much less endorsing, Wireless Power’s efforts to raise funds for the 

purported Marketing Company and Power Broker.  The Technology Company’s CEO at the time 

was shocked to later learn that Wireless Power was raising funds for these other entities in 

connection with its efforts to raise funds for the Technology Company.   

30. After investors sent their funds to Wireless Power, and unbeknownst to the 

investors and in direct contravention of the terms of the Offering Memo, Randall and the 

Promoter diverted most of the offering proceeds.  Often the same day or within days of investors 

wiring their funds into the Wireless Power bank account, the WP Manager, at the Promoter’s 

direction, transferred the investor funds to undisclosed bank accounts held by the Randall 

Companies and controlled by Randall, a convicted felon.  Randall then further diverted the 

investor funds by transferring most of the funds to himself, the Promoter, and other entities and 

individuals, including the salespeople.  The Offering Memo did not disclose Randall, his 

involvement in the offering, or his felony conviction.   

31. In furtherance of the scheme, and unbeknownst to investors, Randall also used a 

shell company he controlled for the Marketing Company, and the Promoter used a shell company 

he controlled for the Power Broker.  Randall and the Promoter then purportedly exchanged 

shares of their shell companies for investor funds, which they used for their personal benefit or 

other purposes that the Offering Memo did not authorize.  The Promoter also actually or 

fictitiously issued shares of the Power Broker to family members and the salespeople, and then 

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Wireless Power purportedly purchased these shares using investor funds.  Upon information and 

belief, the share transactions were not properly documented, if they were documented at all.   

32. The Offering Memo did not disclose that Randall, the Promoter, or other persons 

purportedly held shares of the Marketing Company or the Power Broker, that Wireless Power 

would be purchasing shares from them or for their benefit, or that Randall, the Promoter, their 

families, or the salespeople held any interests in the companies.  To the contrary, the Offering 

Memo represents that the Marketing Company and the Power Broker were newly formed 

companies affiliated with the Technology Company, and investors were led to believe that their 

funds would be invested in the Target Companies themselves and used as working capital to 

fund the Target Companies’ operations.  Yet, the Marketing Company received no investor funds 

as a result of the offering, and the Power Broker (but not the entity named in Offering Memo, 

which, upon information and belief, does not exist) received only approximately $110,000 

directly from Wireless Power and $222,000 from one of the Randall Companies. 

33. Of the approximately $17.2 million raised from Wireless Power investors, 

approximately $3.3 million was later returned or refunded to investors, leaving approximately 

$14 million available to invest in the Target Companies.  Bank records indicate, however, that 

approximately two-thirds of these funds were misused or misappropriated.   

D. Randall Misused and Misappropriated Investor Funds. 
 

34. Randall misused and misappropriated investor funds in direct violation of 

Sections 17(a)(1) and 17(a)(3) of the Securities Act and Section 10(b) of the Exchange Act and 

Rules 10b-5(a) and 10b-5(c) thereunder. 

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  1.  How investor funds could be used.  

35. The Offering Memo states that Wireless Power would use the proceeds of the 

offering to purchase “equity” interests in the three “affiliated” Target Companies.  The Offering 

Memo further represents that the Target Companies are “newly formed organizations [that] have 

no significant financial history,” and that the “primary purpose of this offering is to invest in the 

[Target Companies] that have been formed to launch” the Wireless Technology.   

36. Pursuant to the Offering Memo, “[p]ending application of the net proceeds of this 

offering, the Company may invest the net proceeds from this offering in short-term, interest-

bearing securities.”  The Offering Memo represents that “no selling commissions will be paid,” 

and discloses that the maximum approximate amount of offering expenses would be $50,000.          

37. During an organized investor telephone conference call on or about June 25, 2015 

(“Investor Conference Call”), the Promoter described the Wireless Power offering as a first 

phase of capitalization.  A transcript of the Investor Conference Call was posted in the drop box 

of offering materials, and, upon information and belief, was available to investors through the 

end of the Relevant Period.  Randall attended and spoke to investors during the Investor 

Conference Call, and he had access to the drop box.   

38. The Offering Memo did not authorize or disclose that any investor funds would 

be: (a) transferred to the Randall Companies; (b) distributed to Randall, the Promoter, or their 

affiliates or family members; (c) paid to salespeople; (d) used to purchase or create a market for 

shares in the Power Broker or the Marketing Company held by Randall, the Promoter, the 

salespeople, or other persons; or (d) used to make loans. 

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2.  How Randall actually used investor funds. 

39. Randall used the Randall Companies’ accounts as a device to misuse and 

misappropriate investor funds.  Randall provided the account information and authorizations 

necessary for Wireless Power to transfer investor funds to the Randall Companies’ accounts.  

After Wireless Power improperly transferred investor funds to the Randall Companies’ accounts, 

Randall, as signatory on those accounts, caused the investor funds to be further diverted to 

himself, the Promoter, the salespeople, and for other improper purposes through a series of wires 

and other bank transactions.  

40. Wireless Power, at the Promoter’s direction, disbursed approximately $16.6 

million of the $17.2 million raised from the Wireless Power investors from Wireless Power’s 

bank account to the Randall Companies’ bank accounts.  The transfers occurred repeatedly 

throughout the Relevant Period, beginning on about May 15, 2015, and continuing as late as 

approximately July 11, 2016.  The Offering Memo did not authorize or disclose the transfers of 

investor funds to the Randall Companies, which themselves were not disclosed in the Offering 

Memo and were controlled by Randall.       

41. The investor funds were commingled with other funds in the Randall Companies’ 

accounts, and Randall then caused the Randall Companies to disburse all of the funds in those 

accounts, including all of the $16.6 million of investor funds, from the accounts, including by:  

a. Randall causing the Randall Companies to disburse approximately $5.3 

million of the investor funds from the Randall Companies’ accounts to his personal accounts and 

to investment accounts that he controlled and used for his benefit.  These transfers occurred 

repeatedly throughout the Relevant Period, beginning on or about May 15, 2015, and continuing 

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as late as approximately November 9, 2017.  Not only were these transfers not authorized or 

disclosed, the Offering Memo did not even identify Randall. 

b. Randall causing the Randall Companies to disburse approximately $2.2 

million of the investor funds from the Randall Companies’ accounts to personal and business 

accounts of the Promoter.  These transfers occurred repeatedly throughout the Relevant Period, 

beginning on or about May 22, 2015, and continuing as late as approximately June 9, 2016.  

Again, these transfers were not authorized or disclosed in the Offering Memo. 

c. Randall causing the Randall Companies to disburse approximately $1.6 

million of the investor funds to pay sales commissions to the salespeople for their work soliciting 

investors.  These payments occurred repeatedly throughout the Relevant Period, beginning on or 

about June 5, 2015, and continuing as late as approximately October 14, 2016.  The Offering 

Memo did not authorize or disclose the payments to the salespeople, and in fact expressly stated 

that no selling commissions would be paid in connection with the offering and capped offering 

expenses at approximately $50,000. 

d. Randall also caused the Randall Companies to disburse investor funds to 

fund loans, including disbursing approximately $480,000 between approximately February 5, 

2016 and August 17, 2016, to fund loans to an undisclosed third-party company, with interest 

and principal payable to one of the Randall Companies (and not to Wireless Power or its 

investors).  The Offering Memo did not authorize or disclose the use of investor funds for loans, 

much less loans payable to one of the Randall Companies. 

42. Each of these transfers of investor funds that Randall accepted into the Randall 

Companies’ accounts and each of these transfers of investor funds that he caused to be made out 

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of those accounts was a deceptive act that Randall committed in furtherance of the scheme.  The 

transfers occurred while the offering was ongoing, and often the same day or within days of 

investors wiring their funds into the Wireless Power bank account.  The transfers enabled 

Randall and the Promoter to accomplish the purpose of the scheme, which was to cash out the 

investor funds for their benefit.  

43. The bank records do not show any funds distributed from the Randall Companies’ 

accounts to the Marketing Company, and show only approximately $220,000 distributed from 

the Randall Companies’ accounts to the Power Broker (but not to the Power-Broker entity  

identified in the Offering Memo, which, upon information and belief, does not exist). 

44. Randall did distribute approximately $4.7 million to the Technology Company 

from the Randal Companies’ accounts.  In June 2015, and while Wireless Power was still raising 

investor funds pursuant to the Offering Memo, Randall, through one of the Randall Companies, 

entered into an agreement with the Technology Company granting that Randall Company the 

right to purchase up to two million units of the Technology Company directly.  The Randall 

Company used the $4.7 million to purchase units in the Technology Company pursuant to this 

option agreement, which the Offering Memo did not disclose.  Upon information and belief, 

some or all of these units were ultimately transferred to Wireless Power.   

45. To date, the SEC’s staff has been unable to perform a complete segregation of the 

distributions from the Randall Companies’ accounts as a result of the extensive commingling of 

investor funds in the Randall Companies’ accounts, Randall’s failure to maintain and produce 

adequate books and records, and Randall’s refusal to appear and explain the transactions.   

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46. Randall’s misuse and misappropriation of investor funds was material.  A 

reasonable investor would consider the facts that the offering proceeds would not be used as 

represented and would instead be diverted to undisclosed accounts controlled by a convicted 

felon, comingled with other funds, and disbursed for the personal benefit of undisclosed 

individuals and salespeople promoting the offering to be important in deciding whether to invest 

in the offering. 

E. Randall Used The Marketing Company Deceptively.  

47. Randall engaged in additional deceptive acts relating to the Marketing Company 

in direct violation of Sections 17(a)(1) and 17(a)(3) of the Securities Act and Section 10(b) of the 

Exchange Act and Rules 10b-5(a) and 10b-5(c) thereunder. 

1. Randall helped create a false appearance. 

48. Randall was able to obtain investor funds from the scheme because he helped 

Wireless Power create a false appearance of fact about the Marketing Company that was used to 

convince Wireless Power investors to invest funds to purchase the Marketing Company’s equity 

interests.   

49. Wireless Power falsely presented the Marketing Company as a legitimate and 

lucrative business.  As alleged in more detail at Section F.2 below: 

• The Offering Memo represents that the Marketing Company is affiliated with the 

Technology Company.  It was not.   

• The Offering Memo represents that the Marketing Company has a Master 

Distribution agreement with the Technology Company.  It did not.   

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• The Offering Memo states the Marketing Company will provide outside licensing, 

marketing and sales of the technology globally.  It was a shell company and could 

not.   

• The Offering Memo represents that a public offering of shares in the Marketing 

Company would be the only vehicle available to the public for investment in the 

Wireless Technology.  This representation was false and misleading. 

• The Offering Memo projects the Marketing Company would earn approximately 

$163 million, $1.8 billion, and $3.5 billion in revenues during 2015, 2016, and 2017, 

respectively.  The Marketing Company had no revenue or ability to generate revenue. 

50. Randall participated in creating this false appearance of fact.  The Promoter 

provided the Offering Memo to Randall on multiple occasions for his review and comment, 

including by email on January 9, 2015, and, upon information and belief, the Promoter and 

Randall also orally discussed the terms of the Offering Memo before it was used in the general 

solicitation to obtain investor funds.  Thus, Randall knowingly authorized and allowed Wireless 

Power to use the Marketing Company he controlled as one of the Target Companies in the 

Offering Memo, even though it was a shell company, which, upon information and belief, did 

not even have a bank account, and he likewise authorized and allowed Wireless Power to, as 

alleged above and at Section F.2 below, falsely present the Marketing Company and its 

agreement with the Technology Company in the Offering Memo.        

51. Randall also participated in investor calls and investor presentations as a 

representative of the Marketing Company to perpetuate the false appearance of fact.  During the 

Investor Conference Call, for example, the Promoter introduced Randall as one of the principals 

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of the Marketing Company, which he described as the marketing entity for all of the Wireless 

Technology, and stated a future public offering of the Marketing Company’s shares would be the 

only vehicle to invest in a part of the Wireless Technology after the Wireless Power offering.  

Randall then spoke to the investors, but did nothing to correct this false impression of the 

Marketing Company, much less disclose that it was, in reality, his shell company.   

52. As another example, in approximately early June 2015, Randall, the Promoter, 

and several salespeople participated in a telephone conference call with an investor in Florida.  

The investor was told that the Marketing Company had an exclusive marketing agreement with 

the Technology Company, and that the Wireless Power offering was the only way to invest in the 

Technology Company, neither of which was true.  That latter point was reiterated to the investor 

in a subsequent telephone conference call on or about June 25, 2015, in which Randall also 

participated.  Randall affirmatively made one or more of these misstatements to the investor, or, 

at a minimum, he helped create the false impression being advanced by participating on the call 

as a representative of the Marketing Company and doing nothing to correct it.            

2. Randall engaged in deceptive share transactions. 

53. The Offering Memo stated that Wireless Power would use a percentage of the 

investor funds to purchase equity interests in the Marketing Company.  To further the scheme, 

Randall disguised his misuse and misappropriation of investor funds as Wireless Power 

purchases of interests in the Marketing Company.  These purported purchases, however, were 

fictitious or, at a minimum, deceptive, because investors funds were not used to capitalize the 

Marketing Company, and were instead diverted for Randall’s benefit.  The principal purpose and 

effect of the sham sales was to further the scheme by enabling Randall to use his shell 

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company’s worthless shares to obtain investor funds while furthering the false narrative that 

investors were providing capital to launch an actual marketing company.   

54. To illustrate, in June 2015, an investor asked the Promoter for confirmation that 

Wireless Power possessed the rights to acquire interests in the Marketing Company.  In response, 

on June 17, 2015, the Promoter sent Randall an email asking him to draft and sign a letter on the 

Marketing Company’s letterhead granting options from the Marketing Company to Wireless 

Power.  Randall then executed the requested letter on behalf of the Marketing Company, which 

was addressed to Wireless Power, and provided it to the Promoter by email on June 19, 2015. 

The letter states that the Marketing Company owns or controls and has granted Wireless Power 

the option to purchase 16,000,000 shares of the Marketing Company’s common stock at a price 

of $1.92 per share.  But to the extent Wireless Power purchased any shares (or units) of the 

Marketing Company, unbeknownst to investors, it purchased them from Randall or other 

purported Marketing Company shareholders.  In short, Randall, through this deceptive letter, 

created the false impression that the Marketing Company was selling company shares to raise 

capital, when he knew this was not true. 

55. Upon information and belief, there was no valid sale or transfer of the Marketing 

Company’s shares or units to Wireless Power at or around the time of the transfers of investor 

funds, and Randall has produced no documentation to support any such transactions in response 

to the SEC’s document subpoena during its investigation that preceded the filing of this lawsuit.      

F. Randall Aided and Abetted Wireless Power. 

56. In connection with the offer, sale, and purchase of the Wireless Power units, 

Wireless Power made material misrepresentations and omissions to investors and engaged in 

other fraudulent conduct in furtherance of the scheme in direct violation of Section 17(a) of the 

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Securities Act and Section 10(b) of the Exchange Act and Rules 10b-5(a) thereunder.  Randall 

aided and abetted the violations by providing substantial assistance to Wireless Power.  

1. Misstatements and omissions about the use of funds. 

57. As alleged above, the Offering Memo states that: (a) Wireless Power would use 

the proceeds of the offering to purchase equity interests in the three Target Companies; (b) the 

Target Companies are newly formed organizations; (c) the primary purpose of the offering is to 

invest in the Target Companies that have been formed to launch the Wireless Technology; (d)  

pending application of the net proceeds of the offering, Wireless Power may invest the net 

proceeds in short-term, interest-bearing securities; (e) no selling commissions will be paid; and 

(f) the maximum approximate amount of offering expenses will be $50,000.  In the Investor 

Conference Call, the Promoter represented the offering was a first phase of capitalization. 

58. These statements about the use of investor funds are false and misleading.  

Wireless Power did not use the investor funds as promised.  Instead, the Promoter and Randall 

diverted most of the investor funds to themselves, to the salespeople as sales commissions, to 

make loans, and for other purposes not authorized by the Offering Memo as alleged above.       

59. Having chosen to make statements to investors in the Offering Memo about how 

investor funds would be used, Wireless Power also failed to state facts necessary in order to 

make the statements, in light of the circumstances under which they were made, not misleading.  

Wireless Power failed to disclose that investor funds would be: (a) transferred to the Randall 

Companies; (b) distributed to the Promoter, Randall, or their affiliates or family members; (c) 

paid to salespeople; (d) used to purchase or create a market for the shares of the Power Broker 

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and the Marketing Company held by Randall, the Promoter, the salespeople, or others persons; 

and (e) used to make loans.   

60. The Offering Memo states that the Target Companies were newly formed, had no 

substantial financial history, and had been formed to launch the Wireless Technology.  But the 

Offering Memo did not disclose that the Promoter, Randall, and the salespeople purportedly held 

interests in the Power Broker and/or Marketing Company, and that investor funds would be used 

to purchase shares from individuals and not disbursed directly to the Power Broker and 

Marketing Company.  This was misleading as it led investors to believe their funds would be 

used to help launch and capitalize the Power Broker and Marketing Company, when in fact, the 

funds were going to the Promoter, Randall, and the salespeople. 

61. The misstatements and omissions relating to the use of investor funds are 

material.  A reasonable investor would consider the facts that the offering proceeds would not be 

used as represented and would instead be diverted to undisclosed accounts controlled by a 

convicted felon and disbursed for the personal benefit of undisclosed individuals and salespeople 

promoting the offering to be important in deciding whether to invest in the offering. 

2.  Misstatements and omissions about the Marketing Company. 

62. The Offering Memo represents that the Technology Company is affiliated with 

the Marketing Company and the Power Broker, and an offering summary document describes the 

offering as an investment in “three affiliated companies who have joined.”   

63. These statements are false and misleading, because the Technology Company was 

not affiliated with the Marketing Company or the Power Broker, which were controlled by 

Randall and the Promoter, respectively.   

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64. The Offering Memo identifies the projected public offering of shares in the 

Marketing Company “as the only vehicle available to the public for investment in this new 

technology” and the offering summary represents that the offering is the “exclusive opportunity 

to invest in the unique and proprietary ability to deliver disruptive and innovative energy and 

data technologies on a global scale…”  During the Investor Conference Call, the Promoter stated 

that a future public offering of the Marketing Company would be the only vehicle to invest in a 

part of the Wireless Technology after the Wireless Power offering. 

65. These statements are false and misleading.  Wireless Power was not the only 

opportunity for investors to invest in the Technology Company or its Wireless Technology.  

During the Relevant Period, the Technology Company was accepting direct investments 

unrelated to the Wireless Power offering and unconnected to any purported future public offering 

of the Marketing Company.   

66. The Offering Memo represents that the Marketing Company “has a Master 

Distribution Agreement” with the Technology Company making the Marketing Company “the 

sole Master Distributor” of the Wireless Technology, and states the Marketing Company “will 

provide outside licensing, marketing and sales of the technology globally.”  Investors were also 

told orally that the Marketing Company had an exclusive marketing agreement with the 

Technology Company, including during the call with the Florida investor in approximately early 

June 2015.   

67. These statements are false and misleading.  The Marketing Company did not have 

a Master Distribution Agreement with the Technology Company, and it was not the sole licensed 

Master Distributor for the Technology.  The Marketing Company had an Independent Agency 

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Agreement with the Technology Company that did not make it a Master Distributor, which 

expressly stated that the Marketing Company only had rights to market the Wireless Technology 

on a non-exclusive basis, and confirmed that the parties were independent of each other.  The 

Offering Memo further misleads investors by omitting that that Marketing Company was a shell 

company in no position to provide outside licensing, marketing and sales of the technology 

globally.       

68. The Offering Memo represents that the WP Manager would represent Wireless 

Power’s interests as a member of the board of directors of the Marketing Company and the 

Power Broker.  This was false and misleading.  The WP Manager was never a member of or 

asked to serve on the board of directors for the Marketing Company or the Power Broker.  Upon 

information and belief, neither the Marketing Company nor the Power Broker even had a board 

of directors.   

69. The Offering Memo includes income projections showing the Marketing 

Company earning approximately $163 million, $1.8 billion, and $3.5 billion in revenues during 

2015, 2016, and 2017, respectively.  The projections include line item detail showing millions of 

dollars of operational costs, including salaries, labor, and office costs, for the Marketing 

Company in each year.   

70. These projections were false and misleading.  The Offering Memo omits material 

and critical facts, including that: (a) the Marketing Company was a shell company with no 

reasonable ability to fulfill the projected multi-billion dollar business plan; (b) the Marketing 

Company had only a non-exclusive agreement with the Technology Company; and (c) the Target 

Companies were not actually working together as affiliates to accomplish the purported business 

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plan giving rise to the projections.  The Offering Memo was also used to solicit investors during 

2016, and by that time the statements about the prior time periods imbedded factual 

misstatements, or at a minimum, were misleading by omission, because substantially none of the 

stated revenues were achieved or costs incurred. 

71. The misstatements and omissions about the Marketing Company were material.  

The Offering Memo contemplated that Wireless Power would use a minimum of approximately 

46.7%, and a maximum of approximately 49.1%, of investor funds to purchase equity interests in 

the Marketing Company, whose business model was based entirely on monetizing the 

technology rights that the Technology Company owns.  A reasonable investor would therefore 

consider the facts that the Marketing Company was not actually affiliated with the Technology 

Company and did not have a master distributor or exclusive arrangement with the Technology 

Company important in deciding whether to invest.   

72. In evaluating the Marketing Company’s ability to successfully market the 

Wireless Technology, a reasonable investor would also consider the facts that the Marketing 

Company was a shell company and that the WP Manager, who was described in the Offering 

Memo as an AV-rated attorney, would not in fact be protecting investor interests on its board, to 

be important in deciding whether to invest.  A reasonable investor would likewise consider the 

fact that it could invest directly in the Technology Company that held the Wireless Technology 

without diluting their investment dollars to fund Randall’s company important in deciding 

whether to invest 

3.  Randall provided substantial assistance. 

73. Randall provided substantial assistance to Wireless Power in the making of the 

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misrepresentations and omissions to investors about the use of their funds and in accomplishing 

the scheme to misuse those funds by using his Randall Companies’ accounts to accept and 

distribute investor funds from those accounts for the improper purposes alleged above.  Randall’s 

actions were critical to Wireless Power’s ability to divert the investor funds and to conceal the 

diversion of investor funds from investors. 

74. Randall also provided substantial assistance to Wireless Power in the making of 

the misstatements and omissions about the Marketing Company and in creating a false 

appearance of fact about the Marketing Company in furtherance of the scheme.  Randall 

authorized and allowed Wireless Power to deceptively use and reference the Marketing 

Company and its non-exclusive independent agency agreement in the Offering Memo and in 

other solicitations to investors.  As alleged above, Randall also participated in investor calls as a 

representative of the Marketing Company that portrayed the Marketing Company in a false light.  

Randall also executed and caused the Marketing Company to provide the false and misleading 

letter indicating that the Marketing Company was selling company shares to Wireless Power.   

G. Randall Acted With Scienter. 

75. Randall had motive and opportunity to commit the fraud.  Randall was able to 

obtain millions of dollars in investor funds for himself as a result of his deceptive acts, including 

by taking investor funds purportedly in exchange for shares of his shell company that he would 

not have been able to liquidate for any meaningful value in the absence of the scheme.  Randall 

sent approximately $5.3 million of investor funds to his personal accounts and to investment 

accounts that he controlled and used for his benefit.  

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76. Randall also engaged in the alleged misconduct knowingly or, at a minimum, with 

severe recklessness.  Randall was involved in the development of the Offering Memo and 

received it early in the Relevant Period.  He therefore knew that the Offering Memo did not 

authorize Wireless Power to transfer investor funds to his undisclosed companies, or at a 

minimum was severely reckless in ignoring the Offering Memo’s terms.  For the same reason, 

Randall knew that the distributions he was making from the Randall Companies’ accounts to pay 

commissions, to fund loans, and to pay himself and the Promoter, among others, were improper, 

or he was severely reckless in making them in violation of the terms of the Offering Memo.   

77. Randall also knew that he was receiving Wireless Power investor funds.  The 

Promoter and WP Manager kept Randall apprised of the flow of investor funds from Wireless 

Power to the Randall Companies, and Randall received multiple emails from the Promoter and 

the WP Manager advising him that investor funds were coming into Wireless Power and, upon 

receipt, would be wired to the Randall Companies’ accounts, including a series of emails on or 

about August 5, 2015 and August 6, 2015.  

78. Randall further knew where he was transferring the investor funds, because the 

transfers are evident on the face of the Randall Companies’ bank records, and much of the funds 

were going to him and the Promoter.  He also knew he was paying commissions, because as 

early as January 23, 2015, the Promoter provided Randall a distribution schedule showing a 

breakdown of commission payments.  He also knew he was funding loans, because the loans 

were payable to one of the Randall Companies, and he received communications relating to the 

loans.   

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79. Randall also knew that Wireless Power continued to raise funds from new 

investors after the misuse of earlier investor funds, and that these new investor funds would be 

misused as well.  Because the investor funds were moving in and out of the Randall Companies’ 

accounts during the offering, the Promoter was keeping Randall apprised of the efforts to raise 

funds in the offering, and Randall was participating in investor calls.   

80. Randall further knew about, or was severely reckless in ignoring, the false 

statements that were being made about the Marketing Company in the Offering Memo and 

during the investor calls.  He controlled the Marketing Company, and therefore knew it was a 

shell company and was not affiliated with the Technology Company.  He similarly knew that the 

WP Manager was not a director of the Marketing Company.  

81. Randall also signed the non-exclusive, independent agency agreement on behalf 

of the Marketing Company, and he therefore knew that it was not an exclusive or master 

distribution agreement.  Randall also knew that Wireless Power was not the exclusive 

opportunity to invest in the Technology Company, because he knew one of the Randall 

Companies obtained an option to purchase shares in the Technology Company after the offering 

commenced, and, upon information and belief, Randall also knew that that the Technology 

Company was pursuing direct investments from one or more other investor groups. 

82. Randall knew that he caused his controlled company to issue a false and 

misleading letter indicating that the Marketing Company would be selling its shares to Wireless 

Power. 

H. Wireless Power Acted with Scienter. 

83. The state of mind of Wireless Power’s agents, including the Promoter, are 

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imputed to Wireless Power. 

84. The Promoter had motive and opportunity to commit the fraud.  The Promoter 

was, like Randall, able to obtain millions of dollars in investor funds for himself and his family 

members, including by cashing out worthless shares of a shell company that he would not have 

been able to liquidate for any meaningful value in the absence of the scheme.  

85. The Promoter engaged in the alleged misconduct knowingly.  The Promoter 

prepared the Offering Memo and was familiar with its contents.  The Promoter therefore knew 

that investor funds were being used in a manner that the Offering Memo did not authorize, 

including that Wireless Power was transferring investor funds to the undisclosed Randall 

Companies at his direction, that the funds were used for a loan to the Technology Company he 

was involved in negotiating, and that investor funds were distributed to him, his family members, 

Randall, and the salespeople.  The Promoter knew he was using investor funds to pay 

commissions, which he expressly acknowledged in emails that he sent to Randall.  The 

Promoter, like Randall, also knew that the Offering Memo continued to be used to raise funds 

from new investors after the misuse of earlier investor funds and that these new investor funds 

would be misused as well. 

86. The Promoter further knew that the purported Power Broker that he controlled 

was not affiliated with the Technology Company and that Randall’s purported Marketing 

Company was not either, or he was, at a minimum, severely reckless in making such a claim.  He 

also knew that the WP Manager was not a director for either of those companies, and in fact he 

never asked the WP Manager to be on the boards of either of the two shell companies, which, 

upon information and belief, had no boards.   

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87. The Promoter also knew that Wireless Power was not the exclusive opportunity to 

invest in the Technology Company or, at a minimum, was severely reckless in claiming that it 

was, including because: (a) he knew at the time of the offering that Wireless Power did not have 

a lock up or any other type of exclusivity agreement with the Technology Company, and (b) 

Randall informed him that one of the Randall Companies obtained options to purchase shares in 

the Technology Company during the offering.  The Promoter further knew that the Marketing 

Company did not have an exclusive or master distribution agreement with the Technology 

Company, or at a minimum, was severely reckless in claiming that it did, because the Promoter 

had seen no such agreement, and because he had the actual, non-exclusive independent agency 

agreement in his possession. 

FIRST CLAIM FOR RELIEF 

Sections 17(a)(1) and 17(a)(3) of the Securities Act 
 

88. The SEC incorporates by reference each and every allegation contained in 

paragraphs 1-87  above. 

89. By engaging in the conduct described herein, Randall, directly or indirectly, 

singly or in concert with others, in the offer or sale of securities, by use of the means and 

instrumentalities of interstate commerce and/or by use of the mails has: (a) employed devices, 

schemes, or artifices to defraud; and/or (b) engaged in transactions, practices, or courses of 

business which operate or would operate as a fraud or deceit upon the purchasers. 

90. With regard to Randall’s violations of Section 17(a)(1) of the Securities Act, 

Randall engaged in the conduct knowingly or with severe recklessness.  With regard to Randall’s 

violations of Section 17(a)(3) of the Securities Act, Randall engaged in the conduct knowingly, 

with severe recklessness, or at least negligently.    

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91. By reason of the foregoing, Randall violated and, unless enjoined, will continue to 

violate, Sections 17(a)(1) and 17(a)(3) of the Securities Act [15 U.S.C. §§ 77q(1) and 77q(3)]. 

SECOND CLAIM FOR RELIEF 

Section 10(b) of the Exchange Act and Rules 10b-5(a) and 10b-5(c) thereunder 
 

92. The SEC incorporates by reference each and every allegation contained in 

paragraphs 1-87 above. 

93. By engaging in the conduct described herein, Randall, directly or indirectly, 

singly or in concert, by the use of the means or instrumentalities of interstate commerce and/or 

by use of the mails, in connection with the purchase or sale of securities: (a) employed devices, 

schemes, or artifices to defraud; and/or (b) engaged in acts, practices, or courses of business 

which operate or would operate as a fraud or deceit upon purchasers, prospective purchasers, and 

any other persons. 

94. Randall engaged in this conduct knowingly or with severe recklessness.   

95. By reason of the foregoing, Randall violated and, unless enjoined, will continue to 

violate Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rules 10b-5(a) and 10b-5(c) 

thereunder [17 C.F.R. §§ 240.10b-5(a) and 240.10b-5(c)]. 

THIRD CLAIM FOR RELIEF 

Aiding and Abetting Violations of Section 17(a) of the Securities Act  
and Section 10(b) of the Exchange Act and Rule 10b-5(b) Thereunder 

 
96. The SEC incorporates by reference each and every allegation contained in 

paragraphs 1-87  above. 

97. By engaging in the conduct described herein, Wireless Power, directly or 

indirectly, singly or in concert with others, in the offer or sale of securities, by use of the means 

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and instrumentalities of interstate commerce and/or by use of the mails has: (a) employed 

devices, schemes, or artifices to defraud; and/or (b) obtained money or property by means of 

untrue statements of a material fact and/or omitted to state a material fact necessary in order to 

make the statements made, in light of the circumstances under which they were made, not 

misleading; and/or (c) engaged in transactions, practices, or courses of business which operate or 

would operate as a fraud or deceit upon the purchasers. 

98. By engaging in the conduct described herein, Wireless Power, directly or 

indirectly, singly or in concert, by the use of the means or instrumentalities of interstate 

commerce and/or by use of the mails, in connection with the purchase or sale of securities: (a) 

employed devices, schemes, or artifices to defraud; and/or (b) made untrue statements of a 

material fact and/or omitted to state a material fact necessary in order to make the statements 

made, in light of the circumstances under which they were made, not misleading; and/or (c) 

engaged in acts, practices, or courses of business which operate or would operate as a fraud or 

deceit upon purchasers, prospective purchasers, and any other persons. 

99. With regard to Wireless Power’s violations of Section 17(a)(1) of the Securities 

Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, Wireless Power engaged 

in the conduct knowingly or with severe recklessness.  With regard to Wireless Power’s 

violations of Sections 17(a)(2) and 17(a)(3) of the Securities Act, Wireless Power engaged in the 

conduct knowingly, with severe recklessness, or at least negligently.    

100. By engaging in the conduct described above, Randall knowingly or recklessly 

provided substantial assistance to Wireless Power’s violations of Section 17(a) of the Securities 

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Act [15 U.S.C. § 77q] and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-

5 thereunder [17 C.F.R. § 240.10b-5].  

101. By reason of the foregoing, pursuant to Section 15(b) of the Securities Act and 

Section 20(e) of the Exchange Act, Randall aided and abetted Wireless Power’s violations of, 

and unless restrained and enjoined will continue to aid and abet violations of, Section 17(a) of 

the Securities Act [15 U.S.C. § 77q(a)] and Section 10(b) of the Exchange Act [15 U.S.C. § 

78j(b)] and Rule 10b-5 [17 C.F.R. § 240.10b-5] thereunder. 

TOLLING AGREEMENT 

102. Randall executed a tolling agreement with the SEC.  The tolling agreement 

specifies a period of time beginning on February 1, 2020 through April 30, 2020 (“tolling 

period”) during which the running of any statute of limitations applicable to any action or 

proceeding arising out of the SEC’s investigation of Randall’s conduct, including any sanctions 

or relief that may be imposed therein, is tolled and suspended.  The tolling agreement further 

provides that Randall and any of his agents or attorneys “shall not include the tolling period in 

the calculation of the running of any statute of limitations or for any other time-related defense 

applicable to any proceeding, including any sanctions or relief that may be imposed therein, in 

asserting or relying upon any such time-related defenses.”  The tolling agreement tolled the 

running of any limitations period or any other time-related defenses applicable to the allegations 

in this Complaint during the tolling period. 

JURY TRIAL DEMAND 

103. The SEC demands a trial by jury on all issues that may be so tried. 

  

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RELIEF REQUESTED 

Therefore, the SEC respectfully requests that this Court: 

(a) Permanently enjoin Randall from violating, directly or indirectly, Section 

17(a) of the Securities Act [15 U.S.C. § 77q] and Section 10(b) of the 

Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. 

§ 240.10b-5]; 

(b) Order Randall to disgorge all ill-gotten gains and/or unjust enrichment 

realized by him, plus prejudgment interest thereon; 

(c) Order Randall to pay a civil penalty pursuant to Section 20(d) of the 

Securities Act [15 U.S.C. § 77t(d)] and/or Section 21(d)(3) of the 

Exchange Act [15 U.S.C. § 78u(d)(3)]; and 

(d) Grant such further relief as this Court may deem just and proper. 

 
 
Dated: April 30, 2021     Respectfully submitted, 
 

/s/ Keefe M. Bernstein___________ 
 Keefe M. Bernstein 
 Lead Attorney   

       Texas Bar No. 24006839 
 Securities and Exchange Commission  
       801 Cherry Street, Suite 1900 
       Fort Worth, TX  76102  

(817) 900-2607 (phone)  
(817) 978-4927 (facsimile) 
[email protected] 

        
Counsel for Plaintiff  
Securities and Exchange Commission

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	SECOND CLAIM FOR RELIEF
	Section 10(b) of the Exchange Act and Rules 10b-5(a) and 10b-5(c) thereunder