Wednesday 06 March 2013
Per my email from
Fred Joseph, Banking and Securities Commissioner or
Gerald Rome, Deputy Securities Commissioner at 303-894-2320
For Immediate Release – March 1, 2013
HEDGE FUND OPERATOR CHARGED WITH
SECURITIES LAW VIOLATIONS
(Denver, Colorado --- Colorado Securities Commissioner Fred Joseph announced today that he has filed a complaint in Denver District Court against a Longmont man and his related businesses alleging that he has violated the anti-fraud and licensing provisions of the Colorado Securities Act in connection with their marketing and management of Colony Capital, LLC, Colony Capital LP, and Colony Capital Group (“Colony Capital”), a “private equity fund” operating most recently out of Longmont, Colorado.
Named in the complaint in addition to the Colony Capital entities are Gary Snisky of Longmont, Colorado, David Burch of Aurora, Colorado, and Brenda Ridley of Bakersfield, California. At all times relative to this complaint, none of these Defendants were licensed in any capacity with the Securities Commissioner.
In the complaint, the Commissioner has alleged that the Defendants carried out a scheme to defraud investors in a private equity fund controlled by Snisky. From 2008 through July, 2010, Snisky allegedly induced over 20 investors to invest at least $3.2 million based on promises of returns on their investments. Snisky promoted the investment by telling investors that his investment strategies will “protect principal and maximize the return on investment.” The complaint alleges that Snisky failed to disclose even rudimentary information to the investors. It is alleged that investors were unaware that Snisky intended to use their investment proceeds to pay for such items as the personal expenses of Snisky, including mortgage payments, the nature and amount of fees to be charged, and a percentage of any profits. The complaint further alleges that Snisky, despite incurring trading losses, enriched himself at the investor’s expense.
The complaint charges Snisky with engaging in investment adviser fraud, securities fraud, offer and sale of unregistered securities and unlicensed investment adviser activity. Burch and Ridley are charged with engaging in unlicensed securities sales activity. The complaint requests that the court enjoin the defendants and seeks an award of damages on behalf of investors harmed by the Defendants.
The Colorado Division of Securities is responsible for the administration and enforcement of the Colorado Securities Act, the Colorado Commodity Code, the Colorado Municipal Bond Supervision Act, and the Local Government Investment Pool Trust Fund Administration and Enforcement Act. The Division licenses and regulates stockbrokers and investment advisers and the securities investments they offer, sell, and advise about in Colorado. The Division also investigates cases of alleged securities fraud.
DORA is dedicated to preserving the integrity of the marketplace and is committed to promoting a fair and competitive business environment in Colorado. Consumer protection is our mission.