The Securities and Exchange Commission has charged Knight Nguyen Investments, a Katy, Texas-based investment adviser, its majority owner, Chris Lopez and two others with investing money from clients and retail investors in at least five fraudulent securities offerings.
The SEC alleges that Chris Lopez and representative Forrest Jones claimed the firm had an expertise in low-risk alternative investments and invested only in "proven" companies. In fact, the SEC charges, Lopez had no experience as a securities professional before forming Knight Nguyen and the firm had little or no experience with alternative investments.
The firm invested the money it raised in high-risk securities issued by companies that did not meet its investment criteria and were in fact owned or controlled by Chris Lopez or his brother. Jayson Lopez., the SEC said in a release.
Knight Nguyen raised at least $3.7 million from about 70 clients and retail investors between March 2016 and September 2018. The SEC also alleges that Jayson Lopez aided and abetted the fraud by misusing investor funds and helping fabricate false financial statements and other documents.
The financial advice industry has been facing inquiries into its cash sweep programs for years now.
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