Texas man raked in more than $3.45M from alleged scheme
A Texas man who allegedly solicited $3.45 million from more than 7,000 deaf investors before securities regulators stopped him last year has been charged with fraud.
The Securities and Exchange Commission alleges that Jody Dunn, who is deaf himself, told people he would invest their money with Imperia Invest IBC, an Internet-based firm that said it guaranteed returns of 1.2% a day. The commission charged Imperia with fraud in October and obtained a court order to freeze the investment firm's assets after it had raised a total of $7 million, including $4 million from deaf investors.
Mr. Dunn spent a portion of investors' money to pay his mortgage, car bills and other personal expenses, and sent the rest to Imperia's offshore accounts, the SEC said in its complaint, filed in a federal court in Plano, Texas. Investors were never paid interest after giving funds to Mr. Dunn, who was aware that Imperia lost investor money and that it wasn't accurately crediting investor accounts, the SEC said.
“To further take advantage of others in the deaf community, Dunn was siphoning off about 10% of the money he collected from investors to pay his own bills before sending the rest of the money into the Imperia quagmire,” said Kenneth Israel, director of the SEC's Salt Lake City regional office.
Imperia purported to invest in traded-endowment policies, which are British viatical settlements that involve the sale of insurance policies before those policies mature. No investor funds were ever used to buy TEPs, the SEC said.
Mr. Dunn could not immediately be reached for comment and is acting as his own lawyer in this matter, according to the SEC.
While soliciting investments for Imperia from August 2007 through July 2010, Mr. Dunn did not try to verify that Imperia actually invested the money, the SEC alleged in the complaint. He also told investors that he knew individuals behind Imperia, which said it was located in the Bahamas, but he actually never met anyone from the investment firm, according to the SEC complaint.
