SEC Charges Missouri Man and F3 Mastermind With Defrauding Investors in Three Securities Offerings
The U.S. Securities and Exchange Commission filed a litigated action charging Robert M. Thompson and a private entity he controls, Financial Freedom Foundation d/b/a/ F3 Mastermind, with defrauding investors in three securities offerings.
According to the SEC’s complaint, since at least early 2019, Thompson has marketed F3 Mastermind as a private membership group for investors seeking passive investment income. In the alleged scheme, after paying an initial and then monthly fee, members were offered investments in trading programs run by third-party operators that claimed to generate risk-free returns ranging from 20% per week to 4,000% per year. As alleged, between early 2019 and mid-2022, Thompson and F3 Mastermind recommended these investments to at least five investors located in Missouri, Kentucky, and California who subsequently invested in these programs.
The complaint further alleges that Thompson, a resident of Reeds Spring, Mo., and F3 Mastermind falsely stated that these programs were real and provided extraordinary investment returns with little or no risk. As alleged, F3 Mastermind members invested in these “prime bank”-like schemes and collectively provided at least $2 million to the third-party operators who conducted the schemes. Prime bank schemes often claim that investments are secretive or exclusive and use vague or complex terms and structures to obscure the source of the phenomenal returns promised to investors.
Finally, the complaint also alleges that relief defendant Brian K. Stucki received ill-gotten gains from the scheme to which he has no legitimate claim.
The SEC’s complaint, filed in federal court in Missouri, charges Thompson and F3 Mastermind with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Section 206(1) and (2) of the Investment Advisers Act of 1940, and Thompson with acting as a control person of F3 Mastermind pursuant to Section 20(a) of the Exchange Act. The SEC seeks injunctive relief, disgorgement with prejudgment interest, and a civil penalty against Thompson and F3 Mastermind; disgorgement with prejudgment interest against Stucki; and a bar against Thompson serving as an officer or director of a public company.
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