SEC Obtains Asset Freeze Against California Couple to Stop Alleged Investment Fraud
The Securities and Exchange Commission has obtained an emergency court order freezing assets of a San Juan Capistrano, California-based company and its founder, who allegedly were carrying out an ongoing investment fraud.
The Securities and Exchange Commission has obtained an emergency court order freezing assets of a San Juan Capistrano, California-based company and its founder, who allegedly were carrying out an ongoing investment fraud.
According to the SEC’s complaint, Justin Robert King and his company, Elevate Investments LLC, raised about $7.4 million from investors since at least June 2019. The complaint alleges that King and Elevate were offering interests in the Elevate Investment Fund despite the fact that no such fund entity exists.
The complaint further alleges that all investor money was held in brokerage and bank accounts in the name of King, his wife, and/or Elevate.
The SEC claims that Elevate’s website stated that King’s trading resulted in returns of 61 percent for all his clients’ accounts from June 2019 through June 2020. However, according to the SEC’s complaint, he actually incurred losses of $3.8 million during that period.
In addition, Elevate’s website purportedly listed certain “trusted providers,” including broker-dealers TD Ameritrade and Interactive Brokers. The SEC alleges that TD Ameritrade closed King’s and Elevate’s accounts in July and August 2020, respectively, and King and Elevate never had any accounts at Interactive Brokers.
From September 2020 to December 1, 2020, King allegedly transferred almost $400,000 from the brokerage accounts to the bank account of his wife, who is named in the complaint as a relief defendant.
On December 28, 2020, a California district court granted the SEC’s request for a temporary restraining order against King and Elevate. The court’s order freezes the assets of King, Elevate, and Shannon King, appoints a temporary receiver over Elevate, and orders King, Elevate, and Shannon King to provide an accounting, among other relief.
The court set a hearing on the SEC’s motion for a preliminary injunction extending the emergency relief through the conclusion of the case for January 11, 2021.
