The Securities and Exchange Commission announced that it had charged a South Florida man and his company in an alleged fradulent investment scheme.
The SEC said that from at least October 2023 through August 2024, CMI Capital LLC and its founder and manager, Michael D. Williams, raised approximately $860,000 from at least 18 investors, many of whom are current or retired law enforcement officers in South Florida.
According to the SEC’s complaint, Williams made numerous false and misleading statements in order to convince clients to invest in two funds that he controlled. The investors were allegedly told that one of the funds had a portfolio value of more than $5 million and achieved returns exceeding 140 percent. Many of the investors were reported to have trusted Williams because he worked for a third-party police and firefighter pension plan administrator.
“We allege that one of the tactics the defendants used to trick investors was to send them cropped screenshots of graphics that showed exorbitant trading profits,” said Stephanie N. Moot, Director of the SEC’s Miami Regional Office. “We strongly urge all investors to use caution when entrusting their funds to others and to be wary of anyone promising high returns with little to no risk.”
Williams allegedly misappropriated approximately $384,000 of investor and client funds to pay for personal expenses, including credit card balances, a sports car, and vacations. The SEC’s complaint, filed in the U.S. District Court for the Southern District of Florida, states that Williams began repaying certain investors in August 2024 and has repaid more than $375,000 to certain investors.
Williams and CMI Capital, which is also known to do business as Check Mate Investments, were charged with violating antifraud and registration provisions of the Securities Act of 1933 and antifraud provisions of the Securities Exchange Act of 1934 and Investment Advisers Act of 1940.
The defendants did not admit the allegations but consented to the entry of judgments that would permanently enjoin them from violating the charged provisions of the federal securities laws and further enjoin Williams from participating in the issuance, purchase, offer, or sale of any security except for certain transactions in his personal accounts.
The proposed judgments, subject to court approval, further provide that the court shall order disgorgement with prejudgment interest against Williams and civil penalties against the defendants in amounts to be determined by the court. Williams also agreed to a forthcoming associational bar against him.
The attorneys at Hyman Cotter have decades of experience dealing with securities fraud cases and have a deep understanding of how capital markets and financial service firms are intended to work to protect investors. If you think your financial professional or firm engaged in misconduct that caused you investment losses, contact Hyman Cotter at (833) 665-0784 or through our online contact form for a no-cost evaluation of your matter.
