LITIGATION LAUNCH NO. 17422 / March 19, 2002
Securities and Exchange Commission v. ACE Payday Plus, LLC d/b/a ACE Payday Plus II, LLC, ACE Management, LLC, ACE Payday Management, Inc., and James Bianco, Case No. 1-02-20858-Civ. -Ungaro-Benages (S.D. Fla. March 19, 2002)
Today, the Commission filed a crisis enforcement action in the usa District Court when it comes to Southern District of Florida against ACE Payday Plus, LLC, d/b/a ACE Payday Plus II, LLC (“Ace Payday”), a start-up business purportedly offering “check cashing” and “payday advance” solutions; ACE Management, LLC and ACE Payday Management, Inc., two entities individually defined as Ace Payday’s Manager; and James Bianco (“Bianco”), whom managed Ace Payday and its particular affiliates. The Commission alleges that defendants raised at the least $800,000 from at the least 30 investors by fraudulently providing and attempting to sell account devices in Ace Payday through telemarketers called “independent product product sales offices” or “ISOs. ” The Complaint alleges that defendants told investors that 90% of this providing profits could be utilized to develop Ace Payday’s company when, in reality, 40% to 45per cent went along to the ISOs as product product sales commissions. The Complaint additionally alleges that defendants lured investors by guaranteeing investment that is excessive and also by baselessly projecting extremely positive earnings all the way to 720percent each year. In the Commission’s movement, the court issued an purchase temporarily restraining defendants from breaking the antifraud and enrollment conditions associated with federal securities laws and regulations, freezing defendants’ assets, and giving other crisis relief. A hearing from the Commission’s movement for the injunction that is preliminary planned for April 5, 2002.
The Complaint names as defendants:
Ace Payday, a Florida liability that is limited headquartered in North Miami Beach, Florida.
Bianco, a resident of North Miami Beach, Florida, therefore the executive that is chief of Payday, Ace Management, LLC, and Ace Payday Management, Inc.
Ace Management, LLC, identified within the providing materials as being a Florida liability that is limited, Ace Payday’s “Manager, ” and “a specialist pay day loan and always check cashing Management Co. “
Ace Payday Management, Inc., a Florida firm identified on Ace Payday’s Florida state filings as the LLC supervisor for Ace Payday.
The Complaint alleges that:
Defendants have actually carried out the providing by way of different written materials, that they provided for investors that are prospective the direction for the ISOs.
During these materials, defendants describe Ace Payday as being a start-up business in the industry of providing “retail pay day loan” and “check cashing” services, declare that check cashing is possibly ” the quickest growing industry in the us today, ” and encourage investors to “take advantageous asset of playing this profitable industry. ” Defendants task that the business’s cash advance operations will produce “the average of as much as 360% profit per 12 months” and that the business’s check cashing operations will create “up to 720percent per 12 months. ” they feature cash central investors (a) interest during the price of 20% per year become compensated at a level of 5% each quarter for 36 months, and (b) a pro-rata share associated with the business’s profits. In reality, between 40% and 45% associated with offering profits have already been utilized to pay the ISO’s, which behave as unregistered agents soliciting investors that are unsophisticated. Defendants do not have foundation for guaranteeing 20% interest payable quarterly or projecting such positive profits – particularly now, as Ace Payday currently has did not satisfy its quarterly responsibilities to investors.
The Commission’s problem charges every one of the defendants with breaking the antifraud and enrollment conditions regarding the federal securities rules, specifically Sections 5(a), 5(c) and 17(a) associated with the Securities Act of 1933, Section 10(b) of this Securities Exchange Act of 1934, and Rule 10b-5 thereunder. Aside from the emergency relief described above, the Complaint seeks permanent injunctions prohibiting future violations associated with securities legislation, disgorgement, and civil charges.