On June 23, 2010, the Securities and Exchange Commission filed fraud and other charges in connection with three Ponzi schemes that targeted members of the Mormon community. The SEC’s complaint alleges that the defendants raised at least $3.6 million by convincing at least 36 investors to invest in two companies, Zufelt, Inc. and Silver Leaf Investments, Inc.
According to the SEC’s press release, the complaint alleges that Zufelt and Nelson promised investment returns of up to 220% and fraudulently claimed that Zufelt ran a profitable credit card transaction processing business that was selling secure investments backed by a so-called “merchant portfolio” of credit card processing accounts.
Significantly, the complaint alleges that the named defendants solicited members of the Mormon community to invest in these schemes, and that they encouraged potential investors to borrow against their homes in order to invest. Unfortunately, this is a common refrain.
Click HERE to view the SEC’s Complaint.
NOTE: This filing does not appear to relate to the case against a similarly-named company called “Silverleaf” that was filed by the Utah Division of Securities in March, and is discussed here. That case has been resolved.