An attorney from Alabama, Donald Watkins, and companies he controls are facing charges of defrauding professional athletes and other investors out of millions of dollars by falsely telling investors that their funds would be used to support waste to energy ventures.
According to the US Securities and Exchange Commission (SEC), its complaint, filed in federal district court in Atlanta, alleges that Watkins and his companies, Watkins Pencor LLC and Masada Resource Group LLC the complaint further alleges that the defendants falsely claimed that Waste Management Inc. (NYSE:WM) was seriously considering acquiring Watkins Pencor, Masada, and its affiliated companies in a multi-billion-dollar transaction.
However, Waste Management’s “interest” in Masada was said to have never advanced past a brief initial meeting in August 2012, more than a year after the defendants began telling investors that negotiations were progressing and that the acquisition was imminent.
The Commission explained that it is charging the defendants with violating the antifraud provisions of the federal securities laws and a related SEC antifraud rule.
The SEC’s complaint seeks permanent injunctions, penalties and return of allegedly ill-gotten gains with prejudgment interest.
The complaint alleges that Watkins’ law firm, Donald V. Watkins, P.C., received investor monies and charged the firm as a relief defendant for purposes of recovering the allegedly ill-gotten gains it received.
Unfortunately, much of those ill-gotten gains are thought to have been spent by Watkins on his girlfriend and to cover personal expenses such as alimony, past due taxes and credit card bills.
“We allege that Watkins duped investors into believing that there was a lucrative transaction on the horizon, when in fact there was none,” commented Walter Jospin, Regional Director of the SEC’s Atlanta Regional Office.
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