The SEC filed an injunction against Coadum Advisors, Inc., Mansell Capital Partners III, LLC, James A. Jeffery, Thomas E. Repke, Coadum Capital Fund 1, LLC, Coadum Capital Fund II, LP, Coadum Capital Fund III, LP and Mansell Acquisition Company LP alleging that the persons and entities engaged in fraud in conjunction with a series of four securities offerings which began in early 2006. Jeffery and Repke controlled the entities and directed the offerings. The complaint further alleged that, as a result of the fraudulent scheme, approximately $30 million was raised from at least 150 investors. The SEC alleged that the persons and entities:

  • falsely represented to investors that they would receive a return of from 3 to 6% per month;
  • misrepresented that their principal was protected; and
  • failed to disclose that the defendants have made loans to themselves from the investor proceeds.

Furthermore, the complaint alleged that the defendants falsely represented in monthly account statements to investors that they have earned approximately 4% per month, and that all or most of their principal was in escrow. Finally, the complaint alleged that, without disclosure to investors, Coadum and Mansell had also "borrowed" in excess of $3 million of, or against, the investors' funds and had disbursed approximately $5 million to related parties.

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