SEC Charges a Florida Resident in Connection to $18.5 Million Securities Fraud Scheme
On July 24th, 2020, the Securities and Exchange Commission (SEC) announced securities fraud charges against Trustify Inc. and its founder Daniel K. Boice. Mr. Boice currently resides in Nassau County Florida. According to federal regulators, the company raised more than $18.5 million from at least 90 different corporate and individual investors on false pretenses. The SEC alleges that material misrepresentations were made to the public and the company’s founder misappropriated millions in investor funds.
Securities Fraud Charges: Trustify Inc. and Daniel K. Boice
Material Misrepresentations Were Made to Investors
In a complaint filed in the United States District Court for the Eastern District of Virginia, the SEC outlined its case that Trustify Inc. and its founder and Chief Executive Officer (CEO) Daniel K. Boice fraudulently raised more than $18.5 million from investors. The underlying misconduct at issue in this case occurred between 2015 and 2018. During that time, Mr. Boice allegedly made material misrepresentations and material omissions to investors in an attempt to sell securities in his company Trustify Inc.
As a business, Trustify Inc. operated an online marketplace that (purportedly) connected private investigators to potential customers. In its securities offerings, the SEC notes that Mr. Boice presented Trustify as a fast-growing startup company with many high-value corporate clients and a deep network of well-respected private investigators. Revenues were presented as growing. The agency contends that the reality was far different: The company’s revenue was quite modest, it had few customers, and many fewer private investigators than it presented.
Investor Fund Were Misappropriated
In late 2018, Trustify was forced to suspend most of its operations after experiencing severe cash flow problems. The company was unable to pay employees and vendors. The SEC contends that one of the primary issues was that Mr. Boice had misappropriated more than $8 million in investor capital to cover his personal expenses and fund his luxurious lifestyle. His former wife and his consulting company have been named as relief defendants. The SEC believes that investor funds were funneled through his wife and the other company.
SEC Brings Civil Charges, DOJ Brings Criminal Charges
In its civil lawsuit, the SEC is charging Daniel Boice and his company Trustify with securities fraud under federal law. The agency is seeking a permanent injunction, restitution for all affected investors, and disgorgement of ill-gotten profits. The Department of Justice (DOJ) is also filing criminal securities fraud charges against Mr. Boice. He is facing additional criminal charges for money laundering and wire fraud in Virginia.
Schedule a Confidential Consultation With an Investment Fraud Attorney
At Carlson & Associates, P.A., our Miami investment fraud lawyers fight to help our clients get money damages for their losses. If you or your loved one suffered losses in unregistered securities, we are ready to protect your rights. Contact us now for a confidential review of your legal claim. We represent investors in Miami-Dade County, Broward County, Palm Beach County, and throughout the entire region.
Resources:
sec.gov/news/press-release/2020-162
sec.gov/litigation/complaints/2020/comp-pr2020-162.pdf