A federal court has imposed an asset freeze against a Framingham man and several Massachusetts-based investment advisory companies he headed based on charges that he misappropriated at least $16 million from an investment fund, the Securities and Exchange Commission (SEC) said.
According to a statement from the SEC, Judge Nathaniel Gordon of the U.S. District Court for the District of Massachusetts granted the agency’s request for an emergency court order to freeze the assets of Daniel Thibeault and several investment advisory firms he owned or controlled.
Additionally, the court also ordered certain preliminary relief against the defendants, including, preliminary injunctions, an accounting of investor funds and all assets in their possession, a repatriation of all foreign assets that were obtained directly or indirectly from investors and a prohibition from soliciting or accepting additional investments.
According to the SEC’s complaint, Thibeault and one of his firms, GL Capital Partners, served as the investment advisers to a fund named the GL Beyond Income Fund, whose assets were largely comprised of individual variable rate consumer loans. Thibeault solicited investors by telling them their money would be pooled and used to make or purchase consumer loans, which would then provide them with returns as consumers paid down the loans.
Instead, Thibeault and other defendants created fake loans to divert investor money from the fund and reported those phony loans as assets of the GL Beyond Income Fund, and furthermore, forged paperwork using the names and personal information of people who did not know loans were being made in their names, the SEC charged.
The purported borrowers did not receive any money; instead Thibeault and others used it for personal expenses, the SEC said.
Thibeault is charged with violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and Section 17(a) of the Securities Act of 1933 and Thibeault, GL Capital Partners LLC and GL Investment Services LLC with violating Sections 206(1) and 206(2) of the Investment Advisers Act of 1940.
