Search This Blog


This is a photo of the National Register of Historic Places listing with reference number 7000063

Thursday, August 7, 2014

SEC CHARGES SHI SHAILENDRA WITH DEFRAUDING INVESTORS

FROM:  U.S. SECURITIES AND EXCHANGE COMMISSION 

SEC Charges M. "Shi" Shailendra with Defrauding Investors

On July 31, 2014, the Securities and Exchange Commission charged M. “Shi” Shailendra with making false representations to investors, misappropriating money, and acting as an unregistered broker. 

According to the SEC’s complaint filed in the U.S. District Court for the Northern District of Georgia, Shailendra solicited investments and sold securities in Interstate North 5 Acres, LLC f/k/a Shi Investments Six, LLC (“Shi Six”) through oral and written misrepresentations.  Shailendra touted Shi Six as a real estate investment vehicle that would invest in newly acquired distressed real estate.  Among other things, Shailendra failed to fund his equity interests in the limited liability company but nonetheless allocated ownership to himself as if he had done so, misappropriated investor cash for himself, and used investor money to support his pre-existing, affiliated deals. 

Without admitting or denying the SEC’s allegations, Shailendra agreed to settle the case.  The settlement is pending final approval by the court.  Specifically, Shailendra consented to the entry of a final judgment (1) permanently enjoining him from future violations of Section 17(a) of the Securities Act of 1933 (the “Securities Act”) and Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 thereunder; (2) permanently enjoining him from participating in the issuance, purchase, offer, or sale of any security, including, but not limited to, engaging in activities for purposes of inducing or attempting to induce the purchase or sale of any security; (3) finding him liable for disgorgement of $2,086,0935, the amount of his ill-gotten gains, plus prejudgment interest of $443,359, but waiving that amount and not ordering a monetary penalty based on Shailendra’s inability to pay; (4) ordering Shailendra to relinquish any purported claims he has in or against Shi Six; and (5) requiring him to resign as Manager of Shi Six. 

As part of the settlement, and following the entry of the proposed final judgment, Shailendra, without admitting or denying the Commission’s findings, has consented to the entry of a Commission order, pursuant to Exchange Act Section 15(b)(6), permanently barring him from association with any broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or nationally recognized statistical rating organization, or from participating in any offering of a penny stock.

The SEC’s investigation was conducted by Corey A. Schuster, Donato Furlano, and Charles D. Stodghill, and was supervised by Amy L. Friedman and Scott W. Friestad.  The SEC appreciates the assistance of the Department of the Treasury’s Office of Inspector General.


No comments:

Post a Comment

a href="http://gan.doubleclick.net/gan_click?lid=41000613802101859&pubid=21000000000397724">Furniture Event - Save up to 50% at officemax.com