KNOXVILLE, Tenn. (WVLT) - A Knoxville financial planner is facing federal charges in connection to a $1.2 billion Ponzi scheme.
According to a complaint from the U.S. Securities and Exchange Commission Henry "Trae" Wieniewitz and Wieniewitz Financial sold stocks and bonds (securities) in two companies called 1 Global LLC. and Woodbridge LLC. without proper registration.
1 Global and Woodbridge, both of which are bankrupt companies, are under a continuing investigation for operating as Ponzi schemes.
The SEC is seeking a court order for Trae Wieniewitz to pay back "ill-gotten gains" he earned through illegal operations which the filing says amounts to more than $3 million.
In a previously filed lawsuit investors claimed Wieniewitz illegally recommended investing in unregistered promissory notes issued by 1 Global Capital, LLCand/or 1st West Capital, LLC.
The Wolper Law Firm, which is representing the group of investors who collectively invested $1,783,373, said Wieniewitz represented notes issued by 1 Global Capital, LLC as short-term and low-risk investments “guaranteed” to return 7%-9% and likely much higher. The firm said the elderly and those nearing retirement age made up most of the investors.
According to the firm, Wieniewitz was paid a sales commission of $932,000 by acting as a sales agent for notes issued by 1 Global Global Capital, LLC.
The Wolper Law Firm alleges that Wieniewitz never disclosed 1 Global Global Capital, LLC was under investigation for securities fraud.
He's also accused of convincing people to invest during all expenses paid dinners at Ruth's Chris. According to the law firm, Wieniewitz likened notes issued by 1 Global Global Capital, LLC to business giants Amazon and PayPal.
WVLT News reached out to Trae Wieniewitz for comment but received no response.
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