SEC Freezes $9 Million in Assets

MANHATTAN (CN) - The SEC obtained an emergency order freezing the assets of two people and three companies the agency accuses of stealing $9 million from investors.
     The emergency court order freezes the assets of Lawrence E. Penn III and his firm Camelot Acquisitions Secondary Opportunities Management, the SEC said in a statement.
     Also sued, and money put on ice, Michael St. Altura Ewers, Camelot Group International, and Ssecurion LLC, the SEC said. Named as relief defendant was A Bighouse Photography and Film Studio LLC, which is owned by Ewers.
     "Penn and his longtime acquaintance Altura S. Ewers concocted a sham due diligence arrangement where Penn used fund assets to pay fake fees to a front company controlled by Ewers," the SEC said in a statement announcing its federal lawsuit.
     "Instead of conducting any due diligence in connection with potential investments by Penn's fund, Ewers' company Ssecurion promptly kicked the money back to companies and accounts controlled by Penn so he could secretly spend investor funds for other purposes. For example, Penn paid hefty commissions to third parties to secure investments from pension funds. Penn also rented luxury office space and used the funds to project the false image that Camelot was a thriving international private equity operation," the SEC said in the statement.
     Penn started his Camelot Acquisitions Secondary Opportunities LP in 2010, and "secured capital commitments of approximately $120 million," the SEC said.
     It claims that Penn diverted $9.3 million of investors' assets to Ssecurion.
     "With the assistance of Ewers, who lives in San Francisco, Penn repeatedly misled the fund's auditors about the nature and purpose of the due diligence fees," the SEC said. "(T)he scam began to unravel in 2013 when Camelot's auditors became increasingly skeptical about the fees. In their haste to cover their tracks, Penn and Ewers brazenly lied to the auditors and forged documents as recently as July 2013, pretending the files were generated by Ssecurion."
     The SEC seeks disgorgement, fines, and wants the defendants ordered never to do it again. Or anything like it again. Nothing illegal, that is.