SEC Says Utah Man Ran ‘Ponzi-Like’ Scheme

SALT LAKE CITY (CN) - Brian Smart and Smart Assets have been operating a "Ponzi-like scheme," bilking customers for $1.7 million since 2003, the Securities and Exchange Commission claims in Federal Court.

The SEC claims Smart solicited investors, most of them elderly, from acquaintances and clients he met through the AIM Association, an insurance company in Anaheim, Calif.

Despite being fired in 2004, Smart continued to represent himself as part of AIM, the SEC claims. He allegedly told investors he was setting up offices for AIM in Utah.

According to the lawsuit, Smart went to great lengths to convince investors that he was legitimate in a three-stage scheme. He allegedly used investors' money to fund ill-fated real estate ventures, and issued fake stock certificates and promissory notes to customers in his "hard lending" program. The SEC says he offered at least one investor a $3,000 return per month on a $500,000 investment.

Instead of investing the money, the SEC says Smart used it to live off and buy a home in Utah, among other things.

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