U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 19764 / July 17, 2006
Securities and Exchange Commission v. Renaissance Asset Fund, Inc., Ronald J. Nadel, and Joseph M. Malone, Civil Action No. SA CV 06-661-JVS (C.D. California)
The Commission filed civil fraud charges today against Renaissance Asset Fund, Inc., Ronald J. Nadel, and Joseph M. Malone. The Commission's complaint, filed in the United States District Court for the Central District of California, alleges that Renaissance and its principals raised over $16 million from more than 190 investors nationwide. Many of the victims were elderly and were solicited through Jehovah's Witnesses congregations.
According to the complaint, from at least March 1999 through April 2004, the defendants raised funds for multiple purported projects, including a general fund, an outlet mall, an international currency exchange, and a Swiss bank. Some of the purported projects did not exist, and others were unsuccessful. The defendants misrepresented to investors that their investments would earn returns ranging from 10% to 25% in as little as four months. The defendants also sent quarterly account statements to investors setting forth the fictitious profits their investments had purportedly earned. Based on the representations in these account statements, many investors reinvested their principal and purported profits in other Renaissance projects.
The defendants operated Renaissance's programs as a Ponzi scheme, paying earlier investors with funds raised from later investors. Nadel also used investor funds to pay for lavish expenses, including country club memberships, car leases, and retail purchases. The majority of investors in Renaissance never received the interest or return of their principal the defendants had promised.
Based on this conduct, the complaint alleges that Defendants Renaissance, Nadel and Malone violated Section 17(a) of the Securities Act of 1933 (Securities Act) and Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint also alleges that Nadel and Malone violated Section 15(a) of the Exchange Act. The complaint seeks final judgments permanently enjoining the defendants from violating or aiding and abetting violations of the antifraud and registration provisions of the federal securities laws. The Commission also seeks disgorgement of ill-gotten gains with prejudgment interest, an accounting, and civil penalties.
In related SEC proceedings, Senior Resources Asset Fund LLC and Kenneth Baum have consented to the issuance of cease-and-desist orders for their role in selling Renaissance investments. The Commission ordered both Senior Resources and Baum to cease and desist from selling unregistered securities, and ordered Baum to cease and desist from acting as an unregistered broker-dealer. Senior Resources and Baum consented to the issuance of the order without admitting or denying its findings. For further information, see Securities Act Release No. 33-8723 (July 17, 2006).
SEC Complaint in this matter
S.E.C. Sues Jehovah's Witnesses For Investment Frauds
U.S. SECURITIES AND EXCHANGE COMMISSION
Great catch! Thank you!
Sues "individual JWs" but not the WTS............
I dont think they are going after the society. It looks like a witness was selling to other witnesses.
Don't miss reading the S.E.C.'s full complaint at:
Nadel's and Malone's JW activities are briefly mentioned on pages #2 and #13.
BTW, Nadel and Malone are/were "Jehovah's Witnesses". If the WBTS had been involved, I would have entitled the post "S.E.C. Sues WBTS For Investment Frauds".
Sounds like the Ron Nadel that I knew pretty well in the late 70's. For quite awhile he was in the music promotion biz and had an office next to Larry Graham's home/studio in North Hollywood.
Again, if this is the same Ron Nadel - he also formed a corporation with Wayne Henderson (Jazz Crusaders) called "Apples of Gold" (in silver carvings - based on scripture from Proverbs)and was going to represent Larry, Wayne and other acts. That corp folded long ago, and if I recall correctly the whole deal did not end well.
Ron used to get parts on almost every circuit assembly. Rumor was he regularly slipped big money in the pockets of the CO and DO.
If the suit proves to be warranted - it would not surprise me in the least.
Thanks for finding that.
from this site - he is listed as on A&M records staff:
Kelly Konzelman yields even more google hits fwiw.
Before I go nuts:
A & M Records:
I've seen more "brothers" screw the others in the congregation with "business deals."
This really is an excellent find. Sad to say, this information will never see the light of day in the congregations. If this was a matter with the Catholic church, then you would see this printed in the next "Watchtower" or "Awake" magazines.
On the google news wire for all to see SEC busts Calif. Ponzi scheme
InvestmentNews, NY - 2 hours ago
... personal expenses. Many of the victims were elderly and were solicited through Jehovah's Witnesses congregations. The complaint ... SEC busts Calif. Ponzi scheme By Aaron Siegel [email protected] July 18, 2006 The Securities and Exchange Commission filed an action yesterday charged San Clemente- Calif.-based Renaissance Asset Fund Inc.; its president, owner and manager Ronald J. Nadel and head of investor relations, Joseph M. Malone, with fraudulently raising $16 million from more than 190 investors nationwide.According to the complaint, the fund and its principals operated a Ponzi scheme, using investor funds to pay lavish personal expenses. The complaint was filed in the United States District Court for the Central District of California in California in Orange County,
Many of the victims were elderly and were solicited through Jehovah's Witnesses congregations.
The complaint alleges that Mr. Nadel and Mr. Malone raised funds for several purported projects - some of which did not exist and others that were unsuccessful - including a general fund, an outlet mall, an international currency exchange and a Swiss bank.
The complaint also states that the defendants misrepresented to investors that their investments would earn returns ranging from 10% to 25% in as little as four months.
The majority of investors in Renaissance never received the interest or return of their principal the defendants had promised.
At the time that the regulator filed the injunctive action, it settled administrative cease-and-desist proceedings against Eanad Point, Calif-based Senior Resources Asset Fund LLC and Kenneth E. Baum based on their conduct in selling Renaissance investments to seniors.
The SEC alleged that the firm issued unregistered securities in the form of promissory notes, bearing interest at rates ranging from 10% to 15% per year, and to mature two years from the date of issuance.
Mr. Baum was said to have offered Senior Resources notes and other unregistered securities to at least 28 investors and received transaction-based compensation in connection with his sales.
"The filing of these actions reflects the Commission's determination to protect seniors and other investors from securities fraud by those who would prey upon their vulnerabilities and group affiliations," said SEC Enforcement Division Director Linda Chatman Thomsen, in a statement.