The Securities and Exchange Commission (SEC) Enforcement Division has charged Alan Heide with defrauding retail investors. Heide was the former CFO of 1 Global Capital – a merchant cash advance platform (MCA). 1 Global is now bankrupt and former principles Carl Ruderman and Henry J. “Trae” Wieniewitz, have already been charged with fraud. The SEC notes these two former executives have consented to final judgements.
Heide is now being pursued by the SEC and according to the complaint:
“1 Global promised investors profits from its short-term cash advances to businesses, the company used substantial investor funds for other purposes, including paying operating expenses and funding Ruderman’s lavish lifestyle. The SEC alleges that Heide, a certified public accountant, for nine months regularly signed investors’ monthly account statements that he knew overstated the value of their accounts and falsely represented that 1 Global had an independent auditor that had endorsed the company’s method of calculating investor returns.”
The SEC claims that 1 Global raised over $322 million from 3600 investors from 2014 until 2018.
Although 1 Global claimed to only provide access to qualified investors, the SEC alleges this was not the case as the company never checked accreditation status and a stated $25,000 minimum was ignored.
The SEC states that 1 Global’s marketing materials touted the investment as a safe and less risky alternative to traditional stock market investments, and “routinely promised investors annual returns in the high single to low double digits.”
Potentially defrauded investors may learn more about the case here.