August 14, 2020

Volume X, Number 227

August 14, 2020

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il Grande Vecchio Would Be Mortified - Fraudsters Use Digital Asset Scam to Buy a Ferrari

Enzo Ferrari, the founder of Scuderia Ferrari Grand Prix motor racing team and the Ferrari motor company, would be mortified to know that a group of fraudsters used a digital asset scam to buy one of the masterpieces of engineering produced by his company.

The Securities and Exchange Commission recently obtained an order freezing the assets of a former state senator and two other fraudsters who bilked investors in and outside the U.S. The SEC alleges Robert Dunlap and Nicole Bowdler worked with former Washington state senator David Schmidt to market and sell a purported digital asset called the “Meta 1 Coin” in an unregistered securities offering. The defendants made false and misleading statements that the Meta 1 Coin was backed by a $1 billion art collection or $2 billion of gold, and that an accounting firm was auditing the gold. The defendants also told investors that the Meta 1 Coin was risk-free, would never lose value and could return up to 224,923%. The defendants never distributed the Meta 1 Coins and used investor funds to pay personal expenses and funnel proceeds to two others parties. Some of the investor funds were used to buy luxury automobiles, including a Ferrari. The defendants raised more than $4.3 million from more than 150 investors. The SEC alleges Meta 1 Coin Trust, Dunlap, Bowdler, and Schmidt with violated the antifraud and securities registration provisions of the federal securities laws.

A copy of the SEC complaint can be found here.

© Polsinelli PC, Polsinelli LLP in CaliforniaNational Law Review, Volume X, Number 99

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About this Author

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Richard Levin brings his experience as a senior legal and compliance officer on Wall Street and in London to bear in advising clients on corporate, securities and regulatory issues. A problem-solver by nature, his practice focuses on helping financial services and technology (FinTech) clients identify and address regulatory issues as they build their businesses.  

The FinTech sector is experiencing rapid changes that are producing innovative new technologies: digital currencies, blockchain technology, peer to peer lending, robo advisors, crowdfunding portals, and...

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Paul Roshka, Polsinelli, financial securities lawyer
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Known for his thorough preparation and persistence, Paul Roshka has a national practice representing companies, their directors, officers, and employees during investigations and enforcement/disciplinary proceedings involving potential violations of the federal and state securities laws, and other financial regulatory statutes and rules. He has handled matters initiated by almost every SEC Regional Office and FINRA District Office, and their Home Offices in Washington, D.C.

He is also a recognized bet-the-company litigator. Paul has defended securities/financial claims in federal and state court, including class action defense. He is a seasoned litigator trusted to resolve our clients’ disputes. Paul and the lawyers he supervises know it is important to keep clients informed, and provide value for the services they render. He handles arbitrations and mediations nationwide. He also serves as a mediator in securities and complex matters involving real estate and other financial claims.

Paul’s passion for resolving complex disputes is equally matched by his passion for positively impacting his community. He has spearheaded numerous significant charitable efforts that have directly and positively impacted the lives of thousands of Arizona children and families. He is a Chairman Emeritus of Phoenix Children’s Hospital, a Past Chairman of the Hospital’s Foundation, Past Chairman of the Children’s Cancer Center and Past Chairman of Phoenix Suns Charities. Paul has served on the Boards of the Salvation Army and Xavier College Preparatory School.  Paul is currently on the Board of Southwest Human Development, an organization that seeks to create a positive future for every child. 

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Jason A. Nagi, Polsinelli, Distressed note purchases lawyer, Real estate matters attorney
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Jason Nagi helps clients find the most efficient route to their desired result and clients have relied on him to get them what they need – in and out of the courtroom – for more than a decade.

He has significant experience representing parties involved in the following matters:

  • Foreclosing lenders realizing on their collateral

  • Distressed note purchases

  • Real estate

  • Related bankruptcy and out-of-court...

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