SEC v. IU Group, Inc.; Elijah Bang; Elijah Bhang; and Daniel Lee, No. LR-21947, Central District of California (Apr. 25, 2011) — Press Release
raw: IU Group, Inc., Elijah Bang (a/k/a Elijah Bhang), and Daniel Lee
IU Group, Inc., Elijah Bang (a/k/a Elijah Bhang), and Daniel Lee, No. LR-21947 (Apr. 25, 2011)
Elijah Bang and Daniel Lee of IU Group, Inc. were halted by the SEC for operating a fraudulent Beverly Hills hedge fund and wealth management business, making false claims of $800 million under management and a successful performance history since 2007.
IU Group, Inc., its principal Elijah Bang, and salesperson Daniel Lee allegedly operated a fraudulent hedge fund and wealth management scheme targeting retirees, professors, and Christian communities. The defendants made false claims of $800 million under management and a successful performance history since 2007. The SEC charged them with violating registration and antifraud provisions, and Bang was also charged with investment adviser antifraud provisions.
The U.S. Securities and Exchange Commission (SEC) halted operations of IU Group, Inc., its principal Elijah Bang, and salesperson Daniel Lee, who allegedly ran a fraudulent Beverly Hills-based hedge fund and wealth management scheme targeting retirees, professors, and Christian communities. The defendants made false claims, including that the fund had operated since 2007 with $800 million under management and served high-profile clients, despite having no registered clients, no legitimate business operations, and no SEC or state registration. Bang and Lee used multiple fake entities, such as IU Wealth Management and Icon Capital Management, and cold-email solicitations to defraud potential investors. The SEC charged them with violating Sections 5(c) and 17(a) of the Securities Act of 1933 and, against Bang alone, antifraud provisions of the Investment Advisers Act of 1940. The court granted emergency relief, enjoining the defendants from further violations, with a preliminary injunction hearing scheduled for May 6, 2011. Prior to the SEC's action, California's Department of Corporations had ordered IU Investments LLC, Bang, and Lee to desist and refrain from the unlawful offer or sale of securities in 2009.
Exhibits & Attached Documents (1)
Extracted insights
- $800.00M $800 million $100M–$1B
- agency Securities and Exchange Commission
- organization Securities and Exchange Commission
- Securities and Exchange Commission obtained an emergency court order to shut down a Beverly Hills, Calif. hedge fund and wealth management business targeting retirees, universities
- IU Group, Inc., Elijah Bang (a/k/a Elijah Bhang), and Daniel Lee were charged with fraudulent activities in a Beverly Hills hedge fund and wealth management business
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 21947 / April 25, 2011 Securities and Exchange Commission v. IU Group, Inc., Elijah Bang (a/k/a Elijah Bhang), and Daniel Lee, Civil Action No. CV 11-00556-MMM (AJWx) (C.D. Cal.) SEC HALTS FRAUDULENT BEVERLY HILLS HEDGE FUND AND WEALTH MANAGEMENT BUSINESS On April 22, 2011, the Securities and Exchange Commission obtained an emergency court order to shut down a Beverly Hills, Calif. hedge fund and wealth management business targeting retirees, university professors, and members of the Christian community. The SEC alleges that IU Group Inc., its principal Elijah Bang, and its salesperson Daniel Lee targeted retirees and claimed on websites to have been founded by "devoted Christians who believe in God, Jesus Christ, and the Holy Spirit." Lee allegedly also sent "cold call" e-mail solicitations to university professors. It appears that IU Group was unsuccessful in obtaining any hedge fund investors or wealth management clients before the SEC's emergency action halted its operations. According to the SEC's complaint filed in federal court in Los Angeles, Bang and Lee made numerous false representations to potential investors and wealth management clients, including the following statements: The hedge fund was operational and had a successful performance history since January 2007. The majority of IU Wealth's clients are professional athletes, actors, producers, doctors, professors, politicians, and executives of private corporations. IU Wealth has over $800 million under management. The SEC alleges that Bang and Lee solicited potential investors and wealth management clients using various company names and websites, including IU Wealth Management, LLC and Icon Capital Management LLC. Lee also tried to find potential investors and clients using "cold call" e-mail solicitations. According to the SEC's complaint, IU Group and IU Wealth are not registered with the SEC. IU Group's business license was suspended by the State of California, and IU Wealth and Icon Capital are not companies of record in California. These entities have a mailing address in Beverly Hills, Calif., and Bang is believed to be a California resident. On May 19, 2009, California's Department of Corporations ordered IU Investments LLC, Bang, and Lee to desist and refrain from the unlawful offer or sale of securities and from the fraudulent sale of securities. The SEC's complaint charges all defendants with violations of the registration and antifraud provisions of Sections 5(c) and 17(a) of the Securities Act of 1933. The complaint also charges defendant Bang with violations of the investment adviser antifraud provisions of Sections 206(1), 206(2), and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder. The Honorable Margaret M. Morrow, U.S. District Judge for the Central District of California, granted the SEC's request for emergency relief for investors, including an order temporarily enjoining defendants IU Group and Bang from future violations of the antifraud provisions. A hearing on whether a preliminary injunction should be issued against the defendants IU Group and Bang is scheduled for May 6, 2011, at 10:00 a.m. PT. SEC Complaint in this matter
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 21947 / April 25, 2011 Securities and Exchange Commission v. IU Group, Inc., Elijah Bang (a/k/a Elijah Bhang), and Daniel Lee, Civil Action No. CV 11-00556-MMM (AJWx) (C.D. Cal.) SEC HALTS FRAUDULENT BEVERLY HILLS HEDGE FUND AND WEALTH MANAGEMENT BUSINESS On April 22, 2011, the Securities and Exchange Commission obtained an emergency court order to shut down a Beverly Hills, Calif. hedge fund and wealth management business targeting retirees, university professors, and members of the Christian community. The SEC alleges that IU Group Inc., its principal Elijah Bang, and its salesperson Daniel Lee targeted retirees and claimed on websites to have been founded by "devoted Christians who believe in God, Jesus Christ, and the Holy Spirit." Lee allegedly also sent "cold call" e-mail solicitations to university professors. It appears that IU Group was unsuccessful in obtaining any hedge fund investors or wealth management clients before the SEC's emergency action halted its operations. According to the SEC's complaint filed in federal court in Los Angeles, Bang and Lee made numerous false representations to potential investors and wealth management clients, including the following statements: The hedge fund was operational and had a successful performance history since January 2007. The majority of IU Wealth's clients are professional athletes, actors, producers, doctors, professors, politicians, and executives of private corporations. IU Wealth has over $800 million under management. The SEC alleges that Bang and Lee solicited potential investors and wealth management clients using various company names and websites, including IU Wealth Management, LLC and Icon Capital Management LLC. Lee also tried to find potential investors and clients using "cold call" e-mail solicitations. According to the SEC's complaint, IU Group and IU Wealth are not registered with the SEC. IU Group's business license was suspended by the State of California, and IU Wealth and Icon Capital are not companies of record in California. These entities have a mailing address in Beverly Hills, Calif., and Bang is believed to be a California resident. On May 19, 2009, California's Department of Corporations ordered IU Investments LLC, Bang, and Lee to desist and refrain from the unlawful offer or sale of securities and from the fraudulent sale of securities. The SEC's complaint charges all defendants with violations of the registration and antifraud provisions of Sections 5(c) and 17(a) of the Securities Act of 1933. The complaint also charges defendant Bang with violations of the investment adviser antifraud provisions of Sections 206(1), 206(2), and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder. The Honorable Margaret M. Morrow, U.S. District Judge for the Central District of California, granted the SEC's request for emergency relief for investors, including an order temporarily enjoining defendants IU Group and Bang from future violations of the antifraud provisions. A hearing on whether a preliminary injunction should be issued against the defendants IU Group and Bang is scheduled for May 6, 2011, at 10:00 a.m. PT. SEC Complaint in this matter