SEC v. CREATIVE CAPITAL CONSORTIUM, LLC; A CREATIVE CAPITAL CONCEPTS, LLC; and GEORGE L. THEODULE, No. 9:08-cv-81565, Southern District of Florida (Dec. 30, 2008) — Complaint

Case 9:08-cv-81565-DTKH Document 1
Entered on FLSD Docket 12/29/200~
FI(PQdje 1&I0 D.C. I
ELECTRO IC
DEC 29,2008

STEVEN M. LARIMORE
CLERK
U.S. DIST. CT.
UNITED STATES DISTRICT COURT
S.O. OF FLA.. MIAMI
I
I
SOUTHERN DISTRICT OF FLORIDA
CASE NO.
08-81565-ClV-HURLEYIHOPKINS
SECURITIES AND EXCHANGE COMMISSION,
Plaintiff,
v.
CREATIVE CAPITAL CONSORTIUM, LLC,

A CREATIVE CAPITAL CONCEPTS, LLC, and

GEORGE
L. THEODULE,

Defendants.
COMPLAINT FOR INJUNCTIVE AND OTHER RELIEF
Plaintiff Securities and Exchange Commission alleges:
INTRODUCTION
1. The Commission brings this action to enjoin Creative Capital Consortium, LLC
("Consortium"),
A Creative Capital Concept$, LLC ("Concept$") (collectively "Creative
Capital" or "the Companies"), and George
L. Theodule from continuing to defraud investors
through their violations of the antifraud provisions of the federal securities laws.
2.
From at least November 2007 to the present, Theodule, directly and through the
Companies, has raised at least
$23.4 million from thousands of investors in an ongoing fraud and
Ponzi scheme targeting mostly Haitian and Haitian-American investors nationwide.
3.
Theodule solicits investments for the Companies primarily during in-person
presentations where he guarantees prospective investors a
100% return on their investment
within 90 days based on his successhl trading of stocks and options.
4. In reality, Thcodule has lost at least $18 million trading stocks and options over
the last year.
In addition, Creative Capital merely repaid earlier investors with approximately

$15.2 million collected from new investors in typical Ponzi scheme fashion. Finally, Theodule
has commingled investor hnds with his personal funds and misappropriated at least $3.8 million
for himself and his family members.
5. As recently as mid-December, the Defendants have continued to solicit new
investors and repeated the false claims about Theodule's trading prowess.
6.
Through this ongoing fraudulent conduct, the Defendants have violated and,
unless restrained and enjoined, will continue to violate Section 10(b) of the Securities Exchange
Act of 1934 ("Exchange Act") [15 U.S.C.
$ 78j(b)], and Rule lob-5 promulgated thereunder [I7
C.F.R. Q; 240.10b-51.
DEFENDANTS
7. Concept$ is an inactive Florida limited liability company organized in November
2007. Theodule is Concept$'s manager, along with two other individuals. Concept$ was the
initial entity Theodule used to raise funds from investors until he formed Consortium.
8. Consortium is a Florida limited liability company organizcd in January 2008 with
its principal place of business in Lake Worth, Florida. Consortium became the primary entity
through which Theodule raised investor funds and transacted business with investment clubs.
9. Theodule, 48, currently resides in Loganville, Georgia, where he relocated from
Wellington, Florida in September 2008. He is the managing member of the Companies and
solicited investors.
JURISDICTION AND VENUE
10. The Court has jurisdiction over this action pursuant to Sections 21(d), 21(e), and
27 of the Exchange Act [15 U.S.C.
$9 78u(d), 78u(e), and 78aal.

1 I. The Court has personal jurisdiction over the Defendants, and venue is proper in
the Southern ~istrict' of Florida because many of the Defendants' acts and transactions
constituting violations of the Exchange Act occurred in the Southern District of Florida. In
addition, Creative Capital's principal place of business is in the Southern District of Florida, and
until rccently Theodule resided in thc Southern District of Florida.
12. In connection with the conduct alleged in this Complaint, the Defendants, directly
and indirectly, singly or in concert with others, have made use of the means or instrumentalities
of interstate commerce, the means or instruments of transportation and communication in
interstate commerce, and the mails.
THE DEFENDANTS' FRAUDULENT INVESTMENT SCHEME
A. Overview of the Scheme
13.
The Defendants have engagcd in a  fraudulent Ponzi scheme primarily targeting
the
US Haitian community since at least November 2007.
14. Theodule ingratiates himself with investors by claiming he recently decided to offer
his investment expertise to help build wealth in the Haitian community. He also tells investors
he uses part of his trading profits to hnd start-up businesses in the Haitian community, as well as
business projects in Haiti and Sierra Leone.
15. The Defendants primarily attract investors through word-of-mouth, and Theodule
makes his representations during face-to-face meetings in which he touts his ability to double
investor hnds in just
90 days. Theodule typically depicts his investment plan and incredible
profits trading stocks and options on dry erase boards or flip charts.
16.
Theodule also routinely boasts to investors about Creative Capital's high rates of
return, and stresses the need to begin investing as soon as possible. He told one investor he had

made millionaires out of a  significant number of people in the time it had taken her to decide to
invest, and
pressured her to liquidatc thc equity in her home to invest with him.
17.
The Defendants' prcscntations also emphasize the safety and security of investing
with them. They guarantce investors 100% returns with no risk, and claim to invest in the stocks
and options of wcll-known companies such as Google, John Decrc, Monsanto, Best Buy,
Gamestop, and othcrs.
18. Since the commencement of the investment scheme, the Defendants have raised
more than $23.4 million from thousands of investors nationwide.
B.
Investor Funds Are Also Raised Through a Network of Investment Clubs
19. To add to investors' sense of security, Theodule directs prospective investors to
form "investment clubs," which a purported self-regulatory agency, Smart Investment
Management Services, LLC ("SIMS"), helps the invcstors form. This entity also supposedly
protects investors through independent verification of their deposits.
20.
In reality, SIMS is a private company run by a former Creative Capital employee
and not a regulatory cntity.
21.
The investment clubs pool investor funds and send them to Creative Capital for a
90-day period, during which Theodule purportedly trades stocks and options on behalf of the
investment club members.
22. Unlike a real investment club, the members do not participate in making
investment decisions, rarely have club meetings, and deposit hnds exclusively with the
Defendants.
23. Thus, the investment clubs serve principally as vehicles to he1 hnds to
Theodule and Creative Capital.

24. The investment clubs typically require a minimum $1,000 investment per
investor, which the investor may not withdraw for the 90-day investment period.
25.
The investment clubs deposit thc investors' funds into their own bank accounts,
pool the funds, and remit the money to Creative Capital, minus a  10% club commission.
26. At the end of the 90-day investment period, whcn the Defendants have
purportedly doubled the investment amount, they supposedly return the principal and profits
back to the investment clubs, minus a 40% commission on the profits. Prior to distributing the
proceeds back to the individual club members, the investment clubs typically charge a  second
10% commission on the principal.
C. Fraudulent Misrepresentations and Omissions
27. In connection with Defendants' fraudulent Ponzi scheme, they have made and
continuc to make numerous material misrepresentations and omissions regarding Creative
Capital's business, Theodule's stock trading, and the use of investor funds.
28. For example, Theodule's claim of success trading stocks and options is
demonstrably false. Of the more than $18.3 million deposited in brokerage accounts Thcodule
controls, he has lost approximately 97% of those funds trading stocks and options. In fact,
Theodule has consistently lost money trading in those accounts since November 2007, and has
never generated net trading profits.
29. However, Creative Capital hid those losses from current and prospective
investors, paying principal and purported profits to existing investment clubs and individual
investors of approximately $15.2 million from new investor funds.

30.
Additionally, Theodule claims he uses trading profits to fund new business
ventures, some of which benefit the Haitian community in the United States and Haiti, and others
in Sierra Leone.
31.
In rcality, there were no trading profits, and most of the funds the Defendants
disbursed went to pay earlier investors their purported profits, not fund business projects.
32.
Theodule's representations about the safety and security of investors' funds are
also patently false. SlMS is not a  regulatory agency, but rather a  private entity that was, until
recently, headed by a former Creative Capital employee.
33.
Further, there is no evidence that SIMS has access to or otherwise verifies the
deposits to ensure the safety of investor funds. To the contrary, Thcodule has commingled
investor funds extensively with his own personal accounts and has misappropriated at least $3.8
million.
This includes net transfers of at least $1.7 million to his personal bank accounts, cash
withdrawals of more than
$1.5 million and more than $600,000 for apparent personal expenses
such as two luxury vehicles, credit card bills, a wedding payment, and a house down payment.
34.
Thus, Theodule misrepresented the safety and security of the Creative Capital
investments when he led investors to believe: they could' withdraw their funds any time after the
initial 90-day investment period; there was no risk; and SIMS verified the security of their funds.
CLAIM FOR RELIEF

Fraud
in Violation of Section 10(b) of the Exchan~e Act and Rule lob-5 Thereunder

35.
The Commission repeats and realleges Paragraphs
I through 34 of the Complaint.
36.
Starting no later than November 2007, the Defendants, directly and indirectly,
by
use of the means and instrumentality of interstate commerce, and of the mails in connection with
the purchase or sale of securities, have been knowingly, willfully or recklessly: (a) employing

Case 908-cv-81565-DTKH Document 1 Entered on FLSD Docket 12/29/2008 Page 7 of 70
devices, schemes or artifices to defraud; (b) making untrue statements of material facts and
omitting to state material facts necessary in order to make the statements made, in the light of the
circumstances under which they were made, not mislcading; or (c) engaging in acts, practices
and courses of business which have operated, are now operating and will operate as a fraud upon
the purchasers of such securities.
37.
By reason of the foregoing, the Defendants have directly or indirectly violated
and, unless restrained and enjoined, will continue to violate Section 10(b) of the Exchange Act
[15
U.S.C. 5 78j(b)] and Rule lob-5 [17 C.F.R. 5 240.10b-51.
RELIEF REQUESTED

WHEREFORE,
the Commission respectfully requests the Court:

1.

Declaratorv Relief

Declare, determine and find that the Defendants have committed the violations of the
federal securities laws alleged herein.
11.

Temporary
restrain in^ Order, Preliminary Iniunction, and Permanent lniunction

Issue a Temporary Restraining Order, a Preliminary Injunction, and a Permanent
Injunction, restraining and enjoining the Defendants, their officers, agents, servants, employees,
attorneys, and all persons in active concert or participation with them, and each of them, from
violating Section 10(b) of the Exchange Act and Rule lob-5 thereunder, as indicated above.
111.

Asset Freeze and Sworn Accountings

Issue an Order freezing the assets of all Defendants until further Order of the Court and

requiring the Defendants to file with this Court sworn written accountings.
IV.

Repatriation of Investor Proceeds

Issue an Order requiring the Defendants to take such steps as necessary to repatriate to
the territory of the United States all funds and assets of investors described in the Commission's
Complaint in this action which are held by them or are under their direct or indirect control, and
deposit such funds into the registry of the United States District Court for the Southern District
of Florida, and provide the Commission and the Court a  written description of the funds and
assets repatriated.
v.
Records Preservation
Issue an Order prohibiting the destruction of and requiring the Defendants to preserve
any records relating to the subject matter of this lawsuit that are in their custody or possession or
subject to their control.
VI.

Disporpement

Issue an Order directing the Defendants to disgorge all ill-gotten gains, including
prejudgment interest, resulting from the acts or courses of conduct alleged
in this Complaint.
VII.
Issue an Order directing the Defendants to pay civil money penalties pursuant to Section
21(d) of the Exchange Act [15 U.S.C. $78u(d)].

VIII.
Further Relief
Grant such other and further relief as may be necessary and appropriate.
IX.
Retention of Jurisdiction
Further, the Commission respecthlly requests that the Court retain jurisdiction over this
action in order to implement and carry out the terms of all orders and decrees that it  may enter, or
to entertain any suitable application or motion by the Commission for additional relief within the
jurisdiction of this Court.
December 29,2008 Respecthlly submitted,
,
By:
Brian
K. Bany
Senior Trial Counsel
Florida Bar No. 0632287
Direct Dial: (305) 982-6382
Email: barrvb(3sec.gov
Christopher
E. Martin
Senior Trial Counsel
SD Fla. Bar No. A5500747
Direct Dial: (305) 982-6386
Ernail: mastincC~scc.~ov
Teresa Verges
Assistant Regional Director
Florida Bar No. 997651
Direct Dial: (305) 982-6384
Email: verrest(iilscc.cov
Attorneys for Plaintiff
SECURITIES AND EXCHANGE
COMMISSION
801 Brickell Avenue, Suite 1800
Miami, Florida 33
131
Telephone: (305) 982-6300
Facsimile: (305) 536-4 154

'LJS 44 IRer. :UR)
CIVIL COVER SHEET
The JS 44 civil coversheet and the information contained herein neither re lacenor su plement the filing and service ofpleadings orother apersasre uired by law. except as  provided
by local rules of coun. This form, approved by the Judicial conference o8he United [rates in Septembcr
1974, is rcqu~rcd for thc usc oftgc clerk oftoun for the purpose of ~nitiating
thccivil docket sheet.
(see lNSTRU('TIONS ON THE REVERSE OF THE FORM.)
NOTICE: I\ttorneys MUST Indicate All Re-filed Cases Below.
1. (a) PLAINTIFFS 	DEFENDANTS
SECURITIES AND EXCHANGE COMMISSION
CREATIVE CAPITAL CONSORTIUM, LLC.
A CREATIVEI
CAPITAL CONCEPT$, LLC,
and GEORGE L. THEODULE
(b) County of Residence of First Listed Plaintiff
County of Residence of First Listed
)N OF THE TR.\CT
11. BASIS OF JURlS
(For Divcrsily ('ale, Only)
ror Dcl'en~lu~~l)
,/l I 11,s (twernntcn~ 7 3 Federal Oneslion PTF DEF
PTF DEF
l'lil~nl~li (US. tiovcrnnicnc Nola Prrly)
3 ? U.S. tiovcrnnicnl 3 4 Divcrsily 	C~laren al'Ant,lhcr Slale 3 2 3 2 ~rudPrincipal Plilrc 3 5 7 5lnrorp~>rulrd
Dcl'cndunl ol'D~~siner, In Analhrr Slalc
. 3 .3 Foreign Na~ion 3 6 3 6
IV. 	NATURE OF SUIT (Place an ..x.. in Onc Box only)
CONTRACT I TORTS U IFORFEITUREIPENAI.TYBANKRUPTCY
OTHER STATUTES
I 	I
3 1111 Insarancc
PERSONAL INJURY
PERSONAL INJURY
3 6111 Agricullure
3 422 Appeal ?x LISC' ISX 11 4110 Slale Reappurloonnlenl
3 121) Marme
3 3IU Airplane 3 3h? Personal lnjury -
3 h2U Olher Food & Drug 3 423 Wllhdril~al
7 4 111 Anlilrltsl
3 130 Mnller ACI
3 3 15 Airplane Producl
Mcd. Malpractice
3 625 Drug Rclulcd Sc~rurc
?R USC 157
7 4311 Baahs and Banklng
3 140 Ncguliable lnrlrumcnl
Liahtlily
3 165 Perronal lnjury -
ul'l'ruprrly 21 USC XU1
3 450 C~lninicrcr
11 150 Recut cry ol'Orcrpibyrnen~
3 320 Ah,null. Libcl &
Prodscl Liabilily
3 630 Llquur Law,
PROPERTY RIGHTS
3 461) Depurlulbon
& Enl'or'emen~ ol'Judglrcnl
Slander
3 368 Asbcslor Personal
3 640 R.R. & Truck 3 X20 Copyrighl5
3 4711 Rocketeer Inllt~encnl ilnd
3 15 1 Meducare Acl
3 310 Federal Employers'
lnjury Pruducl
3 6511 Airline Regs.
3 XSU Palenl
('<lrrupl
Orguntruln~ns
3 IS? Rccovcry ol'Delsul~crl
Liabilily
Liabalily
3 660 Occupalional 3 X4U Trademark
3 480 Cunsamrr Crcdll
Slnndenl Lui~ns
3 340 Marune
PERSONAL PROPERTI
SaTely!Heallli
3 4911 ('able Sat TV
(Excl. Vrlaranh)
3 345 Marone Pruduul 3 370 Olhcr Fraud 3 690 Other I
3 KIO Sclcrlne Scntre
3 153 Recovcry ol'Ovcrpayment
3 171 Truth in Lending
LABOR
1 SOCIAL SECURITY
4 X5ll Srcurtl~rr ( a~~i~~~wtl~ll~i.
ol'vclcrtln'r Bcneli~r
J 3x0 Olher Penonal
3 710 Fa~r LaborSlandords 13 X61 HlA IIJVSin
r\rl>ibugr
7 100 Sloclholdcr\' Sulls
3 355 Mulur Vehicle
Pruperly Damage Ael
3 Xh2 Black Lung (923) 3 R75 Cllrlunler Cliallengc
3 lVl) Olhrr ('onlracl
I
Pruducl Llabillly
3 3x5 Pruprny Damage
3 Relalion,
12 LISC' 3411)
720 LnhurlMgn~~.
3 Xh3 DIWCIDIWW 1405(g))
3 195 Cnnlrncl Produc~ Liahll~lv
3 IhU Other Personal Prodvul Liahililv
3 730 L.ahurlMgm~.Rcpur~ing
3 X6.I SSID Tillc XVI
3 8UIl Olller Slalulury Auliun,
3 196 Franuhiac I lnjl~ry
& Disclo,i~re Act
3 865 RSI (4IIJ(g))
3 LV I Agrlcullurill Acls
I REAL PROPERTY I CIVIL RIGHTS
I PRISONER PETITIONS
3 740 Railway Labor ACI
FEDERAL TAX SUITS
LY? Ecunnrn!~ Acl
3 Slab~l~rat~on
3 ?IIILand Cundrmnalion
13 441 VYI~~E 13 510 Mulion, lu Vacale
3 791) Olher I.uhur Liligdln~n
3 870 Tuxes 1U.S. Plainlill
3 RV3 L'nr lronnlenlal Mnllerr
7 220 Foreclosure
3 442 Empluymenl
Senlence
3 79 1 Cnlpl. Rel. Inc. Seesril)
or Defrndanl)
3 894 Lnergy ~\llocal!n~t Acl
3 230 Rcnl Lcarc (I; Ejcclmenl
3 143 HuttalnZ;
Hsbcar
Corpus:
API
3 X71 IRS Thard Party
J 240 Torts 10 Land Arcurnn,oda~~on~
3 530 tiellera1
26 LIS(' 761IcJ
XVS Frcedum oilnlbrnislion .\el
3 245 Tor1 Produel Liah~lily
3 444 Wellsre
3 535 Dcalh Penally
3 9llll Appeal ol'Frr Detcrn~~n.$l~un
I
-,29u AllOlller Prupcrly
445 Amer. w:Di,rbililics
.
3 540 Mandamus & Olhel
4h2 Nilluraliraliun
Under Equal Acccs:. lu Jurlre
Employment
Appliculiun
446 Amcr. wiDisabililies
-
Olhcr
3 550 ('ivil Righlr
3 440 Olhcr Civil Right*
3 555 Pribon Condmliun
V. ORIGIN
(place an '.x.. in one Bur. only)
Ap eal to District
,Pl I Original 0 2 Removed from 0 3 Re-filed-
~
or j Transferred from~ ~
17
~
from
0 4 ~0 5 another district ~ ~ d~ 0 6 Mu,tidist.ct
Proceeding State Court (see V1 below) Reopened 	Litigation Magistrate
(specify) 	Jud~ment
a) Re-filed Case 0YES ,0 NO
b) Related Cases 0YES QNO
VI. RELATEDIRE-FILED
(See in,,rucl,ons
CASE(S).
hecond page):
JUDGE DOCKETNUMBER
I
Cite the U.S. Civil Statute under which you are filing and Write n Brief Statement of Cause (Do not cite jurisdictional statutes unless
diversity):
VIr. CAUSE OF ACTION
IS-U.S.C. $ 78j(b), 17 C.F.R. 9 240.10b-5. Violations of the federal securities laws.
ILENGTH OFTRIAL via 8days estimated (for both sides to try entire case)
V111. REQUESTED rh'
0 CHECK IF THIS IS A CLASS AnION TROPEEktEE CHECK YES only if demanded in complaint:
COMPLAINT: UNDEK F.K.C.P. 23 JURY DEMAND: 0 Yes No
ABOVE INFORMATION ISTRUE & CORRECT TO
OFRECORD
THE BEST OF MY KNOWLEDGE
penalty DATE
12/29/08
FOR OFFICE USE ONLY
AMOUNT RECEIPT P IFP

Case 9:08-cv-81565-DTKH Document 1 Entered on FLSD Docket 12/29/200~ FI(PQdje 1&I0 D.C. I 
ELECTRO IC 

DEC 29,2008 


STEVEN M. LARIMORE 
CLERK U.S. DIST. CT. 

UNITED STATES DISTRICT COURT S.O. OF FLA.. MIAMI I I 
SOUTHERN DISTRICT OF FLORIDA 

CASE NO. 
08-81565-ClV-HURLEYIHOPKINS 

SECURITIES AND EXCHANGE COMMISSION, 

Plaintiff, 
v. 

CREATIVE CAPITAL CONSORTIUM, LLC, 

A CREATIVE CAPITAL CONCEPTS, LLC, and 

GEORGE L. THEODULE, 


Defendants. 

COMPLAINT FOR INJUNCTIVE AND OTHER RELIEF 

Plaintiff Securities and Exchange Commission alleges: 

INTRODUCTION 

1. The Commission brings this action to enjoin Creative Capital Consortium, LLC 

("Consortium"), A Creative Capital Concept$, LLC ("Concept$") (collectively "Creative 

Capital" or "the Companies"), and George L. Theodule from continuing to defraud investors 

through their violations of the antifraud provisions of the federal securities laws. 

2. From at least November 2007 to the present, Theodule, directly and through the 

Companies, has raised at least $23.4 million from thousands of investors in an ongoing fraud and 

Ponzi scheme targeting mostly Haitian and Haitian-American investors nationwide. 

3. Theodule solicits investments for the Companies primarily during in-person 

presentations where he guarantees prospective investors a 100% return on their investment 

within 90 days based on his successhl trading of stocks and options. 

4. In reality, Thcodule has lost at least $18 million trading stocks and options over 

the last year. In addition, Creative Capital merely repaid earlier investors with approximately 



Case 9:08-cv-81565-DTKH Document 1 Entered on FLSD Docket 12/29/2008 Page 2 of 10 

$15.2 million collected from new investors in typical Ponzi scheme fashion. Finally, Theodule 

has commingled investor hnds  with his personal funds and misappropriated at least $3.8 million 

for himself and his family members. 

5. As recently as mid-December, the Defendants have continued to solicit new 

investors and repeated the false claims about Theodule's trading prowess. 

6.  Through this ongoing fraudulent conduct, the Defendants have violated and, 

unless restrained and enjoined, will continue to violate Section 10(b) of the Securities Exchange 

Act of 1934 ("Exchange Act") [15 U.S.C. $ 78j(b)], and Rule lob-5 promulgated thereunder [ I7  

C.F.R. Q; 240.10b-51. 

DEFENDANTS 

7. Concept$ is an inactive Florida limited liability company organized in November 

2007. Theodule is Concept$'s manager, along with two other individuals. Concept$ was the 

initial entity Theodule used to raise funds from investors until he formed Consortium. 

8. Consortium is a Florida limited liability company organizcd in January 2008 with 

its principal place of business in Lake Worth, Florida. Consortium became the primary entity 

through which Theodule raised investor funds and transacted business with investment clubs. 

9. Theodule, 48, currently resides in Loganville, Georgia, where he relocated from 

Wellington, Florida in September 2008. He is the managing member of the Companies and 

solicited investors. 

JURISDICTION AND VENUE 

10. The Court has jurisdiction over this action pursuant to Sections 21(d), 21(e), and 

27 o f  the Exchange Act [15 U.S.C. $9 78u(d), 78u(e), and 78aal. 



Case 9:08-cv-81565-DTKH Document 1 Entered on FLSD Docket 12/29/2008 Page 3 of 10 

1 I. The Court has personal jurisdiction over the Defendants, and venue is proper in 

the Southern ~ is t r ic t '  of Florida because many of the Defendants' acts and transactions 

constituting violations of the Exchange Act occurred in the Southern District of Florida. In 

addition, Creative Capital's principal place of business is in the Southern District of Florida, and 

until rccently Theodule resided in thc Southern District of Florida. 

12. In connection with the conduct alleged in this Complaint, the Defendants, directly 

and indirectly, singly or in concert with others, have made use of the means or instrumentalities 

of interstate commerce, the means or instruments of transportation and communication in 

interstate commerce, and the mails. 

THE DEFENDANTS' FRAUDULENT INVESTMENT SCHEME 

A. Overview of the Scheme 

13. The Defendants have engagcd in a fraudulent Ponzi scheme primarily targeting 

the US Haitian community since at least November 2007. 

14. Theodule ingratiates himself with investors by claiming he recently decided to offer 

his investment expertise to help build wealth in the Haitian community. He also tells investors 

he uses part of his trading profits to h n d  start-up businesses in the Haitian community, as well as 

business projects in Haiti and Sierra Leone. 

15. The Defendants primarily attract investors through word-of-mouth, and Theodule 

makes his representations during face-to-face meetings in which he touts his ability to double 

investor h n d s  in just 90 days. Theodule typically depicts his investment plan and incredible 

profits trading stocks and options on dry erase boards or flip charts. 

16. Theodule also routinely boasts to investors about Creative Capital's high rates of 

return, and stresses the need to begin investing as soon as possible. He told one investor he had 



Case 9:08-cv-81565-DTKH Document 1 Entered on FLSD Docket 12/29/2008 Page 4 of 10 

made millionaires out of a significant number of people in the time it had taken her to decide to 

invest, and pressured her to liquidatc thc equity in her home to invest with him. 

17. The Defendants' prcscntations also emphasize the safety and security of investing 

with them. They guarantce investors 100% returns with no risk, and claim to invest in the stocks 

and options of wcll-known companies such as Google, John Decrc, Monsanto, Best Buy, 

Gamestop, and othcrs. 

18. Since the commencement of the investment scheme, the Defendants have raised 

more than $23.4 million from thousands of investors nationwide. 

B. Investor Funds Are Also Raised Through a Network of Investment Clubs 

19. To add to investors' sense of security, Theodule directs prospective investors to 

form "investment clubs," which a purported self-regulatory agency, Smart Investment 

Management Services, LLC ("SIMS"), helps the invcstors form. This entity also supposedly 

protects investors through independent verification of their deposits. 

20. In reality, SIMS is a private company run by a former Creative Capital employee 

and not a regulatory cntity. 

21. The investment clubs pool investor funds and send them to Creative Capital for a 

90-day period, during which Theodule purportedly trades stocks and options on behalf of the 

investment club members. 

22. Unlike a real investment club, the members do not participate in making 

investment decisions, rarely have club meetings, and deposit h n d s  exclusively with the 

Defendants. 

23. Thus, the investment clubs serve principally as vehicles to h e 1  h n d s  to 

Theodule and Creative Capital. 



Case 9:08-cv-81565-DTKH Document 1 Entered on FLSD Docket 12/29/2008 Page 5 of 10 

24. The investment clubs typically require a minimum $1,000 investment per 

investor, which the investor may not withdraw for the 90-day investment period. 

25. The investment clubs deposit thc investors' funds into their own bank accounts, 

pool the funds, and remit the money to Creative Capital, minus a 10% club commission. 

26. At the end of the 90-day investment period, whcn the Defendants have 

purportedly doubled the investment amount, they supposedly return the principal and profits 

back to the investment clubs, minus a 40% commission on the profits. Prior to distributing the 

proceeds back to the individual club members, the investment clubs typically charge a second 

10% commission on the principal. 

C. Fraudulent Misrepresentations and Omissions 

27. In connection with Defendants' fraudulent Ponzi scheme, they have made and 

continuc to make numerous material misrepresentations and omissions regarding Creative 

Capital's business, Theodule's stock trading, and the use of investor funds. 

28. For example, Theodule's claim of success trading stocks and options is 

demonstrably false. Of the more than $18.3 million deposited in brokerage accounts Thcodule 

controls, he has lost approximately 97% of those funds trading stocks and options. In fact, 

Theodule has consistently lost money trading in those accounts since November 2007, and has 

never generated net trading profits. 

29. However, Creative Capital hid those losses from current and prospective 

investors, paying principal and purported profits to existing investment clubs and individual 

investors of approximately $15.2 million from new investor funds. 



Case 9:08-cv-81565-DTKH Document I Entered on FLSD Docket 12/29/2008 Page 6 of 10 

30. Additionally, Theodule claims he uses trading profits to fund new business 

ventures, some of which benefit the Haitian community in the United States and Haiti, and others 

in Sierra Leone. 

31. In rcality, there were no trading profits, and most of the funds the Defendants 

disbursed went to pay earlier investors their purported profits, not fund business projects. 

32. Theodule's representations about the safety and security of investors' funds are 

also patently false. SlMS is not a regulatory agency, but rather a private entity that was, until 

recently, headed by a former Creative Capital employee. 

33. Further, there is no evidence that SIMS has access to or otherwise verifies the 

deposits to ensure the safety of investor funds. To the contrary, Thcodule has commingled 

investor funds extensively with his own personal accounts and has misappropriated at least $3.8 

million. This includes net transfers of at least $1.7 million to his personal bank accounts, cash 

withdrawals of more than $1.5 million and more than $600,000 for apparent personal expenses 

such as two luxury vehicles, credit card bills, a wedding payment, and a house down payment. 

34. Thus, Theodule misrepresented the safety and security of the Creative Capital 

investments when he led investors to believe: they could' withdraw their funds any time after the 

initial 90-day investment period; there was no risk; and SIMS verified the security of their funds. 

CLAIM FOR RELIEF 


Fraud in Violation of Section 10(b) of the Exchan~e Act and Rule lob-5 Thereunder 


35. The Commission repeats and realleges Paragraphs I through 34 of the Complaint. 

36. Starting no later than November 2007, the Defendants, directly and indirectly, by 

use of the means and instrumentality of interstate commerce, and of the mails in connection with 

the purchase or sale of securities, have been knowingly, willfully or recklessly: (a) employing 



Case 908-cv-81565-DTKH Document 1 Entered on FLSD Docket 12/29/2008 Page 7 of 70 

devices, schemes or artifices to defraud; (b) making untrue statements of material facts and 

omitting to state material facts necessary in order to make the statements made, in the light of the 

circumstances under which they were made, not mislcading; or (c) engaging in acts, practices 

and courses of business which have operated, are now operating and will operate as a fraud upon 

the purchasers of such securities. 

37. By reason of the foregoing, the Defendants have directly or indirectly violated 

and, unless restrained and enjoined, will continue to violate Section 10(b) of the Exchange Act 

[15 U.S.C. 5 78j(b)] and Rule lob-5 [17 C.F.R. 5 240.10b-51. 

RELIEF REQUESTED 


WHEREFORE, the Commission respectfully requests the Court: 


1. 


Declaratorv Relief 


Declare, determine and find that the Defendants have committed the violations of the 

federal securities laws alleged herein. 

11. 


Temporary restrain in^ Order, Preliminary Iniunction, and Permanent lniunction 


Issue a Temporary Restraining Order, a Preliminary Injunction, and a Permanent 

Injunction, restraining and enjoining the Defendants, their officers, agents, servants, employees, 

attorneys, and all persons in active concert or participation with them, and each of them, from 

violating Section 10(b) of the Exchange Act and Rule lob-5 thereunder, as indicated above. 

111. 


Asset Freeze and Sworn Accountings 


Issue an Order freezing the assets of all Defendants until further Order of the Court and 



C a s e  9:08-cv-81565-DTKH Document 1 Entered on FLSD Docket 12/29/2008 P a g e  8 of 10 

requiring the Defendants to file with this Court sworn written accountings. 

IV. 


Repatriation of Investor Proceeds 


Issue an Order requiring the Defendants to take such steps as necessary to repatriate to 

the territory of the United States all funds and assets of investors described in the Commission's 

Complaint in this action which are held by them or are under their direct or indirect control, and 

deposit such funds into the registry of the United States District Court for the Southern District 

of Florida, and provide the Commission and the Court a written description of the funds and 

assets repatriated. 

v. 

Records Preservation 

Issue an Order prohibiting the destruction of and requiring the Defendants to preserve 

any records relating to the subject matter of this lawsuit that are in their custody or possession or 

subject to their control. 

VI. 


Disporpement 


Issue an Order directing the Defendants to disgorge all ill-gotten gains, including 

prejudgment interest, resulting from the acts or courses of conduct alleged in this Complaint. 

VII. 

Issue an Order directing the Defendants to pay civil money penalties pursuant to Section 

21(d) of the Exchange Act [15 U.S.C. $78u(d)]. 



Case 9:08-cv-81565-DTKH Document 1 Entered on FLSD Docket 12/29/2008 Page 9 of 10 

VIII. 

Further Relief 

Grant such other and further relief as may be necessary and appropriate. 

IX. 

Retention of Jurisdiction 

Further, the Commission respecthlly requests that the Court retain jurisdiction over this 

action in order to implement and carry out the terms of all orders and decrees that it may enter, or 

to entertain any suitable application or motion by the Commission for additional relief within the 

jurisdiction of this Court. 

December 29,2008 Respecthlly submitted, , 

By: 
Brian K. Bany 
Senior Trial Counsel 
Florida Bar No. 0632287 
Direct Dial: (305) 982-6382 
Email: barrvb(3sec.gov 

Christopher E. Martin 
Senior Trial Counsel 
SD Fla. Bar No. A5500747 
Direct Dial: (305) 982-6386 
Ernail: mastincC~scc.~ov 

Teresa Verges 
Assistant Regional Director 
Florida Bar No. 997651 
Direct Dial: (305) 982-6384 
Email: verrest(iilscc.cov 

Attorneys for Plaintiff 
SECURITIES AND EXCHANGE 
COMMISSION 
801 Brickell Avenue, Suite 1800 
Miami, Florida 33 131 
Telephone: (305) 982-6300 
Facsimile: (305) 536-4 154 



Case 9:08-cv-81565-DTKH Document 1 Entered on FLSD Docket 12/29/2008 Page 10 of 10 
'LJS 44 IRer .  :UR) 	 CIVIL COVER SHEET 
The JS 44 civil coversheet and the information contained herein neither re lacenor su plement the filing and service ofpleadings orother apersas re uired by law. except as provided 
by local rules o f  coun. This form, approved by the Judicial conference o8he United [rates in Septembcr 1974, is rcqu~rcd for thc usc oftgc clerk o f t o u n  for the purpose o f  ~nitiating 
thccivil docket sheet. ( s e e  lNSTRU( 'T IONS ON T H E  REVERSE O F  T H E  F O R M . )  NOTICE: I\ttorneys MUST Indicate All Re-filed Cases Below. 

1. (a )  PLAINTIFFS 	 DEFENDANTS 

SECURITIES AND EXCHANGE COMMISSION 	 CREATIVE CAPITAL CONSORTIUM, LLC. A CREATIVEI 
CAPITAL CONCEPT$, LLC, and GEORGE L. THEODULE 

(b) County o f  Residence o f  First Listed Plaintiff 	 County o f  Residence o f  First Listed 

) N  OF THE T R . \ C T  

11. BASIS O F  J U R l S  
(For Divcrsi ly ('ale, Only )  ror Dc l 'en~ lu~~ l )  

,/l I 1 1 , s  ( t w e r n n t c n ~  7 3 Federal Oneslion P T F  D E F  P T F  D E F  
l ' l i l ~ n l ~ l i  ( U S .  tiovcrnnicnc N o l a  Pr r l y )  

3 ? U.S. t iovcrnnicnl  3 4 Divcrsi ly 	 C~laren al'Ant,lhcr Slale 3 2 3 2 ~rudPrincipal Plilrc 3 5 7 5l n r o r p ~ > r u l r d  
Dcl'cndunl o l 'D~~siner,  I n  Analhrr  Slalc 

. 3 .3 Foreign N a ~ i o n  3 6 3 6 

IV. 	N A T U R E  O F  SUIT (Place an ..x.. in  Onc Box  o n l y )  

CONTRACT I TORTS U IFORFEITUREIPENAI.TYBANKRUPTCY O T H E R  S T A T U T E S  I 	 I 
3 1111 Insarancc P E R S O N A L  I N J U R Y  P E R S O N A L  I N J U R Y  3 6111 Agricullure 3 422 Appeal ?x LISC' ISX 11 4110 Slale Reappurloonnlenl 
3 121) Marme 3 3 I U  Airplane 3 3h? Personal ln jury - 3 h2U Olher Food & Drug  3 423 W l l h d r i l ~ a l  7 4 111 Anlilrltsl 
3 130 Mnller ACI 3 3 15 Airplane Producl Mcd .  Malpractice 3 625 Drug Rclulcd S c ~ r u r c  ?R USC 157 7 4311 Baahs and Banklng 
3 140 Ncguliable lnr l rumcnl Liahtli ly 3 165 Perronal ln jury - ul'l'ruprrly 21 USC XU1 	 3 450 C~ ln in ic rc r  
11 150 Recut cry ol'Orcrpibyrnen~ 3 320 Ah,null. L ibc l  & Prodscl L iabi l i ly  3 630 Llquur Law, P R O P E R T Y  R I G H T S  3 461) Depurlulbon 

& Enl'or'emen~ ol'Judglrcnl Slander 3 368 Asbcslor Personal 3 640 R.R. & Truck 3 X20 Copyrighl5 3 4711 Rocketeer In l l t~encn l  i lnd 
3 15 1 Meducare Ac l  3 310 Federal Employers' ln jury Pruducl 3 6511 Airline Regs. 3 XSU Palenl ('<lrrupl Orguntruln~ns 
3 IS? Rccovcry ol 'Delsul~cr l  L iabi l i ly  Liabalily 3 660 Occupalional 3 X4U Trademark 3 480 Cunsamrr Crcdl l  

Slnndenl L u i ~ n s  3 340 Marune P E R S O N A L  P R O P E R T I  SaTely!Heallli 3 4911 ('able Sat T V  
(Excl. Vrlaranh) 3 345 Marone Pruduul 3 370 Olhcr Fraud 3 690 Other I 3 KIO Sc lc r lne  Scn t re  

3 153 Recovcry ol'Ovcrpayment 	 3 171 Truth in  Lending L A B O R  1 S O C I A L  S E C U R I T Y  4 X5ll S r c u r t l ~ r r  ( a ~ ~ i ~ ~ ~ w t l ~ l l ~ i .  
o l 'vc lcr t ln ' r  B c n e l i ~ r  J 3x0 Olher Penonal  3 710 F a ~ r  LaborSlandords 13 X61 H l A  I I J V S i n  r \ r l> ibugr 

7 100 Sloclholdcr\ '  Sulls 3 355 M u l u r  Vehicle Pruperly Damage A e l  3 Xh2 Black Lung (923) 3 R75 Cllrlunler Cliallengc 
3 lV l )  O l h r r  ('onlracl I Pruducl Llabill ly 3 3x5 Pruprny Damage 3 Relalion, 12 LISC' 3411) 720 L n h u r l M g n ~ ~ .  3 Xh3 D I W C I D I W W  1405(g)) 
3 195 Cnnlrncl  P roduc~  L i a h l l ~ l v  3 I h U  Other Personal Prodvul L iahi l i lv  3 730 L.ahur lMgm~.Rcpur~ing 3 X6.I SSID Ti l lc  X V I  3 8UIl Olller Slalulury Auliun, 
3 196 Franuhiac I l n j l ~ r y  & Disclo,i~re Ac t  3 865 RSI  (4IIJ(g)) 3 LV I Agrlculluril l Acls 
I R E A L  P R O P E R T Y  I C I V I L  R I G H T S  I P R I S O N E R  P E T I T I O N S  3 740 Railway Labor ACI F E D E R A L  T A X  S U I T S  LY? Ecunnrn !~  Ac l3 S l a b ~ l ~ r a t ~ o n  
3 ? I IILand Cundrmnal ion 13 441 V Y I ~ ~ E  13 510 Mulion, l u  Vacale 3 791) Olher I.uhur L i l i gd ln~n  3 870 Tuxes 1U.S. P la in l i l l  3 RV3 L'nr lronnlenlal M nllerr 
7 220 Foreclosure 3 442 Empluymenl Senlence 3 79 1 Cnlpl. Rel. Inc. Seesril) or Defrndanl)  3 894 Lnergy ~\ l local !n~t A c l  
3 230 Rcnl  Lcarc (I; Ejcclmenl 3 143 HuttalnZ; Hsbcar  Corpus: API  3 X71 IRS Thard Party 
J 240 Torts 10 Land A r c u r n n , o d a ~ ~ o n ~  3 530 tiellera1 26 LIS(' 761IcJ 

XVS Frcedum oi ln lbrnis l ion .\el 

3 245 Tor1 Produel L i a h ~ l i l y  3 444 Wellsre 3 535 Dcalh Penally 	 3 9l l l l  Appeal o l 'F r r  De tc rn~~n.$ l~un  

I 
-,29u AllOlller Prupcrly 445 Amer. w:Di,rbililics .

3 540 Mandamus & Olhel  4h2 Ni l lural i ra l iun Under Equal Acccs:. l u  J u r l r e  
Employment Appliculiun 
446 Amcr. wiDisabili l ies -
O lhc r  3 550 ( ' iv i l  Righlr  

3 440 Olhcr C i v i l  Right* 3 555 Pribon Condmliun 

V. ORIGIN (place an '.x.. i n  o n e  Bur. o n l y )  Ap eal to District 
,Pl I Original 0 2 Removed from 0 3 Re-filed- ~ or j Transferred from~ ~ 1 7 ~from0 4 ~ 0 5 another district ~ ~ d~ 0 6 Mu,tidist.ct

Proceeding State Court (see V1 below) Reopened 	 Litigation Magistrate(specify) 	 Jud~ment 

a)  Re-filed Case 0YES ,0 NO b) Related Cases 0YES QNOVI. RELATEDIRE-FILED 
(See in,,rucl,onsCASE(S).  hecond page): JUDGE DOCKETNUMBER 

I 
Cite the U.S. Civi l  Statute under which you are fi l ing and Write n Brief Statement o f  Cause (Do not cite jurisdictional statutes unless 
diversity): 

VIr. C A U S E  O F  ACTION IS-U.S.C. $ 78j(b), 17 C.F.R. 9 240.10b-5. Violations of the federal securities laws. 

ILENGTH OF TRIAL via 8days estimated (for both sides to try entire case) 

V111. R E Q U E S T E D  rh' 0 CHECK IF THIS IS A CLASS A n I O N  TRO P E E k t E E  CHECK YES only if demanded in complaint: 
C O M P L A I N T :  UNDEK F.K.C.P. 23 JURY DEMAND: 0 Yes No 

ABOVE INFORMATION ISTRUE & CORRECT TO OFRECORD 
THE BEST OF M Y  KNOWLEDGE penalty D A T E  

12/29/08 
F O R  O F F I C E  USE O N L Y  

A M O U N T  RECEIPT P IFP