SEC v. EARTHSOURCE MINERALS INTERNATIONAL, LLC; ABUNDANT RESOURCE DEVELOPMENT, LLLP; JASON M. WENDT; ARMANDO COSTABILE; PREMIER MINERALS INTERNATIONAL, LLC; and MICHAEL J. PALERMO, No. 6:21-cv-06198, Western District of New York (Mar. 2, 2021) — Complaint

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NEW YORK

SECURITIES AND EXCHANGE
COMMISSION,

Plaintiff,
COMPLAINT

    Case No.
v.

EARTHSOURCE MINERALS
INTERNATIONAL, LLC, ABUNDANT
RESOURCE DEVELOPMENT, LLLP,
JASON M. WENDT, ARMANDO
COSTABILE, PREMIER MINERALS
INTERNATIONAL, LLC and MICHAEL J.
PALERMO,

                                                     Defendants.

    JURY TRIAL DEMANDED

 Plaintiff Securities and Exchange Commission (the “Commission”) alleges as follows
against Defendants EarthSource Minerals International, LLC (“ESM”), Abundant Resource
Development, LLLP (“Abundant”), Jason M. Wendt (“Wendt”), Armando Costabile
(“Costabile”), Premier Minerals International, LLC (“PMI”) and Michael J. Palermo
(“Palermo”):
SUMMARY
1. This case concerns two overlapping offering frauds involving the sale of
investments related to gold and diamonds in Liberia in which defendants raised more than $5
million from approximately 250 investors.  In soliciting these investments, Defendants misled
investors about the safety and security of the investments, the use of investor funds, the extent of
the companies’ assets and liabilities and the companies’ historical production and profitability.

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2. From at least September 2014 through December 2019, Wendt and Costabile,
through their companies, ESM and Abundant, fraudulently induced at least 234 investors to
purchase more than $4.7 million in securities, the proceeds of which were to be used to fund
ESM’s mining business in Liberia.
3. For example, in communications with prospective investors, Wendt and Costabile
falsely stated that certain investments were “secured,” when they were not, and grossly
underreported ESM’s liabilities, leading investors to believe that ESM owed only $100,000 when
liabilities actually exceeded $4 million.  In one offering, ESM, Wendt and Costabile inflated the
profits investors could expect by underreporting certain expenses, falsely claiming that ESM was
required to pay royalties of 20% when, in fact, royalties were 55%
.
4. As part of the scheme, ESM, Abundant, Wendt and Costabile targeted Christian
faith-based communities by, among other things, touting that ESM would allocate a percentage
of profits to support humanitarian relief efforts in Liberia.
5. From at least December 2015 through April 2018, Palermo, through his company,
PMI, with the assistance of ESM, Wendt and Costabile, fraudulently induced 22 investors to
purchase an additional $501,906 in PMI securities, the proceeds of which were purportedly to be
invested in ESM’s mining business in Liberia.
6. PMI and Palermo raised money for a diamond flipping program that they claimed
to be running with ESM, claiming ESM would use the funds to purchase diamonds in Liberia for
resale in Florida at a profit.  In fact, ESM could not export diamonds from Liberia at that time
because ESM’s diamond dealer license had expired.  Palermo misled prospective investors in
another ESM-related mining investment by falsely stating that ESM had obtained financing in

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the seven figure range for the project and that mining production could commence within two
months, when, in fact, ESM did not have an agreement for the purported financing.
7. Instead of using investor funds as promised, Palermo misappropriated the
majority of the money he raised through PMI.  Palermo used investor funds to pay rent on his
home, personal automobile loan payments and for household expenses, travel and entertainment
expenses for his family and frequent purchases at restaurants, grocery, convenience and
department stores.  Palermo also used investor funds to repay prior investors purported interest
or profits distributions.
8. By engaging in the conduct described in this Complaint, Defendants ESM,
Abundant, Wendt, Costabile, PMI and Palermo violated, and unless enjoined will continue to
violate, Section 17(a) of the Securities Act of 1933 (“Securities Act”) [15 U.S.C. § 77q(a)] and
Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. § 78j(b)] and
Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].
JURISDICTION AND VENUE
9. The Commission brings this action pursuant to Sections 20(b) and 20(d) of the
Securities Act [15 U.S.C. §§ 77t(b) and 77t(d)], and Section 21(d) of the Exchange Act [15
U.S.C. § 78u(d)], to enjoin such acts, transactions, practices, and courses of business, and to
obtain disgorgement, prejudgment interest, civil penalties, and such other and further relief as the
Court may deem just and appropriate.
10. This Court has jurisdiction over this action pursuant to Sections 20(b) and 22(a)
of the Securities Act [15 U.S.C. §§ 77t(b) and 77v(a)] and Sections 21(d), 21(e) and 27 of the
Exchange Act [15 U.S.C. §§ 78u(d), 78u(e) and 78aa].

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11. Venue in this District is proper pursuant to Section 22(a) of the Securities Act [15
U.S.C. § 77v(a)] and Section 27 of the Exchange Act [15 U.S.C. § 78aa].  Among other things,
certain of the acts, transactions, practices, and courses of business constituting the violations
alleged herein occurred within the Western District of New York.  In addition, Wendt and
Costabile reside in this District, this District is the principal place of business for Abundant, the
principal U.S. business office of ESM is located in this District and Wendt, Costabile, Palermo
and PMI transact business in this District.
12. In connection with the conduct alleged in this Complaint, Defendants, directly or
indirectly, singly or in concert, made use of the means or instruments of transportation or
communication in, or instrumentalities of, interstate commerce, or the mails, or the facilities of a
national securities exchange.
DEFENDANTS
13. ESM is a Wyoming limited liability company with its principal place of business
in Monrovia, Liberia, and its principal U.S. office in Wendt’s home in Hilton, New York.
14. Abundant is a Wyoming limited liability limited partnership with its principal
place of business in Hilton, New York.  Abundant is controlled by Wendt and Costabile through
its general partner, which is owned and controlled by Wendt and Costabile.
15. Wendt, age 50, resides in Hilton, New York. Wendt has been the President of
Defendant ESM and the President of the general partner of Defendant Abundant since their
formation in August 2012 and August 2011, respectively.
16. Costabile, age 44, resides in Fairport, New York. Costabile has been Secretary
and Director of ESM and the Secretary and Director of the general partner of Defendant
Abundant since their formation in August 2012 and August 2011, respectively.

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17. PMI is a Florida limited liability company, with its principal place of business in
the home of Palermo, formerly in Safety Harbor, Florida and currently in Tarpon Springs,
Florida.
18. Palermo, age 46, resides in Tarpon Springs, Florida. Palermo has been the sole
Manager of PMI since its formation in October 2015 and became Chief Investment Officer of
ESM in 2016.
FACTS
19. Wendt and Costabile formed Abundant in August 2011, in order to raise funds for
a gold mining operation in Liberia. Wendt and Costabile formed ESM in August 2012 to serve as
the principal U.S. business office for their mining operation in Liberia.
20. Palermo formed PMI in October 2015 purportedly as an investment group that
would joint venture with ESM, with PMI providing investor funds to ESM, which purportedly
would be used by ESM, Wendt and Costabile to generate returns for PMI investors.
21. At all relevant times, PMI acted by and through Palermo.
THE ESM AND ABUNDANT OFFERING FRAUD
22. From at least September 2014 through December 2019, ESM, Abundant, Wendt
and Costabile fraudulently induced at least 234 investors, located in multiple states, including
New York, Pennsylvania and Florida to purchase at least $4.7 million in securities by making
numerous material misstatements regarding the safety and security of the investments, the use of
investor funds, the extent of ESM’s assets and liabilities and ESM’s historical production and
profitability.
23. In order to raise money to fund ESM’s mining operations, Wendt and Costabile
sold investments in three different investment programs: (1) the ESM Diamond Flipping

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Program (“ESM DFP”); (2) the Abundant Limited Liability Limited Partnership; and (3) the
ESM Garlo Joint Venture (“ESM Garlo JV”).
24. Wendt and Costabile marketed the securities in telephone calls, electronic mail
and face-to-face meetings with prospective investors, targeting Christian faith-based
communities. Wendt and Costabile conducted investor meetings at churches and encouraged new
investments during telephone and web-conference meetings during which they prayed for the
success of ESM’s mining endeavors while touting that a portion of ESM’s profits would be used
for humanitarian relief in Liberia. Wendt and Costabile told prospective investors that
investments with ESM and Abundant would aid development in Liberia while providing high
rates of returns to investors.  Many of the investors were financially unsophisticated with limited
investment experience.  Some investors purchased securities in two or more of the investment
programs.
25. Wendt and Costabile disregarded corporate formalities.  While they maintained
multiple bank accounts for ESM and Abundant, they often deposited investor funds intended for
one entity into the account of another entity.  Wendt and Costabile repeatedly moved funds
through various accounts they controlled and comingled investor funds for the ESM DFP with
the investor funds raised for ESM’s mining operations through Abundant.
A.  ESM Diamond Flipping Program
i. Wendt, Costabile and ESM Sold Over $1 Million in Investments in the ESM
DFP

26. Between September 2014 and September 2015, ESM, Wendt and Costabile sold
$1,020,550 in securities to at least 30 investors for the ESM DFP.
27. The securities that Wendt and Costabile sold to investors for the ESM DFP took
the form of “loan agreements,” in which Wendt, Costabile and ESM promised investors that they

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would receive monthly interest payments of 10% and the return of their principal within two to
four months.  The loan agreements also provided investors with the option of reinvesting their
accrued interest as principal and of extending the term of the loan so they could continue to
accrue interest.
28. Wendt and Costabile solicited investors to purchase the ESM DFP securities
using a set of written offering documents that they authored together.  The offering documents
referred to the loan agreements as a “speculative venture,” and a spreadsheet provided to each
ESM DFP investor identified the principal amount of the loan as the “total amount invested.”
29. In the offering documents, ESM, Wendt and Costabile told prospective investors
that investor funds would be used to purchase diamonds in Liberia that would be exported to the
United States for resale, which purportedly would generate sufficient profits to both pay the
monthly interest payments to ESM DFP investors and create an additional income stream for
ESM’s mining operations.
30. ESM DFP investors made payments of money to ESM and, in exchange, received
a loan agreement signed by Wendt on behalf of ESM.
31. Some ESM DFP investors wired their purchase payments directly to ESM’s bank
accounts controlled by Wendt and Costabile.  Others sent their payments to ESM through the
mail or by hand-delivery.
ii. Wendt, Costabile and ESM Misled ESM DFP Investors
32. ESM, Wendt and Costabile made material misrepresentations to ESM DFP
investors relating to the safety and security of ESM DFP investments and the use of investor
funds.

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33. In written offering documents distributed to prospective investors to induce them
to invest in the ESM DFP, Defendants ESM, Wendt and Costabile falsely stated that:
a. the investments in the ESM DFP were “secured” and that the minimum cash
value of the investments “will always be maintained as cash in the program’s
bank account or in the form of diamond assets”; and
b. the ESM DFP would generate sufficient cash flow to provide both “a great return”
to the ESM DFP investors of “10% interest per month” and “for ongoing ESM
operations and equipment purchases” and that “all proceeds from this program are
first allocated to the payment of interest and final payout of principal per” the
ESM DFP loan agreement.
34. Contrary to the representations in the offering materials, the ESM DFP did not
operate or perform as claimed.
35. Wendt and Costabile also did not segregate ESM DFP funds from ESM’s other
operating accounts as promised.  ESM actually used only a portion of the money invested in the
ESM DFP to purchase diamonds.  From the outset, Wendt and Costabile siphoned some of the
ESM DFP investor money out of the program and used it—not profits—to fund ESM’s other
mining operations.
36. For example, during the first two months the ESM DFP operated, ESM raised
over $590,000 from investors. Of that amount, ESM, Wendt and Costabile used only $390,900 to
purchase diamonds. The remainder was spent on other expenses for ESM’s mining operations.
37. Moreover, ESM, Wendt and Costabile actually lost money on the diamond
flipping transactions they did undertake. While ESM purchased $390,900 in diamonds between

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September and October of 2014, ESM received less than $316,000 from its diamond broker in
Florida when it resold those diamonds.  None of this was disclosed to investors.
38. Despite these losses, Wendt and Costabile encouraged investors to let their
investments roll over beyond the two to four months referenced in the loan agreement, so they
could continue accruing interest. In emails signed by both men, Wendt and Costabile told
investors that ESM had conducted diamond flips, and they sent updated spreadsheets to the
investors indicating that their ESM DFP investments had accrued 10% interest each month from
the diamond flipping transactions.
39. ESM, Wendt and Costabile continued operating the ESM DFP until December
2015 only because of the influx of new ESM DFP investments and most investors agreed to roll
over their investments based on ESM’s promise they could continue earning 10% monthly
interest.
40. Wendt and Costabile knew that ESM failed to invest much of the DFP
investments as promised and lost money on the diamond flipping transactions they did
undertake, and had no reasonable basis to claim that the ESM DFP could generate the promised
10% monthly return.
41. By December 2015, the ESM DFP was insolvent. Wendt and Costabile used the
proceeds from the last diamond flip on mining operations and to make interest payments to a few
investors, however, ESM still owed over $995,000 in principal and $2.2 million in interest to the
ESM DFP investors that ESM could not repay.

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B.  Abundant Limited Liability Limited Partnership
i. Wendt, Costabile and Abundant Sold Over $500,000 in Investments in
Abundant Since January 2016

42. Wendt and Costabile began raising money for ESM through Abundant in 2013.
At that time, ESM had six general partners, including Wendt and Costabile.  In early January
2016, the other four general partners officially separated from ESM with Wendt and Costabile
maintaining control of ESM.
43. By January 2016, ESM had spent all of the money it had previously raised
through the ESM DFP and Abundant. Wendt and Costabile began seeking new investments
through Abundant for ESM.
44. Between January 2016 and December 2016, Wendt and Costabile, through
Abundant, offered and sold securities totaling at least $559,000 to at least 105 investors.
45. Abundant, Wendt and Costabile told prospective investors that Abundant had a
40% ownership interest in ESM and that their investments in Abundant would be used to fund
ESM’s mining operations in Liberia.
46. The securities that Wendt and Costabile sold to investors in Abundant took the
form of limited liability limited partnership interests.  Wendt, Costabile and Abundant promised
limited partner investors that they would receive a pro rata distribution of the profits Abundant
received from ESM’s mining operation.
47. Wendt and Costabile solicited investors at in-person meetings and by sending
email about the company to prospective investors.
48. Wendt and Costabile also solicited investors to purchase the Abundant securities
using a set of written offering documents that they authored together.  The offering documents
referred to each limited partner’s capital contribution as “investment capital” and the purchase

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agreement for the limited partnership interest referred to Abundant as a “speculative venture”
and contained certain financial disclosures regarding the company.
49. Abundant investors made payments of money to Abundant and, in exchange,
received a purchase agreement signed by Wendt on behalf of the general partner of Abundant.
50. Some Abundant investors wired their purchase payments directly to Abundant’s
bank accounts, which are controlled by Wendt and Costabile.  Others sent their payments to
Abundant through the mail or by hand-delivery.
ii. Wendt, Costabile and Abundant Misled Abundant Investors

51. Abundant, Wendt and Costabile misled Abundant investors about the extent of
ESM’s outstanding liabilities and assets after the partner separation, ESM’s historical mining
production rates, and the profitability of the ESM DFP.
52. At an investor meeting on January 22, 2016, Wendt falsely stated that at the time
of the partner separation in January 2016, ESM had only $200,000 in liabilities, which ESM split
evenly with the separating partners, and that ESM oftentimes generated $200,000 per month
from its gold mining operation.
53. Similarly, a January 25, 2016 email to prospective investors, which was sent by
Wendt and signed by Wendt and Costabile, falsely stated that at the time of the partner
separation, ESM’s liabilities were split evenly with the separating partners and that the gold
mining operation had covered all of ESM’s operating expenses.
54. Contrary to the representations made by Wendt at the January 2016 investor
meeting and in the January 2016 email authored by Wendt and Costabile, at the time of the
partner separation, ESM had outstanding liabilities of over $4.3 million and the separating

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partners assumed responsibility for only $200,000 of ESM’s outstanding liabilities, leaving ESM
with responsibility for the remainder of more than $4 million.
55. Also contrary to Wendt’s representations at the January 2016 investor meeting
and the January 2016 email authored by Wendt and Costabile, ESM did not ever—let alone
often—generate $200,000 per month from its gold mining operation and the gold mining revenue
did not cover ESM’s operating expenses. In fact, ESM’s total annual gold production in 2015
was less than $100,000.
56. Written offering documents authored by Wendt and Costabile for Abundant and
distributed to prospective investors to induce them to invest in Abundant, also falsely stated that:
a. ESM had infrastructure worth $11 million; and
b. the ESM DFP had great short term results and was one of the best things ESM
ever did.
57. Contrary to these representations, ESM did not have infrastructure worth $11
million after the partner separation. ESM’s financial statements reflected that ESM had current
and fixed assets of only $1.1 million after the partner separation.
58. Furthermore, ESM did not have great short term results with the ESM DFP, but
actually lost money on its diamond flipping transactions.
59. Wendt and Costabile knew that their representations on behalf of Abundant
regarding ESM’s outstanding liabilities at the time of the partner separation, its historical mining
production rates, the value of its infrastructure assets and the profitability of the ESM DFP were
false.

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C.  ESM Garlo Joint Venture
i. Wendt, Costabile and ESM Sold over $3.1 Million in Investments in the ESM
Garlo Joint Venture

60. Between January 2017 and December 2019, ESM, Wendt and Costabile sold at
least $3,140,000 in securities to at least 158 investors for the ESM Garlo JV.
61. The securities that ESM, Wendt and Costabile sold to investors for the ESM
Garlo JV took the form of joint venture interests.
62. Wendt and Costabile solicited investors to purchase the ESM Garlo JV securities
using a set of written offering documents that they authored together for ESM.  The offering
documents referred to each joint venture investor’s capital contribution as “investment capital.”
63. The offering documents told prospective joint venture investors that their
investments would be used to fund ESM’s mining operations in Liberia at ESM mining sites
along the Garlo river.
64. The offering documents provided that investors would receive 20% of the
principal balance of their investment every 30 days when mining production commenced at the
Garlo site, until they recovered their principal investment plus 100% profit.
65. ESM Garlo JV investors made payments of money to ESM and, in exchange,
received an ESM Garlo Joint Venture Agreement signed by Wendt on behalf of ESM.
66. Some ESM Garlo JV investors wired their purchase payments directly to ESM
bank accounts controlled by Wendt and Costabile.  Others sent their payments to ESM through
the mail or by hand-delivery.

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ii. Wendt, Costabile and ESM Misled Garlo JV Investors

67. The ESM Garlo JV offering documents, which Wendt and Costabile prepared and
provided to prospective investors, provided misleading information about ESM’s expenses and
unreasonable profit projections.
68. The offering documents stated that ESM could generate monthly revenues of
$2,790,000 in gold and diamonds with monthly expenses of $921,700 resulting in monthly
profits of $1,868,300.
69. These projections were substantially inflated because they were based on vastly
understating royalties that ESM was required to pay to the Garlo site owner.  The offering
documents falsely claimed that ESM was required to pay royalties at a rate of only 20% of
revenue when, in fact, ESM was obligated to pay royalties of 55% to the site owner.
70. The projections also failed to include substantial expenses incurred by ESM
including salary payments made to Wendt, travel expenses for ESM staff who resided in the U.S.
and travelled to and from Liberia, diamond export taxes imposed by the Liberian government
and other overhead expenses.
71. Wendt and Costabile knew that their representations regarding the amount of
royalties owed to the Garlo site owner were false and that they failed to include other expenses
incurred by ESM, all of which had the effect of falsely inflating their profit projections for the
ESM Garlo JV.
THE PMI OFFERING FRAUD
72. From at least December 2015 through April 2018, PMI and Palermo, with the
assistance of ESM, Wendt and Costabile, fraudulently induced at least 22 investors to purchase
at least $501,906 in securities by making material misstatements and omissions regarding the

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safety and security of the PMI investments, the use of PMI investor funds and the profitability of
PMI investments.
73.  Palermo sold investments in two different investment schemes: (1) the PMI
Diamond Flipping Program (“PMI DFP”); and (2) the PMI Garlo Joint Venture (“PMI Garlo
JV”).
74. PMI and Palermo marketed the securities in telephone calls, electronic mail,
telephone and web conferences and face-to-face meetings with prospective investors.  Many of
the investors were financially unsophisticated with limited investment experience.
A.        PMI        DFP
i. Palermo and PMI Sold Over $250,000 in Investments in the PMI DFP
75. Between December 2015 and December 2016, PMI and Palermo sold at least
$258,360 in securities to at least 14 investors through the PMI DFP offering.
76. The securities that Palermo sold to investors in connection with the PMI DFP
took the form of promissory notes, in which PMI promised investors that they would receive
20% interest on the amount of their investment as well as the return of their principal within
three months.
77. PMI and Palermo solicited investors to purchase the securities using written
offering documents and newsletters that Palermo authored and emailed to prospective investors.
The offering documents referred to the promissory notes as an “investment opportunity,” and
described PMI’s diamond flipping program and the proposed terms of the offering.
78. PMI and Palermo told prospective investors that their investments would be used
by ESM for the purpose of purchasing diamonds in Liberia, which would be exported to Florida
for resale at a profit.

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79. PMI and Palermo stated in the offering documents and the newsletters that
investors would receive quarterly interest payments of 20% of their principal investment and
referred to those interest payments as “profit payouts.”
80. Investors made payments of money to PMI and, in exchange, received a
promissory note signed by Palermo on behalf of PMI.
81. Some investors wired their purchase payments directly to a PMI bank account
controlled by Palermo.  Others sent their payments to Palermo through the mail or by hand-
delivery.
82. Palermo frequently moved investor funds from PMI’s account to his own personal
account commingling investor funds with the assets in his personal account.
ii. Palermo, Wendt, Costabile and PMI Misled PMI DFP Investors
83. Contrary to the representations in the offering materials, when Palermo and PMI
were soliciting investments for the PMI DFP, PMI could not operate the diamond flipping
program with ESM because ESM’s diamond dealer license had expired in October 2015.  ESM
did not renew its diamond dealer license at any time during 2016.  Without a diamond dealer
license issued by the Liberian government, ESM could not export diamonds from Liberia and
ESM could not generate profits for investors through diamond flipping transactions.
84. Moreover, contrary to PMI’s and Palermo’s representations that the PMI DFP
investor funds would be used by ESM to purchase diamonds for the purported diamond flipping
program, Palermo actually sent very little money to ESM. Instead, Palermo misappropriated the
majority of the PMI DFP investor funds for his personal use and used a portion of the investor
funds to make interest payments to prior PMI DFP investors.

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85. In telephone conferences with prospective investors, Palermo, Wendt and
Costabile also made oral misrepresentations to prospective investors to induce them to invest in
the PMI DFP.  For example:
a. During a February 2016 telephone conference, Palermo falsely stated that
ESM’s export of diamonds was safe and secure because ESM had
obtained a $500,000 insurance policy from Lloyd’s of London covering its
diamond exports;
b. During a February 2016 telephone conference, Wendt falsely stated that
ESM generated a 52% net profit margin on the diamond transactions in the
prior ESM DFP; and
c. During a November 2016 telephone conference, Costabile falsely stated
that the PMI DFP investment was “safe” because the capital “within the
program is either always with us in the form of the liquid capital or the
value of the stones.”
86. Contrary to Palermo’s oral representations, ESM did not obtain a $500,000
insurance policy from Lloyd’s of London for its export of diamonds.
87. Palermo knew that ESM did not actually obtain the insurance policy. Palermo was
the person who worked on behalf of ESM in late 2015 and early 2016 trying to obtain insurance
coverage for ESM’s diamond exports, he knew that ESM had not implemented security measures
required by the insurance broker and he knew that ESM did not obtain the insurance policy.
88. Contrary to Wendt’s oral representations to prospective PMI DFP investors, ESM
did not earn a 52% net profit margin on its prior diamond flipping transactions. Instead, ESM
actually lost money on its diamond flipping transactions through the ESM DFP.

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89. Wendt knew that ESM had lost money on its ESM DFP and that ESM did not
have a 52% net profit margin on its diamond flipping transactions.
90. Contrary to Costabile’s oral representations to prospective PMI DFP investors,
PMI DFP investments were not safe and were not secured by diamonds purchased by ESM.
91. Costabile knew that, in reality, ESM used only a portion of the money invested in
the ESM DFP to purchase diamonds and that ESM, Wendt and Costabile had siphoned some of
the ESM DFP investor money out of the program and used it cover mining operational expenses.
92. Palermo encouraged PMI DFP investors to let their investments roll over beyond
the three months referenced in the promissory notes, so they could continue accruing interest.
Palermo told investors in emails that ESM had conducted diamond flips for PMI and that PMI
had paid out 20% profits at quarterly intervals during 2016.  These statements were false.
93. In addition, Wendt played a further role in the fraud by participating in roundtrip
transactions with PMI DFP investor funds. In particular, Palermo sent a small portion of the PMI
DFP investor funds to ESM, and Wendt promptly returned those same funds to PMI ostensibly
for PMI “DFP Payouts”, which created the illusion that ESM was generating profits from
diamond flipping transactions, when in fact, no diamond flipping transactions had occurred.
B.          PMI          Garlo          JV
i. Palermo and PMI Sold Over $240,000 in Investments in the PMI Garlo JV
94. Between January 2017 and April 2018, PMI sold at least $243,546 in securities to
at least 9 investors for the PMI Garlo JV.
95. The securities that PMI and Palermo sold to investors for the PMI Garlo JV took
the form of joint venture interests.

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96. Palermo solicited investors to purchase the PMI Garlo JV securities using a series
of written newsletters that Palermo authored.  The newsletters referred to joint venture
participants as “investors” and contributions by joint venture participants as “investor capital.”
97. In the newsletters, PMI and Palermo told prospective joint venture investors that
they would have a joint venture interest in ESM’s Garlo mining site through an investment in
PMI.  PMI and Palermo claimed that PMI Garlo JV investments would be used for the purpose
of funding ESM’s mining operations in Liberia at ESM mining sites along the Garlo river.
98. PMI and Palermo promised PMI Garlo JV investors that when ESM commenced
mining production at mining sites along the Garlo river they would receive 20% of the principal
balance of their investment every 30 days.
99. PMI Garlo JV investors made payments of money to PMI and, in exchange,
received a PMI Garlo Joint Venture Agreement signed by Palermo on behalf of PMI.
100. Some PMI Garlo JV investors wired their purchase payments directly to PMI
bank accounts controlled by Palermo.  Others sent their payments to PMI through the mail or by
hand-delivery.
ii. Palermo and PMI Misled PMI Garlo JV Investors
101. Contrary to the representations about how PMI Garlo JV investor funds would be
used, Palermo actually invested only a portion of the money that he raised through the sale of
PMI Garlo JV securities with ESM.  Instead, as discussed in greater detail below, Palermo
misappropriated the majority of the investor funds for his personal use and used some investor
funds to make interest payments to prior PMI investors.
102. In addition, Palermo misled investors about the operation of the ESM Garlo site.
In a December 2017 newsletter/email, Palermo falsely stated that ESM had obtained financing in

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the seven figure range that would allow ESM’s Garlo site to become fully mechanized and
mining production could commence within two months.
103. Contrary to Palermo’s representations, ESM did not have a signed agreement for
seven figure financing for the Garlo mining site. In fact, ESM never obtained an agreement for
financing in the seven figure range.
104. Palermo knew that ESM did not have a signed agreement for additional financing
and that full mechanized mining production at Garlo could not commence within 2 months.
C. Palermo Misused Investor Funds
105. PMI and Palermo claimed in written offering documents and newsletters that
investor funds for the PMI DFP would be used for the purchase of diamonds for diamond
flipping transactions and that investor funds for the PMI Garlo JV would be used to fund ESM’s
operations at mining sites along the Garlo river.
106. Palermo also made oral representations to investors and prospective investors that
PMI DFP investments would be used to purchase diamonds for diamond flipping transactions
and that PMI Garlo JV investments would be used to fund ESM’s mining operations along the
Garlo river.
107. Contrary to what investors were told in writing and orally, Palermo used the
majority of investor funds in ways not disclosed to investors.
108. For instance, without disclosing it to investors, Palermo misappropriated
$340,005 of investor funds to benefit himself and his family.
109. Palermo used investor funds to pay his personal expenses, including, among other
things, the rent on his home, personal automobile loan payments, household expenses, travel and

21

entertainment expenses for his family and frequent purchases at restaurants, grocery,
convenience and department stores.
110. Palermo also spent $80,623 to make purported interest or profit payments to prior
investors.  These payments were made to further the fraud by maintaining the appearance that
PMI’s business was performing as represented.
111. PMI and Palermo did not disclose to investors that they planned to, or did in fact,
use investor money for Palermo’s personal benefit, or that they used money from new investors
to repay earlier investors.
ESM, ABUNDANT, WENDT AND COSTABILE VIOLATED THE FEDERAL
SECURITIES LAWS

112. During the relevant period, Wendt and Costabile owned, operated, and controlled
ESM and Abundant.
113. The ESM DFP loan agreements, Abundant limited liability limited partnership
interests and ESM Garlo JV joint venture interests offered and sold to investors are securities
within the meaning of both the Securities Act and the Exchange Act.
114. In connection with the sales or offers to sell securities, ESM, Abundant, Wendt
and Costabile made use of means or instruments of interstate transportation or communication in
interstate commerce or of the mails, including using the internet, interstate phone calls, and the
United States mail. The conduct described herein was in the offer or sale of securities and in
connection with the purchase or sale of securities.
115. The misrepresentations and omissions set forth herein, individually and in the
aggregate, are material.  A reasonable investor would have considered the misrepresented facts
and omitted information—including, among other items, misrepresentations about the safety and
security of the investments, the use of investor funds, the extent of the companies’ assets and

22

liabilities and the companies’ historical production and profitability—important in deciding
whether or not to purchase ESM DFP loan agreements, Abundant limited liability limited
partnership interests and the ESM Garlo joint venture interests. Disclosure of the accurate facts
or omitted information would have altered the “total mix” of information available to investors.
116. In connection with the conduct described herein, ESM, Abundant, Wendt and
Costabile acted knowingly and/or recklessly and negligently.
117. ESM, Abundant, Wendt and Costabile were each makers of false and misleading
statements made in writing and orally regarding ESM and Abundant.  Wendt and Costabile
prepared the offering documents, the ESM DFP loan agreements, the Abundant purchase
agreements and the ESM Garlo Joint Venture agreements provided to investors on behalf of
ESM and Abundant. Wendt signed each of the loan agreements, purchase agreements and joint
venture agreements accepting the investments. Wendt and Costabile also were makers of the
false and misleading statements made orally regarding the PMI DFP.
118. Through their material misrepresentations and omissions, ESM, Abundant, Wendt
and Costabile each obtained money or property from investors.
119. Through this scheme, ESM, Abundant, Wendt and Costabile each engaged in
acts, transactions or courses of business that operated as a fraud or deceit upon offerees,
purchasers and prospective purchasers of the securities described herein.
PMI AND PALERMO VIOLATED THE FEDERAL SECURITIES LAWS

120. During the relevant period, Palermo owned, operated, and controlled PMI.

23

121. The PMI DFP promissory notes and PMI Garlo JV joint venture interests offered
and sold by Palermo to investors are securities within the meaning of both the Securities Act and
the Exchange Act.
122. In connection with the sales or offers to sell, PMI and Palermo made use of means
or instruments of interstate transportation or communication in interstate commerce or of the
mails, including using the internet, interstate phone calls, and the United States mail.  The
conduct described herein was in the offer or sale of securities and in connection with the
purchase or sale of securities.
123. The misrepresentations and omissions set forth herein, individually and in the
aggregate, are material.  A reasonable investor would have considered the misrepresented facts
and omitted information—including, among other items, misrepresentations about the safety and
security of the investments, the use of investor funds and the profitability of PMI investments—
important in deciding whether or not to purchase PMI DFP promissory notes or the PMI Garlo
joint venture interests.   Disclosure of the accurate facts would have altered the “total mix” of
information available to investors.
124. In connection with the conduct described herein, PMI and Palermo acted
knowingly and/or recklessly and negligently.
125. PMI and Palermo were makers of false and misleading statements made in writing
and orally regarding PMI.  Palermo prepared the offering documents, the PMI DFP promissory
notes and the PMI Garlo joint venture agreements provided to investors on behalf of PMI.
Palermo signed each of the promissory notes and joint venture agreements accepting the
investments.

24

126. Through their material misrepresentations and omissions, PMI and Palermo
obtained money or property from investors.
127. Through this scheme, PMI and Palermo each engaged in acts, transactions or
courses of business that operated as a fraud or deceit upon offerees, purchasers and prospective
purchasers of the promissory note and joint venture investments.
CLAIMS FOR RELIEF

FIRST CLAIM
Violations of Section 17(a) of the Securities Act

(Against All Defendants)
128. The Commission realleges and incorporates by reference each and every
allegation in paragraphs 1 through 127, inclusive, as if they were fully set forth herein.
129. By engaging in the conduct described above, Defendants ESM, Abundant, Wendt,
Costabile, PMI and Palermo in the offer or sale of securities, directly or indirectly, by the use of
any means or instruments of transportation or communication in interstate commerce or by use
of the mails:
a. knowingly or recklessly employed one or more devices, schemes, or artifices to
defraud;
b. knowingly, recklessly, or negligently obtained money or property by means of
one or more untrue statements of a material fact or an omissions of a material fact
necessary in order to make the statements made, in light of the circumstances
under which they were made, not misleading; or
c. knowingly, recklessly, or negligently engaged in transactions, practices, or
courses of business which operated or would operate as a fraud or deceit upon the
purchaser.

25

130. By engaging in the foregoing conduct, Defendants ESM, Abundant, Wendt,
Costabile, PMI and Palermo, directly or indirectly, singly or in concert, violated, and unless
enjoined will continue to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)].
SECOND CLAIM
Violations of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder

(Against All Defendants)
131. The Commission realleges and incorporates by reference each and every
allegation in paragraphs 1 through 127, inclusive, as if they were fully set forth herein.
132.  By engaging in the conduct described above, Defendants ESM, Abundant,
Wendt, Costabile, PMI and Palermo, directly or indirectly, singly or in concert, knowingly or
recklessly, in connection with the purchase or sale of securities and by the use of any means or
instrumentalities of interstate commerce, or the mails, or the facilities of a national securities
exchange:
a. employed one or more devices, schemes, or artifices to defraud;
b. made one or more untrue statements of material fact or omitted to state one or
more material facts necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading; or
c. engaged in one or more acts, practices, or courses of business which operated or
would operate as a fraud or deceit upon any person in connection with the
purchase or sale of any security.
133. By engaging in the foregoing conduct, Defendants ESM, Abundant, Wendt,
Costabile, PMI and Palermo, directly or indirectly, singly or in concert, violated, and unless
enjoined will continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and
Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].

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PRAYER FOR RELIEF
 WHEREFORE, the Commission respectfully requests that the Court enter a final
judgment:
I.
Permanently restraining and enjoining Defendants ESM, Abundant, Wendt, Costabile,
PMI and Palermo and their agents, servants, employees and attorneys and all persons in active
concert or participation with any of them from violating, directly or indirectly, Section 17(a) of
the Securities Act [15 U.S.C. § 77q(a)] and Section 10(b) of the Exchange Act [15 U.S.C.
§ 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5];
II.
Ordering Defendant Palermo to disgorge any and all ill-gotten gains derived from the
activities set forth in this Complaint, together with prejudgment interest thereon;

III.
Ordering Defendants Wendt, Costabile and Palermo to pay civil penalties under Section
20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d) of the Exchange Act [15
U.S.C. § 78u(d)]; and

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IV.
Granting such other and further relief as this Court may deem just and appropriate.
Respectfully submitted,

        s/ Julia C. Green
Date:  March 1, 2021     Julia C. Green
Jennifer Chun Barry
Kingdon Kase
Patricia A. Kuzma Trujillo

SECURITIES AND EXCHANGE COMMISSION
Philadelphia Regional Office
1617 JFK Blvd., Suite 520
 Philadelphia, PA 19103
 Telephone:  (215) 597-3100
 Facsimile:    (215) 597-2740
                                                            [email protected]

1 
 

UNITED STATES DISTRICT COURT 
WESTERN DISTRICT OF NEW YORK 

 
  
SECURITIES AND EXCHANGE 
COMMISSION, 

 

  
Plaintiff,             COMPLAINT 

     Case No. 
v. 
 

EARTHSOURCE MINERALS 
INTERNATIONAL, LLC, ABUNDANT 
RESOURCE DEVELOPMENT, LLLP,   
JASON M. WENDT, ARMANDO 
COSTABILE, PREMIER MINERALS 
INTERNATIONAL, LLC and MICHAEL J. 
PALERMO, 
 
                                                     Defendants. 
 

    
    JURY TRIAL DEMANDED 
 

   
 
 Plaintiff Securities and Exchange Commission (the “Commission”) alleges as follows 

against Defendants EarthSource Minerals International, LLC (“ESM”), Abundant Resource 

Development, LLLP (“Abundant”), Jason M. Wendt (“Wendt”), Armando Costabile 

(“Costabile”), Premier Minerals International, LLC (“PMI”) and Michael J. Palermo 

(“Palermo”): 

SUMMARY 

1. This case concerns two overlapping offering frauds involving the sale of 

investments related to gold and diamonds in Liberia in which defendants raised more than $5 

million from approximately 250 investors.  In soliciting these investments, Defendants misled 

investors about the safety and security of the investments, the use of investor funds, the extent of 

the companies’ assets and liabilities and the companies’ historical production and profitability.  

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2 
 

 

2. From at least September 2014 through December 2019, Wendt and Costabile, 

through their companies, ESM and Abundant, fraudulently induced at least 234 investors to 

purchase more than $4.7 million in securities, the proceeds of which were to be used to fund 

ESM’s mining business in Liberia.   

3. For example, in communications with prospective investors, Wendt and Costabile 

falsely stated that certain investments were “secured,” when they were not, and grossly 

underreported ESM’s liabilities, leading investors to believe that ESM owed only $100,000 when 

liabilities actually exceeded $4 million.  In one offering, ESM, Wendt and Costabile inflated the 

profits investors could expect by underreporting certain expenses, falsely claiming that ESM was 

required to pay royalties of 20% when, in fact, royalties were 55%. 

4. As part of the scheme, ESM, Abundant, Wendt and Costabile targeted Christian 

faith-based communities by, among other things, touting that ESM would allocate a percentage 

of profits to support humanitarian relief efforts in Liberia. 

5. From at least December 2015 through April 2018, Palermo, through his company, 

PMI, with the assistance of ESM, Wendt and Costabile, fraudulently induced 22 investors to 

purchase an additional $501,906 in PMI securities, the proceeds of which were purportedly to be 

invested in ESM’s mining business in Liberia.   

6. PMI and Palermo raised money for a diamond flipping program that they claimed 

to be running with ESM, claiming ESM would use the funds to purchase diamonds in Liberia for 

resale in Florida at a profit.  In fact, ESM could not export diamonds from Liberia at that time 

because ESM’s diamond dealer license had expired.  Palermo misled prospective investors in 

another ESM-related mining investment by falsely stating that ESM had obtained financing in 

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the seven figure range for the project and that mining production could commence within two 

months, when, in fact, ESM did not have an agreement for the purported financing. 

7. Instead of using investor funds as promised, Palermo misappropriated the 

majority of the money he raised through PMI.  Palermo used investor funds to pay rent on his 

home, personal automobile loan payments and for household expenses, travel and entertainment 

expenses for his family and frequent purchases at restaurants, grocery, convenience and 

department stores.  Palermo also used investor funds to repay prior investors purported interest 

or profits distributions. 

8. By engaging in the conduct described in this Complaint, Defendants ESM, 

Abundant, Wendt, Costabile, PMI and Palermo violated, and unless enjoined will continue to 

violate, Section 17(a) of the Securities Act of 1933 (“Securities Act”) [15 U.S.C. § 77q(a)] and 

Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. § 78j(b)] and 

Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].  

JURISDICTION AND VENUE 

9. The Commission brings this action pursuant to Sections 20(b) and 20(d) of the 

Securities Act [15 U.S.C. §§ 77t(b) and 77t(d)], and Section 21(d) of the Exchange Act [15 

U.S.C. § 78u(d)], to enjoin such acts, transactions, practices, and courses of business, and to 

obtain disgorgement, prejudgment interest, civil penalties, and such other and further relief as the 

Court may deem just and appropriate. 

10. This Court has jurisdiction over this action pursuant to Sections 20(b) and 22(a) 

of the Securities Act [15 U.S.C. §§ 77t(b) and 77v(a)] and Sections 21(d), 21(e) and 27 of the 

Exchange Act [15 U.S.C. §§ 78u(d), 78u(e) and 78aa]. 

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11. Venue in this District is proper pursuant to Section 22(a) of the Securities Act [15 

U.S.C. § 77v(a)] and Section 27 of the Exchange Act [15 U.S.C. § 78aa].  Among other things, 

certain of the acts, transactions, practices, and courses of business constituting the violations 

alleged herein occurred within the Western District of New York.  In addition, Wendt and 

Costabile reside in this District, this District is the principal place of business for Abundant, the 

principal U.S. business office of ESM is located in this District and Wendt, Costabile, Palermo 

and PMI transact business in this District.   

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

indirectly, singly or in concert, made use of the means or instruments of transportation or 

communication in, or instrumentalities of, interstate commerce, or the mails, or the facilities of a 

national securities exchange. 

DEFENDANTS 

13. ESM is a Wyoming limited liability company with its principal place of business 

in Monrovia, Liberia, and its principal U.S. office in Wendt’s home in Hilton, New York. 

14. Abundant is a Wyoming limited liability limited partnership with its principal 

place of business in Hilton, New York.  Abundant is controlled by Wendt and Costabile through 

its general partner, which is owned and controlled by Wendt and Costabile. 

15. Wendt, age 50, resides in Hilton, New York. Wendt has been the President of 

Defendant ESM and the President of the general partner of Defendant Abundant since their 

formation in August 2012 and August 2011, respectively.   

16. Costabile, age 44, resides in Fairport, New York. Costabile has been Secretary 

and Director of ESM and the Secretary and Director of the general partner of Defendant 

Abundant since their formation in August 2012 and August 2011, respectively. 

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17. PMI is a Florida limited liability company, with its principal place of business in 

the home of Palermo, formerly in Safety Harbor, Florida and currently in Tarpon Springs, 

Florida. 

18. Palermo, age 46, resides in Tarpon Springs, Florida. Palermo has been the sole 

Manager of PMI since its formation in October 2015 and became Chief Investment Officer of 

ESM in 2016. 

FACTS 

19. Wendt and Costabile formed Abundant in August 2011, in order to raise funds for 

a gold mining operation in Liberia. Wendt and Costabile formed ESM in August 2012 to serve as 

the principal U.S. business office for their mining operation in Liberia.   

20. Palermo formed PMI in October 2015 purportedly as an investment group that 

would joint venture with ESM, with PMI providing investor funds to ESM, which purportedly 

would be used by ESM, Wendt and Costabile to generate returns for PMI investors. 

21. At all relevant times, PMI acted by and through Palermo. 

THE ESM AND ABUNDANT OFFERING FRAUD 

22. From at least September 2014 through December 2019, ESM, Abundant, Wendt 

and Costabile fraudulently induced at least 234 investors, located in multiple states, including 

New York, Pennsylvania and Florida to purchase at least $4.7 million in securities by making 

numerous material misstatements regarding the safety and security of the investments, the use of 

investor funds, the extent of ESM’s assets and liabilities and ESM’s historical production and 

profitability. 

23. In order to raise money to fund ESM’s mining operations, Wendt and Costabile 

sold investments in three different investment programs: (1) the ESM Diamond Flipping 

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Program (“ESM DFP”); (2) the Abundant Limited Liability Limited Partnership; and (3) the 

ESM Garlo Joint Venture (“ESM Garlo JV”). 

24. Wendt and Costabile marketed the securities in telephone calls, electronic mail 

and face-to-face meetings with prospective investors, targeting Christian faith-based 

communities. Wendt and Costabile conducted investor meetings at churches and encouraged new 

investments during telephone and web-conference meetings during which they prayed for the 

success of ESM’s mining endeavors while touting that a portion of ESM’s profits would be used 

for humanitarian relief in Liberia. Wendt and Costabile told prospective investors that 

investments with ESM and Abundant would aid development in Liberia while providing high 

rates of returns to investors.  Many of the investors were financially unsophisticated with limited 

investment experience.  Some investors purchased securities in two or more of the investment 

programs. 

25. Wendt and Costabile disregarded corporate formalities.  While they maintained 

multiple bank accounts for ESM and Abundant, they often deposited investor funds intended for 

one entity into the account of another entity.  Wendt and Costabile repeatedly moved funds 

through various accounts they controlled and comingled investor funds for the ESM DFP with 

the investor funds raised for ESM’s mining operations through Abundant. 

A.  ESM Diamond Flipping Program 

i. Wendt, Costabile and ESM Sold Over $1 Million in Investments in the ESM 
DFP 

 
26. Between September 2014 and September 2015, ESM, Wendt and Costabile sold 

$1,020,550 in securities to at least 30 investors for the ESM DFP. 

27. The securities that Wendt and Costabile sold to investors for the ESM DFP took 

the form of “loan agreements,” in which Wendt, Costabile and ESM promised investors that they 

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7 
 

would receive monthly interest payments of 10% and the return of their principal within two to 

four months.  The loan agreements also provided investors with the option of reinvesting their 

accrued interest as principal and of extending the term of the loan so they could continue to 

accrue interest. 

28. Wendt and Costabile solicited investors to purchase the ESM DFP securities 

using a set of written offering documents that they authored together.  The offering documents 

referred to the loan agreements as a “speculative venture,” and a spreadsheet provided to each 

ESM DFP investor identified the principal amount of the loan as the “total amount invested.” 

29. In the offering documents, ESM, Wendt and Costabile told prospective investors 

that investor funds would be used to purchase diamonds in Liberia that would be exported to the 

United States for resale, which purportedly would generate sufficient profits to both pay the 

monthly interest payments to ESM DFP investors and create an additional income stream for 

ESM’s mining operations. 

30. ESM DFP investors made payments of money to ESM and, in exchange, received 

a loan agreement signed by Wendt on behalf of ESM.     

31. Some ESM DFP investors wired their purchase payments directly to ESM’s bank 

accounts controlled by Wendt and Costabile.  Others sent their payments to ESM through the 

mail or by hand-delivery. 

ii. Wendt, Costabile and ESM Misled ESM DFP Investors  

32. ESM, Wendt and Costabile made material misrepresentations to ESM DFP 

investors relating to the safety and security of ESM DFP investments and the use of investor 

funds. 

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8 
 

33. In written offering documents distributed to prospective investors to induce them 

to invest in the ESM DFP, Defendants ESM, Wendt and Costabile falsely stated that: 

a. the investments in the ESM DFP were “secured” and that the minimum cash 

value of the investments “will always be maintained as cash in the program’s 

bank account or in the form of diamond assets”; and 

b. the ESM DFP would generate sufficient cash flow to provide both “a great return” 

to the ESM DFP investors of “10% interest per month” and “for ongoing ESM 

operations and equipment purchases” and that “all proceeds from this program are 

first allocated to the payment of interest and final payout of principal per” the 

ESM DFP loan agreement. 

34. Contrary to the representations in the offering materials, the ESM DFP did not 

operate or perform as claimed. 

35. Wendt and Costabile also did not segregate ESM DFP funds from ESM’s other 

operating accounts as promised.  ESM actually used only a portion of the money invested in the 

ESM DFP to purchase diamonds.  From the outset, Wendt and Costabile siphoned some of the 

ESM DFP investor money out of the program and used it—not profits—to fund ESM’s other 

mining operations.  

36. For example, during the first two months the ESM DFP operated, ESM raised 

over $590,000 from investors. Of that amount, ESM, Wendt and Costabile used only $390,900 to 

purchase diamonds. The remainder was spent on other expenses for ESM’s mining operations.  

37. Moreover, ESM, Wendt and Costabile actually lost money on the diamond 

flipping transactions they did undertake. While ESM purchased $390,900 in diamonds between 

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9 
 

September and October of 2014, ESM received less than $316,000 from its diamond broker in 

Florida when it resold those diamonds.  None of this was disclosed to investors. 

38. Despite these losses, Wendt and Costabile encouraged investors to let their 

investments roll over beyond the two to four months referenced in the loan agreement, so they 

could continue accruing interest. In emails signed by both men, Wendt and Costabile told 

investors that ESM had conducted diamond flips, and they sent updated spreadsheets to the 

investors indicating that their ESM DFP investments had accrued 10% interest each month from 

the diamond flipping transactions. 

39. ESM, Wendt and Costabile continued operating the ESM DFP until December 

2015 only because of the influx of new ESM DFP investments and most investors agreed to roll 

over their investments based on ESM’s promise they could continue earning 10% monthly 

interest. 

40. Wendt and Costabile knew that ESM failed to invest much of the DFP 

investments as promised and lost money on the diamond flipping transactions they did 

undertake, and had no reasonable basis to claim that the ESM DFP could generate the promised 

10% monthly return. 

41. By December 2015, the ESM DFP was insolvent. Wendt and Costabile used the 

proceeds from the last diamond flip on mining operations and to make interest payments to a few 

investors, however, ESM still owed over $995,000 in principal and $2.2 million in interest to the 

ESM DFP investors that ESM could not repay. 

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B.  Abundant Limited Liability Limited Partnership 

i. Wendt, Costabile and Abundant Sold Over $500,000 in Investments in 
Abundant Since January 2016 

 
42. Wendt and Costabile began raising money for ESM through Abundant in 2013.  

At that time, ESM had six general partners, including Wendt and Costabile.  In early January 

2016, the other four general partners officially separated from ESM with Wendt and Costabile 

maintaining control of ESM. 

43. By January 2016, ESM had spent all of the money it had previously raised 

through the ESM DFP and Abundant. Wendt and Costabile began seeking new investments 

through Abundant for ESM. 

44. Between January 2016 and December 2016, Wendt and Costabile, through 

Abundant, offered and sold securities totaling at least $559,000 to at least 105 investors. 

45. Abundant, Wendt and Costabile told prospective investors that Abundant had a 

40% ownership interest in ESM and that their investments in Abundant would be used to fund 

ESM’s mining operations in Liberia. 

46. The securities that Wendt and Costabile sold to investors in Abundant took the 

form of limited liability limited partnership interests.  Wendt, Costabile and Abundant promised 

limited partner investors that they would receive a pro rata distribution of the profits Abundant 

received from ESM’s mining operation.  

47. Wendt and Costabile solicited investors at in-person meetings and by sending 

email about the company to prospective investors. 

48. Wendt and Costabile also solicited investors to purchase the Abundant securities 

using a set of written offering documents that they authored together.  The offering documents 

referred to each limited partner’s capital contribution as “investment capital” and the purchase 

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agreement for the limited partnership interest referred to Abundant as a “speculative venture” 

and contained certain financial disclosures regarding the company. 

49. Abundant investors made payments of money to Abundant and, in exchange, 

received a purchase agreement signed by Wendt on behalf of the general partner of Abundant.     

50. Some Abundant investors wired their purchase payments directly to Abundant’s 

bank accounts, which are controlled by Wendt and Costabile.  Others sent their payments to 

Abundant through the mail or by hand-delivery. 

ii. Wendt, Costabile and Abundant Misled Abundant Investors  
 
51. Abundant, Wendt and Costabile misled Abundant investors about the extent of 

ESM’s outstanding liabilities and assets after the partner separation, ESM’s historical mining 

production rates, and the profitability of the ESM DFP. 

52. At an investor meeting on January 22, 2016, Wendt falsely stated that at the time 

of the partner separation in January 2016, ESM had only $200,000 in liabilities, which ESM split 

evenly with the separating partners, and that ESM oftentimes generated $200,000 per month 

from its gold mining operation. 

53. Similarly, a January 25, 2016 email to prospective investors, which was sent by 

Wendt and signed by Wendt and Costabile, falsely stated that at the time of the partner 

separation, ESM’s liabilities were split evenly with the separating partners and that the gold 

mining operation had covered all of ESM’s operating expenses.     

54. Contrary to the representations made by Wendt at the January 2016 investor 

meeting and in the January 2016 email authored by Wendt and Costabile, at the time of the 

partner separation, ESM had outstanding liabilities of over $4.3 million and the separating 

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partners assumed responsibility for only $200,000 of ESM’s outstanding liabilities, leaving ESM 

with responsibility for the remainder of more than $4 million. 

55. Also contrary to Wendt’s representations at the January 2016 investor meeting 

and the January 2016 email authored by Wendt and Costabile, ESM did not ever—let alone 

often—generate $200,000 per month from its gold mining operation and the gold mining revenue 

did not cover ESM’s operating expenses. In fact, ESM’s total annual gold production in 2015 

was less than $100,000. 

56. Written offering documents authored by Wendt and Costabile for Abundant and 

distributed to prospective investors to induce them to invest in Abundant, also falsely stated that: 

a. ESM had infrastructure worth $11 million; and 

b. the ESM DFP had great short term results and was one of the best things ESM 

ever did. 

57. Contrary to these representations, ESM did not have infrastructure worth $11 

million after the partner separation. ESM’s financial statements reflected that ESM had current 

and fixed assets of only $1.1 million after the partner separation. 

58. Furthermore, ESM did not have great short term results with the ESM DFP, but 

actually lost money on its diamond flipping transactions. 

59. Wendt and Costabile knew that their representations on behalf of Abundant 

regarding ESM’s outstanding liabilities at the time of the partner separation, its historical mining 

production rates, the value of its infrastructure assets and the profitability of the ESM DFP were 

false. 

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C.  ESM Garlo Joint Venture 

i. Wendt, Costabile and ESM Sold over $3.1 Million in Investments in the ESM 
Garlo Joint Venture 

 
60. Between January 2017 and December 2019, ESM, Wendt and Costabile sold at 

least $3,140,000 in securities to at least 158 investors for the ESM Garlo JV. 

61. The securities that ESM, Wendt and Costabile sold to investors for the ESM 

Garlo JV took the form of joint venture interests.   

62. Wendt and Costabile solicited investors to purchase the ESM Garlo JV securities 

using a set of written offering documents that they authored together for ESM.  The offering 

documents referred to each joint venture investor’s capital contribution as “investment capital.” 

63. The offering documents told prospective joint venture investors that their 

investments would be used to fund ESM’s mining operations in Liberia at ESM mining sites 

along the Garlo river. 

64. The offering documents provided that investors would receive 20% of the 

principal balance of their investment every 30 days when mining production commenced at the 

Garlo site, until they recovered their principal investment plus 100% profit. 

65. ESM Garlo JV investors made payments of money to ESM and, in exchange, 

received an ESM Garlo Joint Venture Agreement signed by Wendt on behalf of ESM.     

66. Some ESM Garlo JV investors wired their purchase payments directly to ESM 

bank accounts controlled by Wendt and Costabile.  Others sent their payments to ESM through 

the mail or by hand-delivery.  

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ii. Wendt, Costabile and ESM Misled Garlo JV Investors  
 

67. The ESM Garlo JV offering documents, which Wendt and Costabile prepared and 

provided to prospective investors, provided misleading information about ESM’s expenses and 

unreasonable profit projections.   

68. The offering documents stated that ESM could generate monthly revenues of 

$2,790,000 in gold and diamonds with monthly expenses of $921,700 resulting in monthly 

profits of $1,868,300. 

69. These projections were substantially inflated because they were based on vastly 

understating royalties that ESM was required to pay to the Garlo site owner.  The offering 

documents falsely claimed that ESM was required to pay royalties at a rate of only 20% of 

revenue when, in fact, ESM was obligated to pay royalties of 55% to the site owner.  

70. The projections also failed to include substantial expenses incurred by ESM 

including salary payments made to Wendt, travel expenses for ESM staff who resided in the U.S. 

and travelled to and from Liberia, diamond export taxes imposed by the Liberian government 

and other overhead expenses. 

71. Wendt and Costabile knew that their representations regarding the amount of 

royalties owed to the Garlo site owner were false and that they failed to include other expenses 

incurred by ESM, all of which had the effect of falsely inflating their profit projections for the 

ESM Garlo JV. 

THE PMI OFFERING FRAUD 

72. From at least December 2015 through April 2018, PMI and Palermo, with the 

assistance of ESM, Wendt and Costabile, fraudulently induced at least 22 investors to purchase 

at least $501,906 in securities by making material misstatements and omissions regarding the 

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safety and security of the PMI investments, the use of PMI investor funds and the profitability of 

PMI investments. 

73.  Palermo sold investments in two different investment schemes: (1) the PMI 

Diamond Flipping Program (“PMI DFP”); and (2) the PMI Garlo Joint Venture (“PMI Garlo 

JV”). 

74. PMI and Palermo marketed the securities in telephone calls, electronic mail, 

telephone and web conferences and face-to-face meetings with prospective investors.  Many of 

the investors were financially unsophisticated with limited investment experience. 

A. PMI DFP 

i. Palermo and PMI Sold Over $250,000 in Investments in the PMI DFP 

75. Between December 2015 and December 2016, PMI and Palermo sold at least 

$258,360 in securities to at least 14 investors through the PMI DFP offering. 

76. The securities that Palermo sold to investors in connection with the PMI DFP 

took the form of promissory notes, in which PMI promised investors that they would receive 

20% interest on the amount of their investment as well as the return of their principal within 

three months. 

77. PMI and Palermo solicited investors to purchase the securities using written 

offering documents and newsletters that Palermo authored and emailed to prospective investors.  

The offering documents referred to the promissory notes as an “investment opportunity,” and 

described PMI’s diamond flipping program and the proposed terms of the offering.   

78. PMI and Palermo told prospective investors that their investments would be used 

by ESM for the purpose of purchasing diamonds in Liberia, which would be exported to Florida 

for resale at a profit. 

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79. PMI and Palermo stated in the offering documents and the newsletters that 

investors would receive quarterly interest payments of 20% of their principal investment and 

referred to those interest payments as “profit payouts.” 

80. Investors made payments of money to PMI and, in exchange, received a 

promissory note signed by Palermo on behalf of PMI.     

81. Some investors wired their purchase payments directly to a PMI bank account 

controlled by Palermo.  Others sent their payments to Palermo through the mail or by hand-

delivery. 

82. Palermo frequently moved investor funds from PMI’s account to his own personal 

account commingling investor funds with the assets in his personal account.  

ii. Palermo, Wendt, Costabile and PMI Misled PMI DFP Investors  

83. Contrary to the representations in the offering materials, when Palermo and PMI 

were soliciting investments for the PMI DFP, PMI could not operate the diamond flipping 

program with ESM because ESM’s diamond dealer license had expired in October 2015.  ESM 

did not renew its diamond dealer license at any time during 2016.  Without a diamond dealer 

license issued by the Liberian government, ESM could not export diamonds from Liberia and 

ESM could not generate profits for investors through diamond flipping transactions. 

84. Moreover, contrary to PMI’s and Palermo’s representations that the PMI DFP 

investor funds would be used by ESM to purchase diamonds for the purported diamond flipping 

program, Palermo actually sent very little money to ESM. Instead, Palermo misappropriated the 

majority of the PMI DFP investor funds for his personal use and used a portion of the investor 

funds to make interest payments to prior PMI DFP investors. 

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85. In telephone conferences with prospective investors, Palermo, Wendt and 

Costabile also made oral misrepresentations to prospective investors to induce them to invest in 

the PMI DFP.  For example: 

a. During a February 2016 telephone conference, Palermo falsely stated that 

ESM’s export of diamonds was safe and secure because ESM had 

obtained a $500,000 insurance policy from Lloyd’s of London covering its 

diamond exports; 

b. During a February 2016 telephone conference, Wendt falsely stated that 

ESM generated a 52% net profit margin on the diamond transactions in the 

prior ESM DFP; and 

c. During a November 2016 telephone conference, Costabile falsely stated 

that the PMI DFP investment was “safe” because the capital “within the 

program is either always with us in the form of the liquid capital or the 

value of the stones.” 

86. Contrary to Palermo’s oral representations, ESM did not obtain a $500,000 

insurance policy from Lloyd’s of London for its export of diamonds. 

87. Palermo knew that ESM did not actually obtain the insurance policy. Palermo was 

the person who worked on behalf of ESM in late 2015 and early 2016 trying to obtain insurance 

coverage for ESM’s diamond exports, he knew that ESM had not implemented security measures 

required by the insurance broker and he knew that ESM did not obtain the insurance policy. 

88. Contrary to Wendt’s oral representations to prospective PMI DFP investors, ESM 

did not earn a 52% net profit margin on its prior diamond flipping transactions. Instead, ESM 

actually lost money on its diamond flipping transactions through the ESM DFP. 

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89. Wendt knew that ESM had lost money on its ESM DFP and that ESM did not 

have a 52% net profit margin on its diamond flipping transactions. 

90. Contrary to Costabile’s oral representations to prospective PMI DFP investors, 

PMI DFP investments were not safe and were not secured by diamonds purchased by ESM. 

91. Costabile knew that, in reality, ESM used only a portion of the money invested in 

the ESM DFP to purchase diamonds and that ESM, Wendt and Costabile had siphoned some of 

the ESM DFP investor money out of the program and used it cover mining operational expenses. 

92. Palermo encouraged PMI DFP investors to let their investments roll over beyond 

the three months referenced in the promissory notes, so they could continue accruing interest. 

Palermo told investors in emails that ESM had conducted diamond flips for PMI and that PMI 

had paid out 20% profits at quarterly intervals during 2016.  These statements were false.  

93. In addition, Wendt played a further role in the fraud by participating in roundtrip 

transactions with PMI DFP investor funds. In particular, Palermo sent a small portion of the PMI 

DFP investor funds to ESM, and Wendt promptly returned those same funds to PMI ostensibly 

for PMI “DFP Payouts”, which created the illusion that ESM was generating profits from 

diamond flipping transactions, when in fact, no diamond flipping transactions had occurred. 

B. PMI Garlo JV 

i. Palermo and PMI Sold Over $240,000 in Investments in the PMI Garlo JV 

94. Between January 2017 and April 2018, PMI sold at least $243,546 in securities to 

at least 9 investors for the PMI Garlo JV. 

95. The securities that PMI and Palermo sold to investors for the PMI Garlo JV took 

the form of joint venture interests.   

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96. Palermo solicited investors to purchase the PMI Garlo JV securities using a series 

of written newsletters that Palermo authored.  The newsletters referred to joint venture 

participants as “investors” and contributions by joint venture participants as “investor capital.” 

97. In the newsletters, PMI and Palermo told prospective joint venture investors that 

they would have a joint venture interest in ESM’s Garlo mining site through an investment in 

PMI.  PMI and Palermo claimed that PMI Garlo JV investments would be used for the purpose 

of funding ESM’s mining operations in Liberia at ESM mining sites along the Garlo river.   

98. PMI and Palermo promised PMI Garlo JV investors that when ESM commenced 

mining production at mining sites along the Garlo river they would receive 20% of the principal 

balance of their investment every 30 days. 

99. PMI Garlo JV investors made payments of money to PMI and, in exchange, 

received a PMI Garlo Joint Venture Agreement signed by Palermo on behalf of PMI.     

100. Some PMI Garlo JV investors wired their purchase payments directly to PMI 

bank accounts controlled by Palermo.  Others sent their payments to PMI through the mail or by 

hand-delivery. 

ii. Palermo and PMI Misled PMI Garlo JV Investors 

101. Contrary to the representations about how PMI Garlo JV investor funds would be 

used, Palermo actually invested only a portion of the money that he raised through the sale of 

PMI Garlo JV securities with ESM.  Instead, as discussed in greater detail below, Palermo 

misappropriated the majority of the investor funds for his personal use and used some investor 

funds to make interest payments to prior PMI investors. 

102. In addition, Palermo misled investors about the operation of the ESM Garlo site.  

In a December 2017 newsletter/email, Palermo falsely stated that ESM had obtained financing in 

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the seven figure range that would allow ESM’s Garlo site to become fully mechanized and 

mining production could commence within two months. 

103. Contrary to Palermo’s representations, ESM did not have a signed agreement for 

seven figure financing for the Garlo mining site. In fact, ESM never obtained an agreement for 

financing in the seven figure range. 

104. Palermo knew that ESM did not have a signed agreement for additional financing 

and that full mechanized mining production at Garlo could not commence within 2 months. 

C. Palermo Misused Investor Funds 

105. PMI and Palermo claimed in written offering documents and newsletters that 

investor funds for the PMI DFP would be used for the purchase of diamonds for diamond 

flipping transactions and that investor funds for the PMI Garlo JV would be used to fund ESM’s 

operations at mining sites along the Garlo river.   

106. Palermo also made oral representations to investors and prospective investors that 

PMI DFP investments would be used to purchase diamonds for diamond flipping transactions 

and that PMI Garlo JV investments would be used to fund ESM’s mining operations along the 

Garlo river.  

107. Contrary to what investors were told in writing and orally, Palermo used the 

majority of investor funds in ways not disclosed to investors.   

108. For instance, without disclosing it to investors, Palermo misappropriated 

$340,005 of investor funds to benefit himself and his family.   

109. Palermo used investor funds to pay his personal expenses, including, among other 

things, the rent on his home, personal automobile loan payments, household expenses, travel and 

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entertainment expenses for his family and frequent purchases at restaurants, grocery, 

convenience and department stores.   

110. Palermo also spent $80,623 to make purported interest or profit payments to prior 

investors.  These payments were made to further the fraud by maintaining the appearance that 

PMI’s business was performing as represented. 

111. PMI and Palermo did not disclose to investors that they planned to, or did in fact, 

use investor money for Palermo’s personal benefit, or that they used money from new investors 

to repay earlier investors. 

ESM, ABUNDANT, WENDT AND COSTABILE VIOLATED THE FEDERAL 
SECURITIES LAWS 

 
112. During the relevant period, Wendt and Costabile owned, operated, and controlled 

ESM and Abundant. 

113. The ESM DFP loan agreements, Abundant limited liability limited partnership 

interests and ESM Garlo JV joint venture interests offered and sold to investors are securities 

within the meaning of both the Securities Act and the Exchange Act. 

114. In connection with the sales or offers to sell securities, ESM, Abundant, Wendt 

and Costabile made use of means or instruments of interstate transportation or communication in 

interstate commerce or of the mails, including using the internet, interstate phone calls, and the 

United States mail. The conduct described herein was in the offer or sale of securities and in 

connection with the purchase or sale of securities.   

115. The misrepresentations and omissions set forth herein, individually and in the 

aggregate, are material.  A reasonable investor would have considered the misrepresented facts 

and omitted information—including, among other items, misrepresentations about the safety and 

security of the investments, the use of investor funds, the extent of the companies’ assets and 

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liabilities and the companies’ historical production and profitability—important in deciding 

whether or not to purchase ESM DFP loan agreements, Abundant limited liability limited 

partnership interests and the ESM Garlo joint venture interests. Disclosure of the accurate facts 

or omitted information would have altered the “total mix” of information available to investors. 

116. In connection with the conduct described herein, ESM, Abundant, Wendt and 

Costabile acted knowingly and/or recklessly and negligently.   

117. ESM, Abundant, Wendt and Costabile were each makers of false and misleading 

statements made in writing and orally regarding ESM and Abundant.  Wendt and Costabile 

prepared the offering documents, the ESM DFP loan agreements, the Abundant purchase 

agreements and the ESM Garlo Joint Venture agreements provided to investors on behalf of 

ESM and Abundant. Wendt signed each of the loan agreements, purchase agreements and joint 

venture agreements accepting the investments. Wendt and Costabile also were makers of the 

false and misleading statements made orally regarding the PMI DFP. 

118. Through their material misrepresentations and omissions, ESM, Abundant, Wendt 

and Costabile each obtained money or property from investors.   

119. Through this scheme, ESM, Abundant, Wendt and Costabile each engaged in 

acts, transactions or courses of business that operated as a fraud or deceit upon offerees, 

purchasers and prospective purchasers of the securities described herein. 

PMI AND PALERMO VIOLATED THE FEDERAL SECURITIES LAWS 
 

120. During the relevant period, Palermo owned, operated, and controlled PMI. 

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121. The PMI DFP promissory notes and PMI Garlo JV joint venture interests offered 

and sold by Palermo to investors are securities within the meaning of both the Securities Act and 

the Exchange Act. 

122. In connection with the sales or offers to sell, PMI and Palermo made use of means 

or instruments of interstate transportation or communication in interstate commerce or of the 

mails, including using the internet, interstate phone calls, and the United States mail.  The 

conduct described herein was in the offer or sale of securities and in connection with the 

purchase or sale of securities.   

123. The misrepresentations and omissions set forth herein, individually and in the 

aggregate, are material.  A reasonable investor would have considered the misrepresented facts 

and omitted information—including, among other items, misrepresentations about the safety and 

security of the investments, the use of investor funds and the profitability of PMI investments—

important in deciding whether or not to purchase PMI DFP promissory notes or the PMI Garlo 

joint venture interests.   Disclosure of the accurate facts would have altered the “total mix” of 

information available to investors. 

124. In connection with the conduct described herein, PMI and Palermo acted 

knowingly and/or recklessly and negligently.   

125. PMI and Palermo were makers of false and misleading statements made in writing 

and orally regarding PMI.  Palermo prepared the offering documents, the PMI DFP promissory 

notes and the PMI Garlo joint venture agreements provided to investors on behalf of PMI.  

Palermo signed each of the promissory notes and joint venture agreements accepting the 

investments. 

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126. Through their material misrepresentations and omissions, PMI and Palermo 

obtained money or property from investors.   

127. Through this scheme, PMI and Palermo each engaged in acts, transactions or 

courses of business that operated as a fraud or deceit upon offerees, purchasers and prospective 

purchasers of the promissory note and joint venture investments. 

CLAIMS FOR RELIEF 
 

FIRST CLAIM 
Violations of Section 17(a) of the Securities Act 

 
(Against All Defendants) 

128. The Commission realleges and incorporates by reference each and every 

allegation in paragraphs 1 through 127, inclusive, as if they were fully set forth herein.  

129. By engaging in the conduct described above, Defendants ESM, Abundant, Wendt, 

Costabile, PMI and Palermo in the offer or sale of securities, directly or indirectly, by the use of 

any means or instruments of transportation or communication in interstate commerce or by use 

of the mails: 

a. knowingly or recklessly employed one or more devices, schemes, or artifices to 

defraud; 

b. knowingly, recklessly, or negligently obtained money or property by means of 

one or more untrue statements of a material fact or an omissions of a material fact 

necessary in order to make the statements made, in light of the circumstances 

under which they were made, not misleading; or 

c. knowingly, recklessly, or negligently engaged in transactions, practices, or 

courses of business which operated or would operate as a fraud or deceit upon the 

purchaser. 

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130. By engaging in the foregoing conduct, Defendants ESM, Abundant, Wendt, 

Costabile, PMI and Palermo, directly or indirectly, singly or in concert, violated, and unless 

enjoined will continue to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]. 

SECOND CLAIM 
Violations of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder 

 
(Against All Defendants) 

131. The Commission realleges and incorporates by reference each and every 

allegation in paragraphs 1 through 127, inclusive, as if they were fully set forth herein.  

132.  By engaging in the conduct described above, Defendants ESM, Abundant, 

Wendt, Costabile, PMI and Palermo, directly or indirectly, singly or in concert, knowingly or 

recklessly, in connection with the purchase or sale of securities and by the use of any means or 

instrumentalities of interstate commerce, or the mails, or the facilities of a national securities 

exchange:   

a. employed one or more devices, schemes, or artifices to defraud; 

b. made one or more untrue statements of material fact or omitted to state one or 

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

circumstances under which they were made, not misleading; or 

c. engaged in one or more acts, practices, or courses of business which operated or 

would operate as a fraud or deceit upon any person in connection with the 

purchase or sale of any security.  

133. By engaging in the foregoing conduct, Defendants ESM, Abundant, Wendt, 

Costabile, PMI and Palermo, directly or indirectly, singly or in concert, violated, and unless 

enjoined will continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and 

Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].   

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PRAYER FOR RELIEF 

 WHEREFORE, the Commission respectfully requests that the Court enter a final 

judgment: 

I. 

Permanently restraining and enjoining Defendants ESM, Abundant, Wendt, Costabile, 

PMI and Palermo and their agents, servants, employees and attorneys and all persons in active 

concert or participation with any of them from violating, directly or indirectly, Section 17(a) of 

the Securities Act [15 U.S.C. § 77q(a)] and Section 10(b) of the Exchange Act [15 U.S.C. 

§ 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5]; 

II. 

Ordering Defendant Palermo to disgorge any and all ill-gotten gains derived from the 

activities set forth in this Complaint, together with prejudgment interest thereon; 

III. 

Ordering Defendants Wendt, Costabile and Palermo to pay civil penalties under Section 

20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d) of the Exchange Act [15 

U.S.C. § 78u(d)]; and 

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IV. 

Granting such other and further relief as this Court may deem just and appropriate. 

Respectfully submitted, 

 
             
        s/ Julia C. Green    

Date:  March 1, 2021    Julia C. Green 
Jennifer Chun Barry 
Kingdon Kase 
Patricia A. Kuzma Trujillo 
 
SECURITIES AND EXCHANGE COMMISSION 
Philadelphia Regional Office 
1617 JFK Blvd., Suite 520 

 Philadelphia, PA 19103 
 Telephone:  (215) 597-3100 
 Facsimile:    (215) 597-2740 
 [email protected] 

 

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