SEC v. TIMOTHY J. COUGHLIN; OICU LTD.; OICU INVESTMENTS CORP.; AMERICAN QUALITY CLEANING SERVICES, INC.; and AVOCALON, LLC, No. 1:14-cv-00562-WTL, District of Columbia (Apr. 11, 2014) — Complaint

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Counsel of Record:
Stephan J. Schlegelmilch
Bridget M. Fitzpatrick
C. Joshua Felker
Adam J. Eisner
Carolyn Kurr
U.S.
 SECURITIES AND EXCHANGE COMMISSION
100 F. Street, N.E.
Washington, DC 20549
Telephone: (202) 551-4935 (Schlegelmilch)
Facsimile: (202) 551-4935 (Schlegelmilch)
[email protected]

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION

__________________________________________
:
UNITED STATES SECURITIES AND   :
EXCHANGE COMMISSION    :
:
  Plaintiff,     :
:
  vs.     : Civil No.  1:14-cv-562
       :
TIMOTHY J. COUGHLIN, OICU LTD., and :
OICU INVESTMENTS CORP. (both d/b/a :
“Oxford International Credit Union” and/or :
 “Oxford International Cooperative Union”),  : Jury Trial Demanded
       :
  Defendants, and   :
       :
AMERICAN QUALITY CLEANING  :
SERVICES, INC. (d/b/a “Oxford Privacy    :
Group”), and AVOCALON, LLC,   :
       :
  Relief Defendants.   :
_________________________________________ :

COMPLAINT

Plaintiff United States Securities and Exchange Commission (the “Commission”), for its
Complaint against Defendants Timothy J. Coughlin (“Coughlin”), OICU Ltd. and OICU

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Investments Corp. (both d/b/a “Oxford International Credit Union or “Oxford International
Cooperative Union”),  alleges as follows:
SUMMARY
1. The defendants operated a fraudulent securities offering in which investors
deposited their funds in an Internet-based, supposedly offshore, “international credit union”
called Oxford International Credit Union.  In reality, the defendants were conducting a Ponzi
scheme.  As a result of the defendants’ conduct, thousands of investors collectively suffered
millions of dollars in losses.
2. Between June 2007 and December 2009, using the website www.oxfordicu.com,
Coughlin and Oxford International Credit Union collected deposits from more than 5,000
investors exceeding $12.8 million dollars.  Beginning in December 2008, Coughlin began
operating a successor to Oxford International Credit Union, called Oxford International
Cooperative Union, using the website www.oxfordprivacygroup.com.
3. Defendants defrauded investors into believing that the money they deposited into
their Oxford International Credit Union and Oxford International Cooperative Union accounts
would be pooled with other investors’ funds and invested by Coughlin in high-yield investments
on behalf of all members.  The credit union, however, was a fiction, and the defendants did not
actually make investments with the members’ deposits sufficient to generate the returns they
boasted.
4. Instead, to facilitate and further the fraud, the defendants posted false information
to members’ online accounts to create the appearance that their deposits were earning exorbitant
daily investment returns.  The Oxford International Credit Union website, for example, showed
investors that their deposits were purportedly earning investment returns that averaged, during

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the January 2007 through December 2009 period, 0.471% compounded daily.   Oxford
International Cooperative Union’s website also boasted bogus investment returns from its
inception in late 2008 through December 2011.
5. Coughlin and Oxford International Credit Union also falsely claimed that member
accounts were insured by a private insurance company.  Coughlin posted documents to the
Oxford International Credit Union website purporting to evidence an insurance policy and
payment of the policy premium.  The documents, however, were fakes.
6. As part of the scheme, Coughlin posted written and audio messages to the Oxford
International Cooperative Union website in which he made materially false statements to
investors about his successes in managing the entity’s investments and the status of their
accounts.
7. As a result of Coughlin’s supposed successes in managing their investments,
many people deposited more money into their Oxford International Credit Union and Oxford
International Cooperative Union accounts, and investors encouraged friends, relatives and others
to deposit money in the entities, as well.
8. Coughlin misappropriated at least $5.97 million from Oxford International Credit
Union and Oxford International Cooperative Union members, using investor money for
illegitimate purposes, including personal expenditures and to make payments to other investors
in a classic Ponzi-scheme fashion.  Of that amount, Coughlin paid $4.4 million, or approximately
35% of investors’ total deposits, to other investors who had requested withdrawals from their
Oxford International Credit Union accounts.  Coughlin also transferred money from Oxford
International Credit Union’s accounts to bank accounts he controlled in the names of Relief
Defendants American Quality Cleaning Services, Inc. (d/b/a “Oxford Privacy Group”) and

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Avocalon, LLC, and he also transferred money from Oxford International Cooperative Union to
American Quality Cleaning Services,  Inc.  Coughlin also misappropriated at least $1.57 million
of these investor funds for personal uses.
9. Oxford International Cooperative Union and Coughlin continued to accept
deposits and post investment returns on Oxford International Cooperative Union’s website
through 2011.
10. In late 2008 and 2009, Coughlin began to deny investors’ requests for
withdrawals from their accounts.  To explain his refusal to allow investors to access their funds,
Coughlin falsely claimed that American and foreign tax authorities, including the Internal
Revenue Service (“IRS”), had frozen Oxford International Credit Union and Oxford
International Cooperative Union’s accounts.  In audio and written messages posted to the Oxford
International Cooperative Union website in July 2013, Coughlin told investors that he is
preparing to litigate to require the U.S. government to unfreeze the Oxford International Credit
Union and Oxford International Cooperative Union accounts and return their money, and as
recently as January 2014, Coughlin told investors he was raising money for legal fees.
11. No such asset freeze ever existed, and Coughlin’s statements in this regard were,
and were intended to be,  false and misleading.  And, as intended, these statements lulled
investors into believing that their investment principal and the earnings remained securely intact,
even though they were unable to withdraw their money.
12. The substantial returns investors were led to believe they had earned in their
Oxford International Credit Union and Oxford International Cooperative Union accounts were a
fiction and never existed.  Indeed, most investors lost substantial sums, as Coughlin spent their
money to fund personal expenditures, unrelated business expenses, and to pay other investors in

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the Ponzi scheme.
13. By knowingly or recklessly engaging in the conduct described herein, the
defendants have violated, and unless restrained and enjoined will continue to violate, Section
10(b) of the Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. § 78j(b)] and Rule 10b-5
thereunder [17 C.F.R. § 240.10b-5], Section 17(a) of the Securities Act of 1933 (“Securities
Act”) [15 U.S.C. § 77q(a)], and Securities Act Section 5(a) and (c) [15 U.S.C. §§ 77e(a) and
77e(c)].  Consequently, the Commission now brings this action to enforce the securities laws, to
seek permanent injunctions against each of the defendants, enjoining them from engaging in the
transactions, acts, practices, and courses of business set forth herein, disgorgement of all ill-
gotten gains, plus prejudgment interested thereon, wrongfully obtained as a result of their illegal
conduct, civil penalties, and other relief as set forth herein and as the Court may find just and
appropriate.
JURISDICTION AND VENUE
14. The Commission brings this action pursuant to Securities Act Section 20(b) and
20(c) [15 U.S.C. § 77t(b)], and Exchange Act Sections 21(d) and 21(e) [15 U.S.C. §§ 78u(d) and
78u(e)].
15. This Court has jurisdiction over this action pursuant to Section 22 of the
Securities Act [15 U.S.C. § 77v], Section 27 of the Exchange Act [15 U.S.C. § 78aa] and 28
U.S.C. § 1331.
16. Venue is proper in this Court pursuant to Securities Act Section 22(a) [15. U.S.C.
§77 v] and Exchange Act Section 27 [15 U.S.C. § 78aa], as acts, practices and courses of
business constituting violations alleged herein occurred within the Southern District of Indiana.
17. Defendants directly and indirectly made use of the means and instrumentalities of

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interstate commerce and of the mails in connection with the acts, practices, and courses of
business alleged herein.
THE DEFENDANTS
18. Timothy J. Coughlin, age 63, is a resident of Indianapolis, Indiana.  Coughlin is
the Director of both Oxford International Credit Union and Oxford International Cooperative
Union, and he was responsible for investing the assets of Oxford International Credit Union and
Oxford International Cooperative Union on behalf of the entities’ membership.  Coughlin was
also responsible for all the content on the Oxford International Credit Union website
(www.oxfordicu.com), and for numerous written and audio statements posted on the Oxford
International Cooperative Union website ( www.oxfordprivacygroup.com).  Coughlin held
himself out to Oxford International Credit Union and Oxford International Cooperative Union
investors as a veteran of the United States Navy, but he has no record of military service.   In
1991, Coughlin pled guilty to one count of bank fraud in violation of 18 U.S.C. § 1344 and was
sentenced to 24 months imprisonment, four years of supervised release, and an order of
restitution [United States v. Coughlin, S.D. Ind. Case No. IP 91-143-CR].
19. OICU Ltd. was a corporation formed in February 2007 in the Commonwealth of
Dominica.  From February 2007 to December 2009, OICU Ltd., at times with OICU Investment
Corp., operated and did business as “Oxford International Credit Union” on the Internet through
the website www.oxfordicu.com; and from December 2008 to the present, OICU Ltd., at times
with OICU Investment Corp., operated and did business as “Oxford International Cooperative
Union” on the Internet through the website www.oxfordprivacygroup.com.
20. OICU Investments Corp. was a corporation registered in the Republic of
Panama in July 2008 and which dissolved in December 2011.  From July 2008 to December

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2009, OICU Investments Corp., at times with OICU Ltd., operated and did business as “Oxford
International Credit Union” on the Internet through the website www.oxfordicu.com; and from
December 2008 to the present, OICU Investments Corp., at times with OICU Ltd., operated and
did business as “Oxford International Cooperative Union” on the Internet through the website
www.oxfordprivacygroup.com.
RELIEF DEFENDANTS
21. American Quality Cleaning Services, Inc. (d/b/a “Oxford Privacy Group”)
(“OPG”) is an Indiana corporation formed in November 1991 and located in Indianapolis,
Indiana.  Coughlin was President of OPG.  OPG operated on the Internet at the website
www.oxfordprivacy.com.  OPG purported to provide information about protecting the privacy of
individuals’ personal information.  OPG also served as an “affinity group” and gateway for
membership in Oxford International Credit Union and Oxford International Cooperative Union.
Individuals desiring to open an account with Oxford International Credit Union and Oxford
International Cooperative Union were required to first join OPG and to pay a membership fee.
American Quality Cleaning Services, Inc. received some of the proceeds of members’
investments in Oxford International Credit Union and Oxford International Cooperative Union.
22. Avocalon, LLC (“Avocalon”) is an Indiana limited liability company formed in
May 2007.  Coughlin was the registered agent of Avocalon.  Avocalon purported to provide
services to people or organizations engaging in political advocacy.  Avocalon had no known
connection to Oxford International Credit Union or Oxford International Cooperative Union.
However, Avocalon received some of the deposits investors made in Oxford International Credit
Union.  In addition, salaries of Avocalon employees were paid using some of the deposits
investors made in Oxford International Credit Union.

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FACTUAL ALLEGATIONS
The Fraudulent “Credit Union” and “Cooperative Union” Scheme
23. Since 2007, Oxford International Credit Union operated on the Internet through
the website www.oxfordicu.com (“OICU”).  OICU claimed to be an “international credit union”
that operated as a pooled investment fund.  For example, OICU’s website claimed that:
The Credit Union is OWNED by its MEMBERS and it is operated
solely  for  their  benefit  as  the  OICU  manages  member  accounts,
invests the funds of the OICU, and then shares the growth of those
funds with the members according to their proportional position of
membership.  All revenues generated by the Credit Union from its
investments, interest earned on loans, and service fees collected are
shared  with  the  members  after  the  administrative  overhead  is
deducted from the revenues.

24. Coughlin was the Director of OICU, and he exercised sole decision-making
authority and control over the operations of OICU.
25. Coughlin held himself out as being responsible for advising OICU on investment
decisions and for selecting and making investments on behalf of its members.  Coughlin claimed
that he would pool individual members’ deposits and invest the sums in common projects or
other investments that yielded high daily investment returns.  Earnings generated through these
investments were purportedly reinvested by Coughlin, unless a member requested (and Coughlin
specifically approved) a withdrawal.  Coughlin was the only person authorized to approve or
reject requests by members to withdraw funds from OICU.
26. OICU claimed that it invested members’ money in “FOREX trading
opportunities, investment in pre-development real estate ventures, short term auto title loans,
short term secured and unsecured loans, secured industrial and commercial new venture loans,
[and on the] spot market for commodities.”  OICU also purported to generate returns based on
loans and services fees to other OICU members.  OICU claimed to diversify its investments so

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that “no more than 20% of the total fund will be placed in a single vehicle.”
27. In December 2008, Oxford International Credit Union changed its name to
Oxford International Cooperative Union and transitioned its operations to the website
www.oxfordprivacygroup.com (“OICU2”).  The business plan of OICU2 was touted as a
continuation and enhancement of OICU, and many OICU members transferred their account
balances to investments in OICU2.  OICU2’s website claimed that “Both OICU and OICU2 are
under the name of OICU Ltd.  OICU Ltd. is a Privately Pooled Fund in which you are a
participant.”  However, the OICU2 model was purportedly a share-based “cooperative union”
that claimed to give individuals the ability to allocate their deposits among several investment
choices that promised high returns.  These investment choices purportedly offered annual rates of
returns between 458% and 960%.
28. As with OICU, Coughlin held himself out as the Director of OICU2 and as being
responsible for advising OICU2 on investment decisions and for making investments on behalf
of its members.
29. Investors deposited money in OICU and OICU2 with the expectation of sharing in
the profits the “credit union” and “cooperative union” enterprises generated, based solely on
Coughlin’s efforts.
30. The membership interests in OICU and OICU2 that the defendants offered to
investors were securities within the meaning of Securities Act Section 2(a)(1) [15 U.S.C.
§77b(a)(1) 3(a)(10)] and Exchange Act Section 3(a)(10) [15 U.S.C. §78c(10)].
31. OICU and OICU2’s offers and sales of securities were not registered with the
Commission under Securities Act Section 5(a) or (c) [15 U.S.C. §§77d(a), 77d(c)].
32. OICU and OICU2 offered securities to individuals of all levels of financial

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sophistication, and without regard to each investor’s income and net-worth.  Thus, the defendants
did not limit investments only to “accredited investors,” as that term is defined by Securities Act
Section 2(a)(15) [15 U.S.C. § 77b(a)(15)].
33. Rather, to qualify to become a member of OICU or OICU2, a person simply had
to pay a fee to become a member of OPG, an Indiana corporation located in Indianapolis, which
was operated and controlled by Coughlin.  The fees paid to OPG were distinct from any fees
Coughlin took for purportedly managing investments on behalf of the OICU and OICU2
membership.
34. Even though OICU and OICU2 were incorporated overseas and purported to be
“International” pooled investment vehicles, Coughlin operated OICU and OICU2 from
Indianapolis, Indiana.  The defendants also used the fiction of a “credit union” to create a false
appearance of legitimacy.  Despite the defendants’ representations that OICU was a “credit
union,” it was not registered and did not operate as a lawful credit union.  For example:
(a) OICU has never registered as a state credit union in Indiana or any other
state.
(b) OICU has never registered as a federal credit union with the National
Credit Union Association.
(c) OICU has never registered as a foreign credit union with the Federal
Reserve, the Comptroller of the Currency, or the Federal Deposit
Insurance Company.
(d) OICU was controlled solely by Coughlin and did not loan or invest
member funds.  In contrast, bona fide credit unions are generally not-for-
profit financial institutions that are owned and controlled by their
members through boards and committees that are elected by their
members.  Funds held in bona fide credit union member accounts are the
primary source of funds for operations and are generally used to make
loans to other members.
(e) OICU did not provide traditional credit union services, such as check-
writing and ATM access.

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(f) OICU did not hold deposit insurance through either the National Credit
Union Share Insurance Fund (“NCUSIF”), a United States government-
backed fund used to protect deposits of credit union members, or
American Share Insurance, the sole private provider of state-chartered
credit union share insurance.  Holding share insurance is a legal
requirement for all federally-chartered and most state-chartered credit
unions.
35. As part of their fraud, the defendants employed the services of at least two
technicians to operate the OICU website, both of whom operated from Indianapolis during most
of the relevant period.  Coughlin directed the technicians to post information to the individual
members’ accounts, which members could access via the Internet.  The information purported to
show the investment returns Coughlin had earned on investors’ behalf and the increasing value
of their accounts, but the information was false.
36. Coughlin also made, or had ultimate authority over, all statements made on
OICU’s website, including the content he directed the technicians to post on the OICU website.
As described herein, nearly all of the information Coughlin posted on OICU’s website was
fraudulent.
37. Coughlin also made, or had ultimate authority over, numerous false written and
audio statements on OICU2’s website.  OICU2 held frequent conference calls for its members
originating from within the United States, in which participants located in the United States and
abroad listened to Coughlin’s broadcasts.  Audio recordings of these calls were posted to
OICU2’s website.  Coughlin made statements on these calls in which he provided false
information about OICU2’s operations and the purported results of his investing activities on
behalf of the membership.
38. Between June 2007 and December 2009, OICU collected deposits exceeding
$12.8 million from more than 5,000 investors.
39. Approximately 3,300 of OICU’s investors were United States residents (with

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victims residing in all 50 states and the District of Columbia) who, from within the United States,
opened their online accounts, agreed to participate in OICU, and transferred money to OICU.
OICU, acting solely through Coughlin from within the United States, made the decision to accept
or reject each OICU membership application.  The terms posted on OICU’s website provided
that all transactions, deposits and withdrawals would be deemed final, and thus irrevocable
liability attached when investors authorized their transactions via the Internet from within the
United States.
40. In 2009, many OICU members transferred their funds to OICU2, at which point
their accounts migrated from the www.oxfordicu.com website to the
www.oxfordprivacygroup.com website.
41. Between at least January 2007 and December 2011, OICU and OICU2 investors
funded their accounts via transactions that made use of the means and instrumentalities of
interstate commerce and of the mails, including the use of Internet-based money transfer services
(also known as “payment processors”) and by bank wire transfers.
42. OICU and OICU2 pooled the deposits they had collected from members in their
own accounts with various payment processors.  However, OICU and OICU2 operated
password-protected websites that showed each member’s account statements and other
information that falsely made it appear as if each investor’s funds were kept in a segregated
account.
Defendants’ Misstatements
Misstatements Regarding Investors’ Account Balances
43. OICU, OICU2, and Coughlin fraudulently boasted to investors that Coughlin had
achieved outstanding returns on their investments and that their account balances were growing

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exponentially.  However, Coughlin did not actually invest OICU and OICU2’s assets in a way
that could have generated the enormous investment returns investors were shown.
44. Nonetheless, to further his fraud, Coughlin periodically created tables of wholly
imaginary daily returns that he claimed he had earned by investing OICU and OICU2’s assets.
Coughlin instructed one of his website technicians to upload the investment returns to OICU and
OICU2’s websites, which automatically posted them as “earnings” to thousands of individual
investor accounts.
45. Earnings posted to OICU members’ accounts supposedly compounded on a daily
basis.  These purported returns averaged 0.471% per trading day over the January 2007 to
December 2009 time period, equating to an approximately 356% average annual rate of return
over the same period.  Thus, when investors logged into their OICU accounts online, they were
led to believe that their account balances were growing exponentially.
46. But the earnings shown in members’ accounts and their growing account balances
were wholly illusory; t he returns defendants reported were a fiction.  Members’ accounts were
not growing.  In reality, OICU and OICU2’s investors were losing money, as Coughlin spent a
portion of their investments on personal expenditures, unrelated business expenses, or to fund
redemptions by other investors in the Ponzi scheme.
Other Misstatements
47. In addition to the defendants’ misstatements regarding individual OICU and
OICU investor performance, Coughlin also made numerous written and audio statements
regarding OICU and OICU’s overall returns on their investments, which were published on
OICU’s and OICU2’s websites.  Like the individual return data he published to individual
investors’ accounts, these statements were a complete fabrication.

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48. For example, on January 15 and January 27, 2009, Coughlin falsely stated that he
was starting to “cash in” a “big block of equities” and was realizing large profits, which he called
a “windfall” for the membership.  Coughlin stated that the windfall would be distributed to favor
those who invested earlier and who were current with their payment of membership fees, and
would disfavor those who requested withdrawals.  These statements were false because Coughlin
had not made such profitable investments for OICU or OICU2 investors.
49. In addition to the defendants’ false statements regarding the entities’ status as
credit unions, discussed above, the defendants also deceived investors as to the security of their
investments.  From at least May 2007 through at least February 2009, OICU and Coughlin
falsely claimed that member accounts were insured by a private insurance company.  Coughlin
even posted bogus documents to the OICU website purporting to show an insurance policy
issued by “Credit Union and Bankers Insurance Company,” including a cancelled check intended
to evidence the payment of the policy premium.  In truth, no policy ever existed.  Indeed, even
the supposed insurer was a fiction.
50. In reliance upon the defendants’ apparent successes managing their investments
and the mistaken belief that they were investing in a fully-insured credit union, many investors
deposited additional money into their OICU and OICU2 accounts and encouraged friends,
relatives and others to participate in OICU and OICU2, as well.
51. As part of the defendants’ fraud, Coughlin also lied about his personal history.
For example, he failed to tell investors that he had previously been convicted of bank fraud and
was sentenced to 24 months in federal prison.  The defendants also led investors to believe that
Coughlin was a United States Navy veteran, serving meritoriously in Grenada.  But like
Coughlin’s supposed investing prowess, this representation was also a fiction.  Coughlin had

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never served in the military.
Defendants’ Ponzi Payments and Misuse of Investor Funds
52. Coughlin misused the funds investors deposited in their OICU and OICU2
accounts to enrich himself, fund unrelated businesses, and to make Ponzi-like payments to
investors requesting withdrawals.
53. Coughlin had sole discretion to approve or reject requests by OICU investors to
withdraw money from their accounts.
54. According to OICU’s terms of service, investors could only take withdrawals of
investment earnings posted to their accounts, not their original deposits.  As OICU and OICU2
did not generate sufficient returns from legitimate investment activity to satisfy the withdrawal
requests, investor withdrawals were paid out of money other investors deposited in OICU and
OICU2 to fund their accounts.
55. Between June 2007 and December 2008, Coughlin paid $4.4 million, or
approximately 35% of OICU’s total funds, as Ponzi payments to investors who had requested
withdrawals from their accounts.
56. OICU and OICU2 also transferred money derived from investor deposits into
U.S.-based bank accounts controlled by Coughlin.  Both OICU and OICU2 transferred investor
funds into at least one bank account in the name of OPG, and OICU also transferred investor
funds into at least one account in the name of Avocalon.  From January 8, 2007 to May 23, 2013,
bank accounts owned by OPG and Avocalon received from OICU and/or OICU2 transfers of
approximately $4.2 million, or approximately one-third of OICU’s total deposits.
57. Coughlin spent at least $1.57 million of the money transferred to the OPG and
Avocalon accounts on personal expenditures that were clearly unrelated to OICU and OICU2.

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These included   expenditures for clothing, entertainment, jewelry, mortgage payments, weapons,
personal shopping, and entertainment or personal services.
58. Coughlin also spent $1.43 million of OICU investor deposits on unrelated outside
businesses he was operating.  For example, he spent approximately $428,000 on payroll
expenses of Avocalon.
59. Coughlin also transferred more than $450,000 from OICU investor deposits into
at least one personal brokerage account to buy securities of a microcap issuer of which he was a
director.  Coughlin suffered a near total loss of his investment.
Defendants Lied to Investors to Keep Their Scheme from Being Revealed
60. In late 2008 and the first half of 2009, investors demanded the return of their
investments.  Faced with these redemption demands, Coughlin engaged in a stalling tactic,
falsely telling OICU and OICU2 investors that the banks that held their funds had begun to ask
for additional account information before they could release the funds.
61. Beginning in March 2010, Coughlin changed his story and began to tell OICU
and OICU2 investors that various government and regulatory agencies were to blame for the
defendants’ refusals to honor investors’ withdrawal requests.  And, by October 2011, Coughlin
began to tell OICU and OICU2 investors that their accounts had been frozen because of a dispute
with the IRS and other taxing authorities about payment of taxes.  All of these representations
were untrue.
62. Coughlin also falsely told investors that he was in settlement negotiations and
preparing for litigation with U.S. government agencies over access to OICU and OICU2’s assets.
He also discussed plans to raise money from investors to fund OICU and OICU2’s expenses
surrounding these sham discussions.

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63. Coughlin also lied to lull investors into believing that their funds were secure,
even though they were inaccessible.  For example, on March 24, 2009, Coughlin conducted a
conference call (which was posted to the OICU2 website) in which he stated that all investor
“funds are there, every penny is accounted for.”  He added that, “our funds are safe and secure.
They are not lost or tied up indefinitely.”  These statements are false because they belie the fact
Coughlin misappropriated and converted large amounts of money for his personal consumption
and unprofitable investments.
64. Even though the investor accounts were supposedly frozen, in June 2011,
Coughlin encouraged investors to pay their annual OICU and OICU2 membership fees by
awarding “bonuses” to those who were current or who became current with their dues.
65. OICU’s website remained online and accessible to investors through the end of
2011.  OICU2 continued to accept new and additional investments through the end of 2011.
Coughlin has posted false and fraudulent written and audio statements to the OICU2 website as
recently as January 2014.
The Victims of Defendants’ Fraud
66. Over 5,000 people are victims of the defendants’ fraudulent scheme, 3,300 of
whom reside in the United States.
67. The defendants primarily preyed on elderly, unsophisticated, and otherwise
vulnerable investors.  Among the domestic victims of the defendants’ fraudulent scheme are:
(a) M.N. is a 76-year-old retired nurse who invested approximately $15,000
in OICU after her husband died in December 2007.  M.N.’s husband had
invested in OICU before his death, and she wanted to continue to build
upon the seemingly profitable investment he had started.  M.N. used
proceeds from her husband’s life insurance policy to invest in OICU, and
hoped this would help her save for her retirement.  M.N. has been unable
to access her money.  Her home is in foreclosure and she is living on
social security.

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(b) J.S. is 70 years old and invested approximately $11,000 in OICU from
2007 to 2008.  He expected to use his OICU account to supplement his
retirement income.  J.S. made an initial deposit of several hundred dollars,
but as he watched his account value grow, he made additional deposits in
approximately hundred-dollar increments totaling about $11,000.  J.S.
believed that Coughlin’s willingness to risk his life as a purported Navy
officer made him more trustworthy.  J.S. also relied on Coughlin’s
representation that OICU deposits were insured as a basis for making his
investments.  Because J.S. has been unable to withdraw money from his
OICU account since 2009, he did not have sufficient income in retirement
and has gone back to work part-time.
(c) C.S. is  84 years old and invested $4,900 in an OICU account with his
wife.  They have continued to invest because of the high investment
returns they were shown and because they were told their accounts were
insured.  They also believed that Coughlin invested his personal money in
at least one of the same projects in which he had invested on behalf of
OICU2 .  Eventually, C.S. and his wife invested a total of $25,000 in
OICU, and then transferred a portion of their investment to OICU2.  C.S.
and his wife listened to Coughlin’s audio recordings posted on OICU2’s
website. C.S. understands from these broadcasts that government
authorities are preventing the release of their funds, which they are
depending on to help pay retirement expenses.
(d)  C .B., age 48, is among a number of investors from the deaf community to
invest in OICU.   C.B. invested approximately $5,000 and was led to
believe that her investment earned about 1.2% per day by making
investments.  C.B. has not had access to her investment principal for more
than 18 months.  C.B. is relying on her investment in OICU to pay for her
son’s college expenses.
(e) S.K., age 83, invested approximately $57,000 in OICU, and later
transferred a portion of those monies to OICU2.  S.K. initially invested
because he thought he was investing in a credit union which made
overseas investments.  S.K. believed that his investment principal would
be safe because he read on the OICU’s website that his deposits were
insured.   S.K. placed a lot of value on the fact that Coughlin was a retired
Navy captain, which he also read on OICU or OICU2’s website.
68. The defendants’ scheme has cost thousands of investors millions of dollars in real
and expected losses.
69. Many investors have relied on the gains they believed they had earned in their
OICU and OICU2 accounts to finance their retirement, pay college and other major expenses, or

19

supplement their incomes.
70. Most investors have also lost their investment principal, as Coughlin spent large
portions of their money to fund his personal expenditures, unrelated business expenses, and to
pay other investors in the Ponzi scheme.  The majority of the investors has not taken withdrawals
from their OICU and OICU2 accounts, or has withdrawn less money than they deposited in their
accounts.
FIRST CLAIM FOR RELIEF
Violations of Exchange Act Section 10(b) Rule 10b-5 Thereunder
(Against All Defendants)
Defendants Employed Devices, Schemes, and Artifices to Defraud, and Engaged in Acts,
Practices and Courses of Business,  Which Operated As a Fraud of Deceit in
Violation of Exchange Act Section 10(b) and Rule 10b-5(a) and (c)

71. The Commission realleges and reincorporates paragraphs 1 through 70 as if fully
set forth herein.
72. By reason of the conduct described above, Defendants Coughlin, OICU Ltd., and
OICU Investments Corp., in connection with the purchase or sale of securities, by the use of the
means or instrumentalities of interstate commerce or of the mails, or of any facility of any
national securities exchange, directly or indirectly, knowingly or recklessly (1) employed
devices, schemes, or artifices to defraud and/or (2) engaged in acts, practices, or courses of
business which operates or would operate as a fraud or deceit upon any persons, including
purchasers or sellers of the securities.
73. By reason of the actions alleged herein, the defendants violated Exchange Act
Section 10(b) [15 U.S.C. § 78j(b)] and subsections (a) and (c) of Rule 10b-5 thereunder [17
C.F.R. § 240.10b-5(a) and (c)].
74. Unless enjoined or otherwise restrained, the defendants will continue to violate

20

Exchange Act Section 10(b) [15 U.S.C. § 78j(b)] and subsections (a) and (c) of Rule 10b-5
thereunder [17 C.F.R. § 240.10b-5(a) and (c)].
Defendants Made Misrepresentations and Misleading Omissions of Material Fact in
Violation of Exchange Act Section 10(b) and Rule 10b-5(b)

75. Moreover, Defendants Coughlin, OICU Ltd., and OICU Investments Corp, in
connection with the purchase or sale of securities, directly or indirectly, by the use of the means
or instrumentalities of interstate commerce, or of the mails, or of any facility of any national
securities exchange, knowingly or recklessly, made untrue statements of material facts or omitted
to state material facts necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading.
76. By reason of the actions alleged herein, these defendants have also violated
Exchange Act Section 10(b) [15 U.S.C. § 78j(b)] and subsection (b) of Rule 10b-5 thereunder
[17 C.F.R. § 240.10b-5(b)] by, for example, at least the following:
(a) Making false or misleading statements that OICU is a member-owned
credit union;
(b) Making false or misleading statements that investments in OICU are
insured;
(c) Making false or misleading statements that Defendants were and are
investing OICU and OICU2 assets, on behalf of investors, to generate
significant positive returns;
(d) Making false or misleading statements to investors regarding the supposed
returns in and balances of investors’ individual OICU and OICU2
accounts;
(e) Failing to disclose to investors that OICU and OICU2 are Ponzi schemes
in which Defendants financed investor withdrawals by using the deposits
of other OICU and OICU2 investors;
(f) Omitting to disclose that Coughlin used deposits by OICU and OICU2
investors for personal expenditures, unprofitable personal investments,
and unrelated business expenditures; and

21

(g) Making other false statements regarding the security of investor assets
held by OICU and OICU2.
77. Unless enjoined or otherwise restrained, the defendants will continue to violate
Exchange Act Section 10(b) [15 U.S.C. § 78j(b)] and subsection (b) of Exchange Act Rule 10b-5
[17 C.F.R. § 240.10b-5(a) and (c)].
SECOND CLAIM FOR RELIEF
Violations of Securities Act Section 17(a)
(Against All Defendants)

78. The Commission realleges and reincorporates paragraphs 1 through 77 as if fully
set forth herein.
79. Defendants Coughlin, OICU Ltd., and OICU Investments Corp. have, directly or
indirectly, by use of means of instrumentalities of transportation or communication in interstate
commerce or by use of the mails, in the offer or sale of securities: (a) knowingly or recklessly
employed devices, schemes or artifices to defraud; (b) knowingly, recklessly, or negligently
obtained money or property by means of untrue statements of material fact, or have omitted to
state material facts necessary in order to make the statements made, in light of the circumstances
under which they were made, not misleading; and (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 purchasers of securities.
80. By reason of the actions alleged herein, the defendants violated Securities Act [15
U.S.C. § 77q(a)].  More specifically, by employing the fraudulent schemes and other activities
described above, the defendants violated Securities Act Sections 17(a)(1) and 17(a)(3) [15 U.S.C.
§ 77q(a)(1), (3)].  And, by obtaining money and property by means of the various materially
false and misleading written and audio statements, the defendants violated Securities Act Section
17(a)(2) [15 U.S.C. § 77q(a)(2)].

22

81. Unless enjoined or otherwise restrained, the defendants will continue to violate
Securities Act Section 17(a) [15 U.S.C. § 77q(a)].
THIRD CLAIM FOR RELIEF
Violations of Securities Act Section 5(a) and 5(c)
(Against All Defendants)

82. The Commission realleges and reincorporates paragraphs 1 through 81 as if fully
set forth herein.
83. Defendants Coughlin, OICU Ltd. and OICU Investments Corp., directly or
indirectly, singly and/or in concert with others: (1) without having any registration statement in
effect as to the securities transactions, (a) made use of the means or instrumentalities of
transportation or communication or the mails in interstate commerce to sell securities through the
use or medium of a prospectus or otherwise, or (b) carried or caused to be carried such securities
for the purpose of sale or for delivery after sale; and (2) made use of the means or
instrumentalities of transportation or communication or the mails in interstate commerce to sell
or offer to buy through the use or medium of a prospectus or otherwise securities as to which a
registration statement had not been filed as to such securities.
84. By reason of the actions alleged herein, the defendants violated Sections 5(a) and
(c) of the Securities Act [15 U.S.C. § 77e(a) & (c)].
85. Unless enjoined or otherwise restrained, the defendants will continue to violate
Securities Act Sections 5 (a)  and (c) [15 U.S.C. § 77e(a) & (c)].
FOURTH CLAIM FOR RELIEF
Unjust Enrichment
(Against Relief Defendant American Quality Cleaning Services, Inc.)

86. The Commission realleges and reincorporates paragraphs 1 through 85 as if fully
set forth herein.

23

87. Relief Defendant American Quality Cleaning Services, Inc. is an Indiana
corporation controlled by Coughlin.  Defendants transferred money deposited by OICU and
OICU2 investors from bank accounts owned by OICU and OICU2 to a bank account in the name
of American Quality Cleaning Services, Inc.
88. By reason of the actions alleged herein, Relief Defendant American Quality
Cleaning Services, Inc. has no legitimate claim to those funds, and has thus been unjustly
enriched under circumstances in which it is not just, equitable, or conscionable for it to retain
such profits.  Relief Defendant American Quality Cleaning Services, Inc. is a constructive trustee
of investor funds and proceeds of the fraud perpetrated by Defendants Coughlin, OICU Ltd., and
OICU Investments Corp.
FIFTH CLAIM FOR RELIEF
Unjust Enrichment
(Against Relief Defendant Avocalon, LLC)
89. The Commission realleges and reincorporates paragraphs 1 through 88 as if fully
set forth herein.
90. Relief Defendant Avocalon, LLC is an Indiana limited liability company
controlled by Coughlin.  Defendants transferred money deposited by OICU investors into a bank
account in the name of Avocalon.  In addition, salaries of Avocalon employees were paid using
some of the deposits investors made in OICU and OICU2.
91. By reason of the actions alleged herein, Relief Defendant Avocalon, LLC has no
legitimate claim to those funds, and has thus been unjustly enriched under circumstances in
which it is not just, equitable, or conscionable for it to retain such profits.  Relief Defendant
Avocalon, LLC is a constructive trustee of investor funds and proceeds of the fraud perpetrated
by Defendants Coughlin, OICU Ltd., and OICU Investments Corp.

24

PRAYER FOR RELIEF
WHEREFORE, the Commission respectfully requests that the Court enter a judgment:
(a) finding that Defendants violated the antifraud provisions of the federal securities
laws as alleged herein;
(b) permanently enjoining each Defendant from violating Securities Act Sections 5(a)
and (c), Securities Act Section 17(a), and Exchange Act Section 10(b) and Rules 10b-5
thereunder.
(c) permanently enjoining each Defendant from directly or indirectly, including, but
not limited to, through any entity he or it owns or controls, participating in the issuance,
purchase, offer or sale of any security, provided, however, that such Order shall not prevent him
or it from purchasing or selling securities for his or its own personal account;
(d) ordering each Defendant to disgorge, jointly and severally, all ill-gotten gains,
plus prejudgment interest thereon, wrongfully obtained as a result of their illegal conduct;
(e) ordering each Defendant to pay civil penalties pursuant to Securities Act Section
20(d) [15 U.S.C. § 77t(d)] and Exchange Act Section 21(d) [15 U.S.C. § 78u(d)];
(f) permanently barring Defendant Coughlin, pursuant to Securities Act Section 20(e)
[15 U.S.C. §77t(e)] and Exchange Act Section 21(d)(2) [15 U.S.C. §78u(d)(2)], from serving as
an officer or director of any issuer that has a class of securities registered pursuant to Exchange
Act Section 12 [15 U.S.C. §78l] or that is required to file reports pursuant to Exchange Act
Section 13 [15 U.S.C. §78m];
(g) imposing a constructive trust on Relief Defendant American Quality Cleaning
Services, Inc, d/b/a Oxford Privacy Group and ordering it to disgorge all funds transferred to it
from OICU and OICU2 and to pay prejudgment interest thereon;

25

(h) imposing a constructive trust on Relief Defendant Avocalon, LLC and ordering it
to disgorge all funds transferred to it from OICU and OICU2 and pay prejudgment interest
thereon; and
(i) granting such other relief to the Commission as the Court may deem just and
proper.
JURY DEMAND
Pursuant to Rule 39 of the Federal Rules of Civil Procedure, Plaintiff demands that this
case be tried to a jury.
Dated:  April 11, 2014    Respectfully submitted,

        /s/ Stephan J. Schlegelmilch
      Stephan J. Schlegelmilch (Ohio Bar No. 0073088)
      Counsel for Plaintiff
      U.S. SECURITIES AND EXCHANGE COMMISSION
      100 F Street, N.E.
      Washington, D.C.  20549
Email: [email protected]
Phone: (202) 551-4935
Facsimile: (202) 772-9292

Of Counsel:

Bridget M. Fitzpatrick
C. Joshua Felker
Adam J. Eisner
Carolyn Kurr
U.S.
 SECURITIES AND EXCHANGE COMMISSION
100 F. Street, N.E.
Washington, DC 20549

1 
 

Counsel of Record: 
Stephan J. Schlegelmilch 
Bridget M. Fitzpatrick 
C. Joshua Felker 
Adam J. Eisner 
Carolyn Kurr 
U.S. SECURITIES AND EXCHANGE COMMISSION 
100 F. Street, N.E. 
Washington, DC 20549 
Telephone: (202) 551-4935 (Schlegelmilch) 
Facsimile: (202) 551-4935 (Schlegelmilch) 
[email protected] 

 
 

UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF INDIANA 

INDIANAPOLIS DIVISION 
 
__________________________________________  

:  
UNITED STATES SECURITIES AND   : 
EXCHANGE COMMISSION    :  

:  
  Plaintiff,     :    

:    
  vs.     : Civil No.  1:14-cv-562  
       :   
TIMOTHY J. COUGHLIN, OICU LTD., and : 
OICU INVESTMENTS CORP. (both d/b/a : 
“Oxford International Credit Union” and/or : 
 “Oxford International Cooperative Union”),  : Jury Trial Demanded 
       :       
  Defendants, and   : 
       : 
AMERICAN QUALITY CLEANING  : 
SERVICES, INC. (d/b/a “Oxford Privacy   : 
Group”), and AVOCALON, LLC,   : 
       : 
  Relief Defendants.   : 
_________________________________________ : 

 
COMPLAINT 

 
Plaintiff United States Securities and Exchange Commission (the “Commission”), for its 

Complaint against Defendants Timothy J. Coughlin (“Coughlin”), OICU Ltd. and OICU 

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Investments Corp. (both d/b/a “Oxford International Credit Union or “Oxford International 

Cooperative Union”), alleges as follows: 

SUMMARY 

1. The defendants operated a fraudulent securities offering in which investors 

deposited their funds in an Internet-based, supposedly offshore, “international credit union” 

called Oxford International Credit Union.  In reality, the defendants were conducting a Ponzi 

scheme.  As a result of the defendants’ conduct, thousands of investors collectively suffered 

millions of dollars in losses. 

2. Between June 2007 and December 2009, using the website www.oxfordicu.com, 

Coughlin and Oxford International Credit Union collected deposits from more than 5,000 

investors exceeding $12.8 million dollars.  Beginning in December 2008, Coughlin began 

operating a successor to Oxford International Credit Union, called Oxford International 

Cooperative Union, using the website www.oxfordprivacygroup.com.   

3. Defendants defrauded investors into believing that the money they deposited into 

their Oxford International Credit Union and Oxford International Cooperative Union accounts 

would be pooled with other investors’ funds and invested by Coughlin in high-yield investments 

on behalf of all members.  The credit union, however, was a fiction, and the defendants did not 

actually make investments with the members’ deposits sufficient to generate the returns they 

boasted.   

4. Instead, to facilitate and further the fraud, the defendants posted false information 

to members’ online accounts to create the appearance that their deposits were earning exorbitant 

daily investment returns.  The Oxford International Credit Union website, for example, showed 

investors that their deposits were purportedly earning investment returns that averaged, during 

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3 
 

the January 2007 through December 2009 period, 0.471% compounded daily.   Oxford 

International Cooperative Union’s website also boasted bogus investment returns from its 

inception in late 2008 through December 2011. 

5. Coughlin and Oxford International Credit Union also falsely claimed that member 

accounts were insured by a private insurance company.  Coughlin posted documents to the 

Oxford International Credit Union website purporting to evidence an insurance policy and 

payment of the policy premium.  The documents, however, were fakes. 

6. As part of the scheme, Coughlin posted written and audio messages to the Oxford 

International Cooperative Union website in which he made materially false statements to 

investors about his successes in managing the entity’s investments and the status of their 

accounts.   

7. As a result of Coughlin’s supposed successes in managing their investments, 

many people deposited more money into their Oxford International Credit Union and Oxford 

International Cooperative Union accounts, and investors encouraged friends, relatives and others 

to deposit money in the entities, as well. 

8. Coughlin misappropriated at least $5.97 million from Oxford International Credit 

Union and Oxford International Cooperative Union members, using investor money for 

illegitimate purposes, including personal expenditures and to make payments to other investors 

in a classic Ponzi-scheme fashion.  Of that amount, Coughlin paid $4.4 million, or approximately 

35% of investors’ total deposits, to other investors who had requested withdrawals from their 

Oxford International Credit Union accounts.  Coughlin also transferred money from Oxford 

International Credit Union’s accounts to bank accounts he controlled in the names of Relief 

Defendants American Quality Cleaning Services, Inc. (d/b/a “Oxford Privacy Group”) and 

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Avocalon, LLC, and he also transferred money from Oxford International Cooperative Union to 

American Quality Cleaning Services, Inc.  Coughlin also misappropriated at least $1.57 million 

of these investor funds for personal uses.   

9. Oxford International Cooperative Union and Coughlin continued to accept 

deposits and post investment returns on Oxford International Cooperative Union’s website 

through 2011.   

10. In late 2008 and 2009, Coughlin began to deny investors’ requests for 

withdrawals from their accounts.  To explain his refusal to allow investors to access their funds, 

Coughlin falsely claimed that American and foreign tax authorities, including the Internal 

Revenue Service (“IRS”), had frozen Oxford International Credit Union and Oxford 

International Cooperative Union’s accounts.  In audio and written messages posted to the Oxford 

International Cooperative Union website in July 2013, Coughlin told investors that he is 

preparing to litigate to require the U.S. government to unfreeze the Oxford International Credit 

Union and Oxford International Cooperative Union accounts and return their money, and as 

recently as January 2014, Coughlin told investors he was raising money for legal fees. 

11. No such asset freeze ever existed, and Coughlin’s statements in this regard were, 

and were intended to be, false and misleading.  And, as intended, these statements lulled 

investors into believing that their investment principal and the earnings remained securely intact, 

even though they were unable to withdraw their money.     

12. The substantial returns investors were led to believe they had earned in their 

Oxford International Credit Union and Oxford International Cooperative Union accounts were a 

fiction and never existed.  Indeed, most investors lost substantial sums, as Coughlin spent their 

money to fund personal expenditures, unrelated business expenses, and to pay other investors in 

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5 
 

the Ponzi scheme. 

13. By knowingly or recklessly engaging in the conduct described herein, the 

defendants have violated, and unless restrained and enjoined will continue to violate, Section 

10(b) of the Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. § 78j(b)] and Rule 10b-5 

thereunder [17 C.F.R. § 240.10b-5], Section 17(a) of the Securities Act of 1933 (“Securities 

Act”) [15 U.S.C. § 77q(a)], and Securities Act Section 5(a) and (c) [15 U.S.C. §§ 77e(a) and 

77e(c)].  Consequently, the Commission now brings this action to enforce the securities laws, to 

seek permanent injunctions against each of the defendants, enjoining them from engaging in the 

transactions, acts, practices, and courses of business set forth herein, disgorgement of all ill-

gotten gains, plus prejudgment interested thereon, wrongfully obtained as a result of their illegal 

conduct, civil penalties, and other relief as set forth herein and as the Court may find just and 

appropriate. 

JURISDICTION AND VENUE 

14. The Commission brings this action pursuant to Securities Act Section 20(b) and 

20(c) [15 U.S.C. § 77t(b)], and Exchange Act Sections 21(d) and 21(e) [15 U.S.C. §§ 78u(d) and 

78u(e)]. 

15. This Court has jurisdiction over this action pursuant to Section 22 of the 

Securities Act [15 U.S.C. § 77v], Section 27 of the Exchange Act [15 U.S.C. § 78aa] and 28 

U.S.C. § 1331. 

16. Venue is proper in this Court pursuant to Securities Act Section 22(a) [15. U.S.C. 

§77 v] and Exchange Act Section 27 [15 U.S.C. § 78aa], as acts, practices and courses of 

business constituting violations alleged herein occurred within the Southern District of Indiana. 

17. Defendants directly and indirectly made use of the means and instrumentalities of 

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6 
 

interstate commerce and of the mails in connection with the acts, practices, and courses of 

business alleged herein. 

THE DEFENDANTS 

18. Timothy J. Coughlin, age 63, is a resident of Indianapolis, Indiana.  Coughlin is 

the Director of both Oxford International Credit Union and Oxford International Cooperative 

Union, and he was responsible for investing the assets of Oxford International Credit Union and 

Oxford International Cooperative Union on behalf of the entities’ membership.  Coughlin was 

also responsible for all the content on the Oxford International Credit Union website 

(www.oxfordicu.com), and for numerous written and audio statements posted on the Oxford 

International Cooperative Union website (www.oxfordprivacygroup.com).  Coughlin held 

himself out to Oxford International Credit Union and Oxford International Cooperative Union 

investors as a veteran of the United States Navy, but he has no record of military service.  In 

1991, Coughlin pled guilty to one count of bank fraud in violation of 18 U.S.C. § 1344 and was 

sentenced to 24 months imprisonment, four years of supervised release, and an order of 

restitution [United States v. Coughlin, S.D. Ind. Case No. IP 91-143-CR].  

19. OICU Ltd. was a corporation formed in February 2007 in the Commonwealth of 

Dominica.  From February 2007 to December 2009, OICU Ltd., at times with OICU Investment 

Corp., operated and did business as “Oxford International Credit Union” on the Internet through 

the website www.oxfordicu.com; and from December 2008 to the present, OICU Ltd., at times 

with OICU Investment Corp., operated and did business as “Oxford International Cooperative 

Union” on the Internet through the website www.oxfordprivacygroup.com.    

20. OICU Investments Corp. was a corporation registered in the Republic of 

Panama in July 2008 and which dissolved in December 2011.  From July 2008 to December 

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7 
 

2009, OICU Investments Corp., at times with OICU Ltd., operated and did business as “Oxford 

International Credit Union” on the Internet through the website www.oxfordicu.com; and from 

December 2008 to the present, OICU Investments Corp., at times with OICU Ltd., operated and 

did business as “Oxford International Cooperative Union” on the Internet through the website 

www.oxfordprivacygroup.com.   

RELIEF DEFENDANTS 

21. American Quality Cleaning Services, Inc. (d/b/a “Oxford Privacy Group”) 

(“OPG”) is an Indiana corporation formed in November 1991 and located in Indianapolis, 

Indiana.  Coughlin was President of OPG.  OPG operated on the Internet at the website 

www.oxfordprivacy.com.  OPG purported to provide information about protecting the privacy of 

individuals’ personal information.  OPG also served as an “affinity group” and gateway for 

membership in Oxford International Credit Union and Oxford International Cooperative Union.  

Individuals desiring to open an account with Oxford International Credit Union and Oxford 

International Cooperative Union were required to first join OPG and to pay a membership fee.  

American Quality Cleaning Services, Inc. received some of the proceeds of members’ 

investments in Oxford International Credit Union and Oxford International Cooperative Union.   

22. Avocalon, LLC (“Avocalon”) is an Indiana limited liability company formed in 

May 2007.  Coughlin was the registered agent of Avocalon.  Avocalon purported to provide 

services to people or organizations engaging in political advocacy.  Avocalon had no known 

connection to Oxford International Credit Union or Oxford International Cooperative Union.  

However, Avocalon received some of the deposits investors made in Oxford International Credit 

Union.  In addition, salaries of Avocalon employees were paid using some of the deposits 

investors made in Oxford International Credit Union. 

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8 
 

FACTUAL ALLEGATIONS 

The Fraudulent “Credit Union” and “Cooperative Union” Scheme 

23. Since 2007, Oxford International Credit Union operated on the Internet through 

the website www.oxfordicu.com (“OICU”).  OICU claimed to be an “international credit union” 

that operated as a pooled investment fund.  For example, OICU’s website claimed that:  

The Credit Union is OWNED by its MEMBERS and it is operated 
solely for their benefit as the OICU manages member accounts, 
invests the funds of the OICU, and then shares the growth of those 
funds with the members according to their proportional position of 
membership.  All revenues generated by the Credit Union from its 
investments, interest earned on loans, and service fees collected are 
shared with the members after the administrative overhead is 
deducted from the revenues. 
 

24. Coughlin was the Director of OICU, and he exercised sole decision-making 

authority and control over the operations of OICU.   

25. Coughlin held himself out as being responsible for advising OICU on investment 

decisions and for selecting and making investments on behalf of its members.  Coughlin claimed 

that he would pool individual members’ deposits and invest the sums in common projects or 

other investments that yielded high daily investment returns.  Earnings generated through these 

investments were purportedly reinvested by Coughlin, unless a member requested (and Coughlin 

specifically approved) a withdrawal.  Coughlin was the only person authorized to approve or 

reject requests by members to withdraw funds from OICU. 

26. OICU claimed that it invested members’ money in “FOREX trading 

opportunities, investment in pre-development real estate ventures, short term auto title loans, 

short term secured and unsecured loans, secured industrial and commercial new venture loans, 

[and on the] spot market for commodities.”  OICU also purported to generate returns based on 

loans and services fees to other OICU members.  OICU claimed to diversify its investments so 

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9 
 

that “no more than 20% of the total fund will be placed in a single vehicle.” 

27. In December 2008, Oxford International Credit Union changed its name to 

Oxford International Cooperative Union and transitioned its operations to the website 

www.oxfordprivacygroup.com (“OICU2”).  The business plan of OICU2 was touted as a 

continuation and enhancement of OICU, and many OICU members transferred their account 

balances to investments in OICU2.  OICU2’s website claimed that “Both OICU and OICU2 are 

under the name of OICU Ltd.  OICU Ltd. is a Privately Pooled Fund in which you are a 

participant.”  However, the OICU2 model was purportedly a share-based “cooperative union” 

that claimed to give individuals the ability to allocate their deposits among several investment 

choices that promised high returns.  These investment choices purportedly offered annual rates of 

returns between 458% and 960%. 

28. As with OICU, Coughlin held himself out as the Director of OICU2 and as being 

responsible for advising OICU2 on investment decisions and for making investments on behalf 

of its members.   

29. Investors deposited money in OICU and OICU2 with the expectation of sharing in 

the profits the “credit union” and “cooperative union” enterprises generated, based solely on 

Coughlin’s efforts.  

30. The membership interests in OICU and OICU2 that the defendants offered to 

investors were securities within the meaning of Securities Act Section 2(a)(1) [15 U.S.C. 

§77b(a)(1) 3(a)(10)] and Exchange Act Section 3(a)(10) [15 U.S.C. §78c(10)].   

31. OICU and OICU2’s offers and sales of securities were not registered with the 

Commission under Securities Act Section 5(a) or (c) [15 U.S.C. §§77d(a), 77d(c)]. 

32. OICU and OICU2 offered securities to individuals of all levels of financial 

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10 
 

sophistication, and without regard to each investor’s income and net-worth.  Thus, the defendants 

did not limit investments only to “accredited investors,” as that term is defined by Securities Act 

Section 2(a)(15) [15 U.S.C. § 77b(a)(15)].  

33. Rather, to qualify to become a member of OICU or OICU2, a person simply had 

to pay a fee to become a member of OPG, an Indiana corporation located in Indianapolis, which 

was operated and controlled by Coughlin.  The fees paid to OPG were distinct from any fees 

Coughlin took for purportedly managing investments on behalf of the OICU and OICU2 

membership. 

34. Even though OICU and OICU2 were incorporated overseas and purported to be 

“International” pooled investment vehicles, Coughlin operated OICU and OICU2 from 

Indianapolis, Indiana.  The defendants also used the fiction of a “credit union” to create a false 

appearance of legitimacy.  Despite the defendants’ representations that OICU was a “credit 

union,” it was not registered and did not operate as a lawful credit union.  For example: 

(a) OICU has never registered as a state credit union in Indiana or any other 
state.  

(b) OICU has never registered as a federal credit union with the National 
Credit Union Association.   

(c) OICU has never registered as a foreign credit union with the Federal 
Reserve, the Comptroller of the Currency, or the Federal Deposit 
Insurance Company. 

(d) OICU was controlled solely by Coughlin and did not loan or invest 
member funds.  In contrast, bona fide credit unions are generally not-for-
profit financial institutions that are owned and controlled by their 
members through boards and committees that are elected by their 
members.  Funds held in bona fide credit union member accounts are the 
primary source of funds for operations and are generally used to make 
loans to other members.  

(e) OICU did not provide traditional credit union services, such as check-
writing and ATM access. 

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(f) OICU did not hold deposit insurance through either the National Credit 
Union Share Insurance Fund (“NCUSIF”), a United States government-
backed fund used to protect deposits of credit union members, or 
American Share Insurance, the sole private provider of state-chartered 
credit union share insurance.  Holding share insurance is a legal 
requirement for all federally-chartered and most state-chartered credit 
unions.   

35. As part of their fraud, the defendants employed the services of at least two 

technicians to operate the OICU website, both of whom operated from Indianapolis during most 

of the relevant period.  Coughlin directed the technicians to post information to the individual 

members’ accounts, which members could access via the Internet.  The information purported to 

show the investment returns Coughlin had earned on investors’ behalf and the increasing value 

of their accounts, but the information was false.   

36. Coughlin also made, or had ultimate authority over, all statements made on 

OICU’s website, including the content he directed the technicians to post on the OICU website.  

As described herein, nearly all of the information Coughlin posted on OICU’s website was 

fraudulent. 

37. Coughlin also made, or had ultimate authority over, numerous false written and 

audio statements on OICU2’s website.  OICU2 held frequent conference calls for its members 

originating from within the United States, in which participants located in the United States and 

abroad listened to Coughlin’s broadcasts.  Audio recordings of these calls were posted to 

OICU2’s website.  Coughlin made statements on these calls in which he provided false 

information about OICU2’s operations and the purported results of his investing activities on 

behalf of the membership.   

38. Between June 2007 and December 2009, OICU collected deposits exceeding 

$12.8 million from more than 5,000 investors.   

39. Approximately 3,300 of OICU’s investors were United States residents (with 

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victims residing in all 50 states and the District of Columbia) who, from within the United States, 

opened their online accounts, agreed to participate in OICU, and transferred money to OICU.   

OICU, acting solely through Coughlin from within the United States, made the decision to accept 

or reject each OICU membership application.  The terms posted on OICU’s website provided 

that all transactions, deposits and withdrawals would be deemed final, and thus irrevocable 

liability attached when investors authorized their transactions via the Internet from within the 

United States.   

40. In 2009, many OICU members transferred their funds to OICU2, at which point 

their accounts migrated from the www.oxfordicu.com website to the 

www.oxfordprivacygroup.com website. 

41. Between at least January 2007 and December 2011, OICU and OICU2 investors 

funded their accounts via transactions that made use of the means and instrumentalities of 

interstate commerce and of the mails, including the use of Internet-based money transfer services 

(also known as “payment processors”) and by bank wire transfers.   

42. OICU and OICU2 pooled the deposits they had collected from members in their 

own accounts with various payment processors.  However, OICU and OICU2 operated 

password-protected websites that showed each member’s account statements and other 

information that falsely made it appear as if each investor’s funds were kept in a segregated 

account.   

Defendants’ Misstatements 

Misstatements Regarding Investors’ Account Balances 

43. OICU, OICU2, and Coughlin fraudulently boasted to investors that Coughlin had 

achieved outstanding returns on their investments and that their account balances were growing 

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exponentially.  However, Coughlin did not actually invest OICU and OICU2’s assets in a way 

that could have generated the enormous investment returns investors were shown.   

44. Nonetheless, to further his fraud, Coughlin periodically created tables of wholly 

imaginary daily returns that he claimed he had earned by investing OICU and OICU2’s assets.  

Coughlin instructed one of his website technicians to upload the investment returns to OICU and 

OICU2’s websites, which automatically posted them as “earnings” to thousands of individual 

investor accounts.   

45. Earnings posted to OICU members’ accounts supposedly compounded on a daily 

basis.  These purported returns averaged 0.471% per trading day over the January 2007 to 

December 2009 time period, equating to an approximately 356% average annual rate of return 

over the same period.  Thus, when investors logged into their OICU accounts online, they were 

led to believe that their account balances were growing exponentially. 

46. But the earnings shown in members’ accounts and their growing account balances 

were wholly illusory; the returns defendants reported were a fiction.  Members’ accounts were 

not growing.  In reality, OICU and OICU2’s investors were losing money, as Coughlin spent a 

portion of their investments on personal expenditures, unrelated business expenses, or to fund 

redemptions by other investors in the Ponzi scheme. 

Other Misstatements 

47. In addition to the defendants’ misstatements regarding individual OICU and 

OICU investor performance, Coughlin also made numerous written and audio statements 

regarding OICU and OICU’s overall returns on their investments, which were published on 

OICU’s and OICU2’s websites.  Like the individual return data he published to individual 

investors’ accounts, these statements were a complete fabrication.   

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48. For example, on January 15 and January 27, 2009, Coughlin falsely stated that he 

was starting to “cash in” a “big block of equities” and was realizing large profits, which he called 

a “windfall” for the membership.  Coughlin stated that the windfall would be distributed to favor 

those who invested earlier and who were current with their payment of membership fees, and 

would disfavor those who requested withdrawals.  These statements were false because Coughlin 

had not made such profitable investments for OICU or OICU2 investors. 

49. In addition to the defendants’ false statements regarding the entities’ status as 

credit unions, discussed above, the defendants also deceived investors as to the security of their 

investments.  From at least May 2007 through at least February 2009, OICU and Coughlin 

falsely claimed that member accounts were insured by a private insurance company.  Coughlin 

even posted bogus documents to the OICU website purporting to show an insurance policy 

issued by “Credit Union and Bankers Insurance Company,” including a cancelled check intended 

to evidence the payment of the policy premium.  In truth, no policy ever existed.  Indeed, even 

the supposed insurer was a fiction. 

50. In reliance upon the defendants’ apparent successes managing their investments 

and the mistaken belief that they were investing in a fully-insured credit union, many investors 

deposited additional money into their OICU and OICU2 accounts and encouraged friends, 

relatives and others to participate in OICU and OICU2, as well. 

51. As part of the defendants’ fraud, Coughlin also lied about his personal history.  

For example, he failed to tell investors that he had previously been convicted of bank fraud and 

was sentenced to 24 months in federal prison.  The defendants also led investors to believe that 

Coughlin was a United States Navy veteran, serving meritoriously in Grenada.  But like 

Coughlin’s supposed investing prowess, this representation was also a fiction.  Coughlin had 

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never served in the military.   

Defendants’ Ponzi Payments and Misuse of Investor Funds 

52. Coughlin misused the funds investors deposited in their OICU and OICU2 

accounts to enrich himself, fund unrelated businesses, and to make Ponzi-like payments to 

investors requesting withdrawals. 

53. Coughlin had sole discretion to approve or reject requests by OICU investors to 

withdraw money from their accounts. 

54. According to OICU’s terms of service, investors could only take withdrawals of 

investment earnings posted to their accounts, not their original deposits.  As OICU and OICU2 

did not generate sufficient returns from legitimate investment activity to satisfy the withdrawal 

requests, investor withdrawals were paid out of money other investors deposited in OICU and 

OICU2 to fund their accounts. 

55. Between June 2007 and December 2008, Coughlin paid $4.4 million, or 

approximately 35% of OICU’s total funds, as Ponzi payments to investors who had requested 

withdrawals from their accounts.   

56. OICU and OICU2 also transferred money derived from investor deposits into 

U.S.-based bank accounts controlled by Coughlin.  Both OICU and OICU2 transferred investor 

funds into at least one bank account in the name of OPG, and OICU also transferred investor 

funds into at least one account in the name of Avocalon.  From January 8, 2007 to May 23, 2013, 

bank accounts owned by OPG and Avocalon received from OICU and/or OICU2 transfers of 

approximately $4.2 million, or approximately one-third of OICU’s total deposits. 

57. Coughlin spent at least $1.57 million of the money transferred to the OPG and 

Avocalon accounts on personal expenditures that were clearly unrelated to OICU and OICU2.  

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These included expenditures for clothing, entertainment, jewelry, mortgage payments, weapons, 

personal shopping, and entertainment or personal services. 

58. Coughlin also spent $1.43 million of OICU investor deposits on unrelated outside 

businesses he was operating.  For example, he spent approximately $428,000 on payroll 

expenses of Avocalon. 

59. Coughlin also transferred more than $450,000 from OICU investor deposits into 

at least one personal brokerage account to buy securities of a microcap issuer of which he was a 

director.  Coughlin suffered a near total loss of his investment.   

Defendants Lied to Investors to Keep Their Scheme from Being Revealed 

60. In late 2008 and the first half of 2009, investors demanded the return of their 

investments.  Faced with these redemption demands, Coughlin engaged in a stalling tactic, 

falsely telling OICU and OICU2 investors that the banks that held their funds had begun to ask 

for additional account information before they could release the funds.   

61. Beginning in March 2010, Coughlin changed his story and began to tell OICU 

and OICU2 investors that various government and regulatory agencies were to blame for the 

defendants’ refusals to honor investors’ withdrawal requests.  And, by October 2011, Coughlin 

began to tell OICU and OICU2 investors that their accounts had been frozen because of a dispute 

with the IRS and other taxing authorities about payment of taxes.  All of these representations 

were untrue.   

62. Coughlin also falsely told investors that he was in settlement negotiations and 

preparing for litigation with U.S. government agencies over access to OICU and OICU2’s assets.  

He also discussed plans to raise money from investors to fund OICU and OICU2’s expenses 

surrounding these sham discussions.  

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63. Coughlin also lied to lull investors into believing that their funds were secure, 

even though they were inaccessible.  For example, on March 24, 2009, Coughlin conducted a 

conference call (which was posted to the OICU2 website) in which he stated that all investor 

“funds are there, every penny is accounted for.”  He added that, “our funds are safe and secure.  

They are not lost or tied up indefinitely.”  These statements are false because they belie the fact 

Coughlin misappropriated and converted large amounts of money for his personal consumption 

and unprofitable investments.   

64. Even though the investor accounts were supposedly frozen, in June 2011, 

Coughlin encouraged investors to pay their annual OICU and OICU2 membership fees by 

awarding “bonuses” to those who were current or who became current with their dues.   

65. OICU’s website remained online and accessible to investors through the end of 

2011.  OICU2 continued to accept new and additional investments through the end of 2011.  

Coughlin has posted false and fraudulent written and audio statements to the OICU2 website as 

recently as January 2014. 

The Victims of Defendants’ Fraud 

66. Over 5,000 people are victims of the defendants’ fraudulent scheme, 3,300 of 

whom reside in the United States. 

67. The defendants primarily preyed on elderly, unsophisticated, and otherwise 

vulnerable investors.  Among the domestic victims of the defendants’ fraudulent scheme are: 

(a) M.N. is a 76-year-old retired nurse who invested approximately $15,000 
in OICU after her husband died in December 2007.  M.N.’s husband had 
invested in OICU before his death, and she wanted to continue to build 
upon the seemingly profitable investment he had started.  M.N. used 
proceeds from her husband’s life insurance policy to invest in OICU, and 
hoped this would help her save for her retirement.  M.N. has been unable 
to access her money.  Her home is in foreclosure and she is living on 
social security. 

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(b) J.S. is 70 years old and invested approximately $11,000 in OICU from 
2007 to 2008.  He expected to use his OICU account to supplement his 
retirement income.  J.S. made an initial deposit of several hundred dollars, 
but as he watched his account value grow, he made additional deposits in 
approximately hundred-dollar increments totaling about $11,000.  J.S. 
believed that Coughlin’s willingness to risk his life as a purported Navy 
officer made him more trustworthy.  J.S. also relied on Coughlin’s 
representation that OICU deposits were insured as a basis for making his 
investments.  Because J.S. has been unable to withdraw money from his 
OICU account since 2009, he did not have sufficient income in retirement 
and has gone back to work part-time. 

(c) C.S. is 84 years old and invested $4,900 in an OICU account with his 
wife.  They have continued to invest because of the high investment 
returns they were shown and because they were told their accounts were 
insured.  They also believed that Coughlin invested his personal money in 
at least one of the same projects in which he had invested on behalf of 
OICU2 .  Eventually, C.S. and his wife invested a total of $25,000 in 
OICU, and then transferred a portion of their investment to OICU2.  C.S. 
and his wife listened to Coughlin’s audio recordings posted on OICU2’s 
website. C.S. understands from these broadcasts that government 
authorities are preventing the release of their funds, which they are 
depending on to help pay retirement expenses. 

(d)  C.B., age 48, is among a number of investors from the deaf community to 
invest in OICU.   C.B. invested approximately $5,000 and was led to 
believe that her investment earned about 1.2% per day by making 
investments.  C.B. has not had access to her investment principal for more 
than 18 months.  C.B. is relying on her investment in OICU to pay for her 
son’s college expenses.   

(e) S.K., age 83, invested approximately $57,000 in OICU, and later 
transferred a portion of those monies to OICU2.  S.K. initially invested 
because he thought he was investing in a credit union which made 
overseas investments.  S.K. believed that his investment principal would 
be safe because he read on the OICU’s website that his deposits were 
insured.   S.K. placed a lot of value on the fact that Coughlin was a retired 
Navy captain, which he also read on OICU or OICU2’s website.  

68. The defendants’ scheme has cost thousands of investors millions of dollars in real 

and expected losses.   

69. Many investors have relied on the gains they believed they had earned in their 

OICU and OICU2 accounts to finance their retirement, pay college and other major expenses, or 

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supplement their incomes.   

70. Most investors have also lost their investment principal, as Coughlin spent large 

portions of their money to fund his personal expenditures, unrelated business expenses, and to 

pay other investors in the Ponzi scheme.  The majority of the investors has not taken withdrawals 

from their OICU and OICU2 accounts, or has withdrawn less money than they deposited in their 

accounts. 

FIRST CLAIM FOR RELIEF 
Violations of Exchange Act Section 10(b) Rule 10b-5 Thereunder 

(Against All Defendants) 

Defendants Employed Devices, Schemes, and Artifices to Defraud, and Engaged in Acts,  
Practices and Courses of Business, Which Operated As a Fraud of Deceit in  

Violation of Exchange Act Section 10(b) and Rule 10b-5(a) and (c) 
 

71. The Commission realleges and reincorporates paragraphs 1 through 70 as if fully 

set forth herein. 

72. By reason of the conduct described above, Defendants Coughlin, OICU Ltd., and 

OICU Investments Corp., in connection with the purchase or sale of securities, by the use of the 

means or instrumentalities of interstate commerce or of the mails, or of any facility of any 

national securities exchange, directly or indirectly, knowingly or recklessly (1) employed 

devices, schemes, or artifices to defraud and/or (2) engaged in acts, practices, or courses of 

business which operates or would operate as a fraud or deceit upon any persons, including 

purchasers or sellers of the securities. 

73. By reason of the actions alleged herein, the defendants violated Exchange Act 

Section 10(b) [15 U.S.C. § 78j(b)] and subsections (a) and (c) of Rule 10b-5 thereunder [17 

C.F.R. § 240.10b-5(a) and (c)].    

74. Unless enjoined or otherwise restrained, the defendants will continue to violate 

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Exchange Act Section 10(b) [15 U.S.C. § 78j(b)] and subsections (a) and (c) of Rule 10b-5 

thereunder [17 C.F.R. § 240.10b-5(a) and (c)].  

Defendants Made Misrepresentations and Misleading Omissions of Material Fact in  
Violation of Exchange Act Section 10(b) and Rule 10b-5(b) 

 
75. Moreover, Defendants Coughlin, OICU Ltd., and OICU Investments Corp, in 

connection with the purchase or sale of securities, directly or indirectly, by the use of the means 

or instrumentalities of interstate commerce, or of the mails, or of any facility of any national 

securities exchange, knowingly or recklessly, made untrue statements of material facts or omitted 

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

circumstances under which they were made, not misleading.   

76. By reason of the actions alleged herein, these defendants have also violated 

Exchange Act Section 10(b) [15 U.S.C. § 78j(b)] and subsection (b) of Rule 10b-5 thereunder 

[17 C.F.R. § 240.10b-5(b)] by, for example, at least the following: 

(a) Making false or misleading statements that OICU is a member-owned 
credit union; 

(b) Making false or misleading statements that investments in OICU are 
insured; 

(c) Making false or misleading statements that Defendants were and are 
investing OICU and OICU2 assets, on behalf of investors, to generate 
significant positive returns; 

(d) Making false or misleading statements to investors regarding the supposed 
returns in and balances of investors’ individual OICU and OICU2 
accounts; 

(e) Failing to disclose to investors that OICU and OICU2 are Ponzi schemes 
in which Defendants financed investor withdrawals by using the deposits 
of other OICU and OICU2 investors; 

(f) Omitting to disclose that Coughlin used deposits by OICU and OICU2 
investors for personal expenditures, unprofitable personal investments, 
and unrelated business expenditures; and 

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(g) Making other false statements regarding the security of investor assets 
held by OICU and OICU2.  

77. Unless enjoined or otherwise restrained, the defendants will continue to violate 

Exchange Act Section 10(b) [15 U.S.C. § 78j(b)] and subsection (b) of Exchange Act Rule 10b-5 

[17 C.F.R. § 240.10b-5(a) and (c)]. 

SECOND CLAIM FOR RELIEF 
Violations of Securities Act Section 17(a) 

(Against All Defendants) 
 

78. The Commission realleges and reincorporates paragraphs 1 through 77 as if fully 

set forth herein. 

79. Defendants Coughlin, OICU Ltd., and OICU Investments Corp. have, directly or 

indirectly, by use of means of instrumentalities of transportation or communication in interstate 

commerce or by use of the mails, in the offer or sale of securities: (a) knowingly or recklessly 

employed devices, schemes or artifices to defraud; (b) knowingly, recklessly, or negligently 

obtained money or property by means of untrue statements of material fact, or have omitted to 

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

under which they were made, not misleading; and (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 purchasers of securities. 

80. By reason of the actions alleged herein, the defendants violated Securities Act [15 

U.S.C. § 77q(a)].  More specifically, by employing the fraudulent schemes and other activities 

described above, the defendants violated Securities Act Sections 17(a)(1) and 17(a)(3) [15 U.S.C. 

§ 77q(a)(1), (3)].  And, by obtaining money and property by means of the various materially 

false and misleading written and audio statements, the defendants violated Securities Act Section 

17(a)(2) [15 U.S.C. § 77q(a)(2)]. 

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81. Unless enjoined or otherwise restrained, the defendants will continue to violate 

Securities Act Section 17(a) [15 U.S.C. § 77q(a)]. 

THIRD CLAIM FOR RELIEF 
Violations of Securities Act Section 5(a) and 5(c) 

(Against All Defendants) 
 

82. The Commission realleges and reincorporates paragraphs 1 through 81 as if fully 

set forth herein. 

83. Defendants Coughlin, OICU Ltd. and OICU Investments Corp., directly or 

indirectly, singly and/or in concert with others: (1) without having any registration statement in 

effect as to the securities transactions, (a) made use of the means or instrumentalities of 

transportation or communication or the mails in interstate commerce to sell securities through the 

use or medium of a prospectus or otherwise, or (b) carried or caused to be carried such securities 

for the purpose of sale or for delivery after sale; and (2) made use of the means or 

instrumentalities of transportation or communication or the mails in interstate commerce to sell 

or offer to buy through the use or medium of a prospectus or otherwise securities as to which a 

registration statement had not been filed as to such securities. 

84. By reason of the actions alleged herein, the defendants violated Sections 5(a) and 

(c) of the Securities Act [15 U.S.C. § 77e(a) & (c)]. 

85. Unless enjoined or otherwise restrained, the defendants will continue to violate 

Securities Act Sections 5(a)  and (c) [15 U.S.C. § 77e(a) & (c)]. 

FOURTH CLAIM FOR RELIEF 
Unjust Enrichment 

(Against Relief Defendant American Quality Cleaning Services, Inc.) 
 

86. The Commission realleges and reincorporates paragraphs 1 through 85 as if fully 

set forth herein. 

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87. Relief Defendant American Quality Cleaning Services, Inc. is an Indiana 

corporation controlled by Coughlin.  Defendants transferred money deposited by OICU and 

OICU2 investors from bank accounts owned by OICU and OICU2 to a bank account in the name 

of American Quality Cleaning Services, Inc.   

88. By reason of the actions alleged herein, Relief Defendant American Quality 

Cleaning Services, Inc. has no legitimate claim to those funds, and has thus been unjustly 

enriched under circumstances in which it is not just, equitable, or conscionable for it to retain 

such profits.  Relief Defendant American Quality Cleaning Services, Inc. is a constructive trustee 

of investor funds and proceeds of the fraud perpetrated by Defendants Coughlin, OICU Ltd., and 

OICU Investments Corp. 

FIFTH CLAIM FOR RELIEF 
Unjust Enrichment 

(Against Relief Defendant Avocalon, LLC) 

89. The Commission realleges and reincorporates paragraphs 1 through 88 as if fully 

set forth herein. 

90. Relief Defendant Avocalon, LLC is an Indiana limited liability company 

controlled by Coughlin.  Defendants transferred money deposited by OICU investors into a bank 

account in the name of Avocalon.  In addition, salaries of Avocalon employees were paid using 

some of the deposits investors made in OICU and OICU2.   

91. By reason of the actions alleged herein, Relief Defendant Avocalon, LLC has no 

legitimate claim to those funds, and has thus been unjustly enriched under circumstances in 

which it is not just, equitable, or conscionable for it to retain such profits.  Relief Defendant 

Avocalon, LLC is a constructive trustee of investor funds and proceeds of the fraud perpetrated 

by Defendants Coughlin, OICU Ltd., and OICU Investments Corp. 

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PRAYER FOR RELIEF 

WHEREFORE, the Commission respectfully requests that the Court enter a judgment: 

(a) finding that Defendants violated the antifraud provisions of the federal securities 

laws as alleged herein; 

(b) permanently enjoining each Defendant from violating Securities Act Sections 5(a) 

and (c), Securities Act Section 17(a), and Exchange Act Section 10(b) and Rules 10b-5 

thereunder. 

(c) permanently enjoining each Defendant from directly or indirectly, including, but 

not limited to, through any entity he or it owns or controls, participating in the issuance, 

purchase, offer or sale of any security, provided, however, that such Order shall not prevent him 

or it from purchasing or selling securities for his or its own personal account; 

(d) ordering each Defendant to disgorge, jointly and severally, all ill-gotten gains, 

plus prejudgment interest thereon, wrongfully obtained as a result of their illegal conduct; 

(e) ordering each Defendant to pay civil penalties pursuant to Securities Act Section 

20(d) [15 U.S.C. § 77t(d)] and Exchange Act Section 21(d) [15 U.S.C. § 78u(d)];  

(f) permanently barring Defendant Coughlin, pursuant to Securities Act Section 20(e) 

[15 U.S.C. §77t(e)] and Exchange Act Section 21(d)(2) [15 U.S.C. §78u(d)(2)], from serving as 

an officer or director of any issuer that has a class of securities registered pursuant to Exchange 

Act Section 12 [15 U.S.C. §78l] or that is required to file reports pursuant to Exchange Act 

Section 13 [15 U.S.C. §78m];  

(g) imposing a constructive trust on Relief Defendant American Quality Cleaning 

Services, Inc, d/b/a Oxford Privacy Group and ordering it to disgorge all funds transferred to it 

from OICU and OICU2 and to pay prejudgment interest thereon;  

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(h) imposing a constructive trust on Relief Defendant Avocalon, LLC and ordering it 

to disgorge all funds transferred to it from OICU and OICU2 and pay prejudgment interest 

thereon; and 

(i) granting such other relief to the Commission as the Court may deem just and 

proper. 

JURY DEMAND 

Pursuant to Rule 39 of the Federal Rules of Civil Procedure, Plaintiff demands that this 

case be tried to a jury. 

Dated: April 11, 2014    Respectfully submitted, 
 
        /s/ Stephan J. Schlegelmilch              
      Stephan J. Schlegelmilch (Ohio Bar No. 0073088) 
      Counsel for Plaintiff 
      U.S. SECURITIES AND EXCHANGE COMMISSION 
      100 F Street, N.E. 
      Washington, D.C.  20549 

Email: [email protected] 
Phone: (202) 551-4935 
Facsimile: (202) 772-9292 

 
Of Counsel: 

 
Bridget M. Fitzpatrick 
C. Joshua Felker 
Adam J. Eisner 
Carolyn Kurr 
U.S. SECURITIES AND EXCHANGE COMMISSION 
100 F. Street, N.E. 
Washington, DC 20549 

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