Grand Forks, Fargo business owners accused of Ponzi scheme, ordered to cease and desist
FARGO, N.D. (Valley News Live) - The State of North Dakota Securities Department has ordered a Grand Forks man and a Fargo man to cease and desist. They’re accused of misappropriating investor funds.
Michael R. Kuntz of Grand Forks operated and 2 controlled the entities National Sports Opportunity Partners, LLC and ICON Investment Group, LLC. Jeremy L. Carlson of Fargo operated and controlled Jamieson Capital Financial, LLC, as its President and sole member. Carlson also represented himself as Treasurer for National Sports Opportunity Partners, LLC.
At one point, the state agency alleges the men were wiring funds to Beijing, China with no explanation. They state:
Money invested by Chad Miller was used for the following transactions: outgoing wire transfer from JCF Bell Bank account in the amount of $2,500,000.00 to Zhongce Rubber Group Co. Ltd, a Chinese tire manufacturer and a $750,000.00 outgoing wire transfer from JCF Bell Bank account to Mallwood Park. The $2,500,000.00 outgoing wire transfer to Zhongce Rubber Group Co. Ltd., sent on May 26, 2022, was returned on June 10, 2022. The same day that the wire to Zhongce Rubber Group Co. Ltd. was returned, $2,500,000.00 was sent via outgoing wire from JCF Bell Bank to Wenzhou Kingpak International Co. Ltd., a Chinese industrial machine manufacturer and this wire was returned on June 16, 2022. Both wire transfers were returned from Industrial and Commercial Bank of China, located in Beijing, China. Carlson at no time has provided to the Department any explanation as to why a state registered investment adviser firm was involved in facilitating these transactions.
This document detail all the findings. Notably:
From October 4, 2021, when the promissory notes were sold, up until the date of this order, NSOP and Kuntz have taken possession and control of investor money and misappropriated investor money by using it to pay fees related to alternative financing commitments from unlicensed money brokers and to make interest payments to earlier investors in a Ponzi-like manner. Respondents NSOP and Kuntz each engaged in at least forty-three violations of N.D.C.C. § 10-04-15. Respondents Carlson and JCF have also taken possession and control of investor money and misappropriated investor money by using it for personal expenses, both Carlson and JCF engaged in at least thirty-one violations of N.D.C.C. § 10-04-15.
The order alleges that Respondents Kuntz and NSOP illegally engaged in the offer for sale and/or the sale of unregistered promissory notes or other evidence of indebtedness in the amount of at least $1,955,000.00 to private fund entities controlled by Carlson.
From on or about October 4, 2021 to July 22, 2022 a total of at least $25,430,946.51 was paid by wire, bank transfer, personal check and/or cashier’s check from various individuals and entities to entities and accounts controlled by Kuntz and/or Carlson in exchange for unregistered debt securities.
An additional $8,500,000.00 was solicited by Respondents to secure alleged alternative financing in the amount of $50,000,000.00.
To read the full document from Securities Commissioner Karen Tyler, click here.
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