Military Personnel Victims of $50 Million Scam

Karen Jowers, a staff writer for Military Times, reported this week that state and federal agencies are looking into an investment scheme that targeted many service members. Affects have spread to 23 states so far, and to Afghanistan and Iraqi troops.

Some $17 million in assets have been frozen by court order, according to Mark Plowden, spokesman for the South Carolina Attorney General's Office. The bank assets belong to Capital Consortium Group, Inc and 3 Hebrew Boys LLC., according to Military Times.

Jowers reported that Plowden said, "But we hear the total investments could be as high as $50 million."

Both companies are listed under the same address and phone number in Columbia, South Carolina, reported Jowers. According to her report, officials stated they believe most of the alleged victims are based in North Carolina.

The South Carolina Attorney General is looking in to allegations that the company is in violation of state securities laws. According to Military Times, the companies used "fraudulent sales practices". Allegedly, the securities being sold were not properly registered, either.

Instead of investing the funds, as promised, authorities reported bank records allegedly show the money going to three company officials. The three named were Tony Pough, Tim McQueen and Joseph Brunson. As of June 13th, no charges had been filed, according to the Military Times.

A "cease and desist" order was issued by the North Carolina secretary of state. The companies have been ordered to stop selling unregistered securities.

According to court documents, most investments made were in the $1,000 to $5,000 range. One person listed in the documents was reported as investing more than $50,000.

Captain Timothy Sers, an attorney out of Fort Benning, Georgia said the Army Criminal Investigation Division is looking into this matter, according to the Military Times. Mr. Plowden said this scheme has not only affected the U.S. Army, but all branches of the military.

Anyone with information in this matter is asked to contact the South Carolina Attorney General's Office at (803) 734-3970. Troops in Fort Benning who have invested are being told to contact their staff judge advocate office asap at (706) 545-3285. Other service members are to call the legal office at their installation. They can also contact military investigative agencies.

Source: Military Times, Karen Jowers; Officials: Scheme May Have Cost Troops $50 M, http://www.militarytimes.com/money/financial_advice/military_ponzi_070621w/