Goodman & Nekvasil P.A. May Recover Investor Losses – Essex Capital Corporation Charged by SEC
The Securities and Exchange Commission has charged Essex Capital Corporation, an equipment leasing company and its founder, Ralph Iannelli, with defrauding investors in connection with sales of over $80 million in promissory notes.
According to the SEC’s complaint, between 2014 and 2017, Essex Capital Corporation and its founder, Ralph T. Iannelli, made a series of false and misleading statements and illusory personal guarantees to registered investment advisers to induce them to invest millions of dollars of their clients’ money in Essex’s failing equipment leasing business. The SEC alleges that Essex and Iannelli provided one investment adviser with fake financial statements that overstated Essex’s assets by more than $20 million and falsely told another investment adviser that Essex would assign equipment leases to its clients when the same leases had already been pledged as collateral for bank loans. The SEC’s complaint further alleges that as Essex’s finances deteriorated, the company resorted to frequent Ponzi-like payments, paying interest and principal to existing Essex investors with funds raised from newer investors. At the same time, Iannelli allegedly paid himself millions of dollars in bonuses and siphoned millions of dollars out of Essex through interest-free loans with no maturity date. According to the SEC, Iannelli personally owes the company over $6.4 million.
The SEC alleges that Iannelli has raised capital for Essex by soliciting his friends and members of his community, who are high net worth individuals in and around Santa Barbara, California, to invest in Essex. The complaint alleges that some of these friends and community members referred other investors to Essex. Iannelli typically offered investors promissory notes as the investment vehicle, where the interest rate and other terms of their investments were set forth. The complaint alleges that the promissory notes that Iannelli offered investors between 2014 and 2017 typically promised investors interest of approximately 8.5 percent interest, but occasionally as high as 10 percent interest, and in or around 2011, occasionally as low as 3 percent interest. The complaint alleges that Essex’s promissory notes were securities in the form of investment contracts involving the note holders’ investment of money, in a common enterprise, with the expectation that returns on the notes would be derived from the efforts of Iannelli and Essex. The complaint alleges that Iannelli also raised capital for Essex by borrowing money from a local bank in Santa Barbara and at least one other financial institution and has, on at least two occasions, raised capital through soliciting registered investment advisers looking for higher yield investments for their clients.
Investors in Essex Capital Corporation May Recover their Losses with Goodman & Nekvasil, P.A.
If you purchased your Essex Capital Corporation investment from a licensed financial advisor, Goodman & Nekvasil, P.A. can help you. Goodman & Nekvasil, P.A., a Clearwater, Florida, law firm with a national practice representing victimized investors, has filed hundreds of cases against brokerage firms selling high-risk or fraudulent investments such as Essex Capital Corporation, and has recovered more than $180 million dollars on behalf of victimized investors.
All our cases are handled on a purely contingency fee basis by Kalju Nekvasil, Esq., formerly regional counsel with the NASD, now known as FINRA. Kalju Nekvasil, Esq. has practiced in this area of the law for more than 35 years.
There is no charge for an evaluation of your case. Further, we handle our cases on a contingency fee basis. This means that unless we recover money for you, we charge no attorney’s fee. Unless you recover any money, you pay us nothing, not even the costs and expenses which the firm will advance on your behalf. Finally, the filing of such a case should not affect your ownership of your Essex Capital Corporation investment.
If you incurred losses on your investment in Essex Capital Corporation and would like your case evaluated by a securities attorney (again, there is no charge for an evaluation and all cases are handled on a purely contingency fee basis), please contact us.
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