In a recent SEC press release, Jason Galanis, his father John Galanis, and five others were charged with stealing millions of dollars from investors. The Securities and Exchange Commission press release stated Jason and John Galanis, as well as Devon Archer, Bevan Cooney, Hugh Dunkerley, Gary Hirst and Michelle Norton, were charged “with defrauding investors in sham Native American tribal bonds in order to steal millions of dollars in proceeds for their own extravagant expenses and criminal defense costs.”
The SEC alleges that the father and son team convinced a Native Amercian tribal corporation to issue recourse bonds and to later invest the bond proceeds in annuities to benefit the tribal corporation and generate income to repay bondholders. In total, the SEC alleges $43 million in bonds were purchased using investor funds. Instead of investing the bonds as promised, the SEC complaint alleges the investor funds were used at very high end retailers for luxury purchases and to pay legal fees for Jason and John Galanis’ criminal case brought alongside the SEC stock fraud charges.
The press release alleges that this scheme is not Jason Galanis’ first brush with the SEC, stating in the past he had “an accounting fraud case during his days as a major Penthouse shareholder” as well as “stock fraud charges last year.”
The U.S. Attorney’s Office for the Southern District of New York filed criminal charges against the same seven individuals listed in the SEC complaint. For more details, read the press release here.