On Dec. 23, 2024, the U.S. District Court for the Central District of California entered final consent judgments against Christopher Slaga a/k/a Keith Renko and his companies, Q4 Capital Group, LLC and J4 Capital Advisors LLC. The entry of the final consent judgments resolves all claims arising out of the SEC’s complaint, filed on Aug. 7, 2023, which alleged that the defendants defrauded at least 17 investors when they raised $3.5 million between 2018 and 2022 through an unregistered offering of interests in three purported private investment funds.
The complaint charged Slaga, Q4 Capital Group, and J4 Capital Advisors with violations of Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 and Section 10(b) the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
The SEC’s complaint alleged that Slaga, a recidivist, operated his fraudulent scheme under the alias “Keith Renko.” According to the complaint, Slaga, through the entities he controlled and posing as Renko, marketed and sold interests in three private investment funds that he managed. Slaga, age 49 at the time of the complaint, represented to investors that he would use their funds to execute certain securities trading strategies. The SEC alleged that, in reality, Slaga never formed the investment funds, did not trade securities on behalf of the investment funds, and misused the vast majority of investor money for personal expenses.
Moreover, as alleged in the complaint, to conceal his fraud, Slaga forged documents that purported to reflect that the investment funds had brokerage accounts at a major firm, were audited by a Big Four auditor, and were profitable. The complaint alleged, however, that the funds did not have brokerage accounts, were not audited by any firm, and were not profitable.
Of the approximately $3.5 million of investor funds that defendants raised, Slaga used nearly $2.9 million on personal expenses including, among other things, travel, jewelry, and rent for properties in Florida, the Bahamas, and Barbados. Slaga also used a portion of these investor funds to trade securities in his personal brokerage account for his own benefit and incurred trading losses of more than $450,000.
The final judgments ordered Slaga, Q4 Capital Group, and J4 Capital Advisors to pay, jointly and severally, disgorgement of approximately $2.81 million plus prejudgment interest thereon of $262,495.31, and permanently enjoined them from violating the antifraud and securities-registration provisions of the federal securities laws identified above and from participating in the issuance purchase, offer, or sale of any security, with certain limited exceptions for Slaga.
Additionally, the district court ordered Slaga to pay a civil penalty of approximately $2.81 million and to be permanently enjoined from serving as an officer or director of any public company.
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