A resident of Queens, N.Y., Ian Mitchell, was charged by the U.S. Securities and Exchange Commission with defrauding investors in an offering fraud scheme. Mitchell agreed to settle the SEC’s charges.
In a complaint filed in the U.S. District Court for the Southern District of New York, the SEC alleges that between July 2021 and February 2022, Mitchell solicited investors by misrepresenting his identity, family background and wealth, ability to access private placement stock, and what he intended to do with the investors’ funds. In particular, the SEC alleges that Mitchell used a fictitious name and falsely claimed to be the nephew of an African billionaire.
Mitchell allegedly told the investors that he planned to use their money to purchase pre-IPO stock of two privately owned companies. The SEC also alleges that two investors gave Mitchell approximately $325,000 to purchase stock based on Mitchell’s claims. According to the complaint, Mitchell did not use any of the investors’ funds to purchase stock and instead used the funds to pay his personal expenses.
The SEC’s complaint charges Mitchell with violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Mitchell consented to the entry of a final judgment permanently enjoining him from violating those provisions of the federal securities laws and an officer and director bar. The judgment also orders Mitchell liable for $325,000 disgorgement and $53,072.65 in prejudgment interest, which are deemed satisfied by the restitution and forfeiture orders entered in a parallel criminal action. The settlement is subject to court approval.
Previously, the U.S. Attorney’s Office for the Southern District of New York filed a criminal action against Mitchell, who pled guilty to one count of wire fraud. On July 11, 2024, he was sentenced to a prison term of 44 months followed by three years supervised release and ordered to make $469,999 in restitution and $469,999 in forfeiture.
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