U.S. SECURITIES AND EXCHANGE COMMSSION
Litigation Release No. 24019 / December 21, 2017
Securities and Exchange Commission v. Stephen C. Peters, VisionQuest Wealth Management, LLC, VisionQuest Capital, LLC, and VQ Wealth, LLC, Civil Action No. 5:17-cv-00630-D (E.D. NC filed December 20, 2017)
Investment Adviser Charged with Running Ponzi Scheme
The Securities and Exchange Commission today charged a Raleigh, North Carolina-based investment adviser with running a Ponzi scheme that primarily targeted his clients, many of whom were retired and elderly.
The SEC alleges that Stephen C. Peters, through his investment adviser firm VisionQuest Wealth Management, sold promissory notes issued by another one of his companies, VisionQuest Capital, to clients and other prospective investors while making false statements, including that proceeds would be invested into revenue-producing businesses with neither Peters nor his businesses receiving compensation. Peters allegedly claimed that the VisionQuest Capital notes presented little or no risk of loss and were “guaranteed.”
According to the SEC’s complaint, investor funds were not used as Peters claimed. Peters allegedly spent at least $4.4 million on such personal endeavors as remodeling a large farm in North Carolina, purchasing fine art for his home, and constructing a vacation home in Costa Rica. Peters also spent at least $4.9 million to make Ponzi payments to earlier investors.
In a parallel action, the U.S. Attorney’s Office for the Eastern District of North Carolina today announced criminal charges against Peters, including a charge that alleges that Peters attempted to withhold and conceal records from the SEC, fabricated records, and provided false testimony in the SEC’s investigation of Peters’ scheme.
The SEC’s complaint charges Peters, VisionQuest Wealth Management, LLC, VisionQuest Capital, LLC, and VQ Wealth, LLC, with violations of the antifraud provisions of the federal securities laws. The SEC seeks disgorgement of ill-gotten gains plus interest and penalties as well as injunctions.
The SEC’s investigation has been conducted by Edward H. Saunders, Thomas B. Bosch, and John O’Halloran, and the case has been supervised by Aaron W. Lipson, Justin C. Jeffries, and Stephen E. Donahue. The litigation will be handled by Edward G. Sullivan and Thomas B. Bosch. The SEC examination that led to the investigation was conducted by Claudette Williams-Himes, Carole A. Solloway, Todd E. Rogers, Dale R. Perez, Gina Bailey, and Deborah Shaw of the SEC’s Atlanta Office. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Eastern District of North Carolina and the Federal Bureau of Investigation.