Scam-o-Ramma Sunday brought to you by Kelly G Rogers plus one

Good morning everyone.

Like counting down the days to the big game, we are now approaching the 30 DAY mark until the scammer faces his day in court.

What will life be like once the trial is over, once Rogers is sentenced and is rotting in jail? Once Carrie moves back into her parents condo complex and vacates the status of her current home? Once the greater Frisco investing and Church community is safe from his financial shell games?

I don't know but I can't wait!

Today we get to revisit a scam called LEVEL PAR. It's a snap shot into the creation of a Ponzi scheme. It was sent to us under a cloak of secrecy, in the cover of darkness. Two people, meeting in an alley, in a driving rain storm. Lightning and thunder....you got the "Package"? Here you go! Nondescript manilla envelop passed between two individuals in raincoats. Then the two parties slither off into the darkness. Nothing short of a Tom Clancy movie!

Notice there are TWO names associated with this presentation?

It's an EIGHT slide deck and presented to honor the SEC and Marshall Gandy's successful prosecution of Kelly G Rogers.

State Subpoenas SEC Attorney Marshall Gandy for Kelly G Rogers Trial

As the State of Texas prepares for the trial of Kelly G Rogers,  I've noticed they've subpoenaed Marshall Gandy.

Mr. Gandy is the associate regional director and examinations at US Securities and Exchange Commission.

More importantly, Mr. Gandy was the prosecuting attorney in 2007 for the SEC v. Global Finance Investments, Inc., et al which was Kelly Rogers and his Level Par Ponzi Scheme.

This is significant because Rogers' has clearly violated the terms of his agreed final consent.

Under the agreed terms of the Consent, the Defendant (Kelly G Rogers) agreed to the order that; 

(i) permanently restrains and enjoins Defendant from future violations of Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933 ("Securities Act") [15 U.S.C. §§ 77e(a), 77e (c) and 77q(a)], and Section 10(b) of the Securities Exchange Act of 1934 (the "Exchange Act") [15 U.S.C. § 78j(b)] and Rule 10b-5 promulgated thereunder [17 C.F.R. § 240.10b-5];

(ii) orders Defendant to pay disgorgement in the amount of $100,000, plus prejudgment interest thereon in the amount of $3,360; and (iii) orders Defendant to pay a civil penalty in the amount of $50,000 under Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d) of the Exchange Act [15 U.S.C. § 78u(d)].

Further, it spelled out; "...by using any means or instrumentality of interstate commerce, or of the mails, or of any facility of any national security exchanges, in connection with the purchase or sale of any security;

(a)  to employ any device, scheme, or artifice to defraud;

(b)  to make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading or

(c)  to engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person. 

In the "CONSENT OF DEFENDANT KELLY G ROGERS document, on page 5 it simply says;

"If Defendant breaches this agreement, the Commission may petition the Court to vacate the Agreed Final Judgement and restore this action to its active docket". 

So SEC, let's get to it! 

A reader asks; How much money did Kelly Rogers give to LEGACY CHRISTIAN ACADEMY

A recent comment opens the door to a very interesting subject:

"Has anyone looked into the Football Stadium that Legacy Christian built around 5 years ago when Rogers' was active and serving on the Board? There are rumor's money was funneled possibly to the construction of the stadium as Legacy was very small at that time and Kelly Rogers" was apparently its biggest donor."

Legacy Christian Academy is an awesome organization. We admire and appreciate them for doing God's work. We need a ton more God in America and by no means is this story meant to demean Legacy.

However, the transactions which resulted in the May 2012 indictments for fraud, theft of property and money laundering, all took place between August 22nd of 2007 and October 28th of 2011. This is right in the middle of when Rogers was serving on the board at Legacy.

So the reader is asking an obvious question; who's money was it that Kelly G Rogers donated to Legacy Christian Academy? Was it yours? Further, was he a "HERITAGE" level investor of $250,000 or more? 

So we're suggesting that someone follows to money.

The Facts Seem Clear

Clearly, Kelly Rogers was serving on the board at the time same time he was wheeling and dealing. 

The graphic to the left shows an auction held on November 3rd, 2007 and the graphic below, pulled from the same PDF, lists Kelly Rogers as a board member in 2007 and 2008. According to the indictment, this is the exact time when the allegedly  fraudulent transactions were being completed.

And what if he serviced on the board from 2005 through 2009? That would open up the possibility that ANY money donated during this time-frame could have come from the Level Par Ponzi Scheme, the Falcon Energy project, the Buck Hamilton Series or other "Deals" offered by Rogers.

Do you know how much of "Other Peoples Money" was lost during that time-frame? It was well over $6.3 Million. And this number doesn't include the $6.4 owned to creditors at the time of his bankruptcy filing on July 27th, 2009.

If it can be proven that Rogers stole, laundered, then donated this funny money to Legacy, what's the legal status of those donations? Can the authorities take legal action against Legacy, naming Legacy as a relief defendant and recover the stolen funds?

If we review Kelly G Rogers money raising history, it starts in late 2004 and seems to peak in 2009 . Specifically, he rolls out of the Travis-Correll Ponzi Scheme and starts Level Par where, according to the SEC, page 11, item 47: "Rogers raised $4.7 million from approximately 35 investors".

Then look a the indictments issued by the Collin County DA's office, Theft PC 31.03 F1 , Rogers is accused of stealing $1,589,000 and they list 29 specific entities affected. Combined, that's $6.3 Million. 

How hard would it be to peel off $250,000, give it to Legacy and even write off the donation on his taxes!

So this reader is correct in wondering if any donations were laundered funds taken from unsuspecting investors. The entire list of investors is in the indictment? click here.

Our thanks to this reader for bringing up this issue. I'm sure the Texas State Securities Commission or the Collin County DA's office has enough subpoenaed information to answers these questions.

BREAKING DOWN KELLY ROGERS INDICTMENTS

As he prepares for his appearance in Judge Rusch's court on the 8th,  let's take a closer look at the indictments faced by Kelly G Rogers

In a law abiding society, a line clearly exists between right and wrong, good and evil, black and white. If a society is to enjoy law and order, people of sound mind choose to honor boundaries because it's the right thing to do.

Attorney Kelly Rogers seems to be of a sound mind. Judging from his ability to impress the average investor, one would assume he's smart enough to recognize them. Yet, after reading the indictments, it appears he simply ignored them.

Much of this reminds me of Bill Clinton during his perjury charges. He posed the now famous question; "It depends on what the meaning of the word 'is' is". Everything to Bill Clinton was some shade of gray. No right, no wrong....just shades of gray. Is this a lawyer thing, arrogance or both?

Clinton was suspended from practicing law in Arkansas and paid a $250,000 fine as a result of Monica Lewinski incident.  He was also disbarred from practicing law in front of the Supreme Court and he's the first sitting president to be held in contempt of court for lying under oath. So it is with arrogant lawyers.
 
I found this wonderful example to illustrate the point about Rogers.   

On July 9th, 2007, Kelly G Rogers signed an "Agreed Judgement" to settle his part in the lawsuit Sec vs. Global Finance & Investments, Inc., et al (Page 11: Rogers' fraudulent offering).

Rogers was sued for his involvement in the Level Par Ponzi scheme that he and his former partner, Richard Weyand operated. As part of the settlement, he paid a small fine, got a slap on the wrist and out the door practically unscathed.

THEN 44 DAYS LATER, HE'S AT IT AGAIN!

If you read cause 380-81034-2012, Rogers is indicted for Theft PC 31.03 F1, Securities Fraud; Article 581, Section 29 C (1) of Texas Securities Act, and Money Laundering TPC 34.02 F1.

Detailed in the indictment, Rogers appears to have walked out from signing the SEC Agreement on July 9th and 44 days later he's already got a new DEAL he's spinning to unknowing investors. He begins to accept new money on August 22nd from DFG LP and Nick Diguseppe.

Amazing...only 44 days later. I wonder if this new deal was in the works as he signed his name to the SEC agreement?

In the indictment for Security Fraud, it lists three specific charges; 

1. Failing to disclose a lawsuit from 2/16/07 for allegedly committing violations of the federal securities act, the Securities Act of the State of Texas, common law fraud and breach of his fiduciary duties to the petitioners in connection with the sale of investments in an oil and gas venture located in the Vinton Dome in Louisiana. 
2. Failing to disclose a 7/18/2007 lawsuit filed by the US District Court for the Eastern District of Texas styled as SEC vs. Global Finance & Investments, Inc alleging in part that Rogers violated provisions of the federal securities laws.
3. Failing to disclose that funds invested by previous investors in Falcon Energy LLC and Buck Hamilton Series were used for purposes other than those for which said funds were invested. 

Let's see if Kelly Rogers shows up to court with an attorney as directed. It'd be appropriate if it was Bill Clinton.

The Level Par Scam by Kelly G. Rogers

Yep, the scam that started the down hill spiral of Kelly G. Rogers, Lawyer of Frisco Texas. On the fast track to rebuild his home, Rogers set off on a Bernie Madoff pace that caused many of Kelly G Rogers friends, acquaintances and those in his Amway down-line to lose Millions of dollars.

After all, what are friends for? 

SEC v. Global Finance & Investments, Inc. et al. Case 4:07-cv-00346

18. "Kelly G. Rogers, age 47, is a resident of Frisco, Texas and was the managing member of Level Par until July 2006, when he was forced to resign after the other Level Par members discovered he had diverted Level Par’s funds to his personal bank account. Rogers was a member of the Texas Bar Association until April 2005, when his license was suspended for failure to pay Texas’ occupational tax". (Page 5 & 6)

IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF TEXAS
SHERMAN DIVISION, Case SECURITIES AND EXCHANGE COMMISSION vs. GLOBAL FINANCE & INVESTMENTS, INC.

Page 11:  Roger’s fraudulent offering:

43. In January 2006, Clark told Kelly G Rogers that Clark had invested with Global Finance and was receiving profits from Global Finance’s program. In fact, drawing from the representations in Davis’s December 20, 2005 joint venture amendment, Clark represented to Rogers that he had $100 million invested in the Global Finance investment program.

44. In February 2006, after Rogers expressed an interest in participating in Global Finance’s program, Clark introduced Kelly G Rogers to Davis. According to Rogers, Davis offered him a “totally secure” high-yield program involving the purchase and sale of bank debentures that paid monthly returns of up to 25 percent. Davis touted the fact that the funds would be safely deposited in an attorney’s trust account and would not be withdrawn until an actual transaction commenced or an instrument was purchased.

45. In February 2006, Kelly G Rogers was the managing member of Level Par and its sole contact with Global Finance. Kelly G Rogers, using Level Par as a pooling vehicle, conducted an offering, and invested the proceeds with Global Finance. Based on Davis’s representations, Rogers prepared Level Par’s offering documents, promising investors monthly returns ranging from three to 10 percent. Kelly G Rogers orally represented to Level Par investors that their principal was not at risk because it remained in an attorney’s trust account. Rogers also told investors that the funds would be used as collateral to trade in various bank debentures or mortgage backed securities. Kelly G Rogers told one investor that “the World Bank would have to collapse to lose his investment.” Rogers raised $4.7 million from approximately 35 investors and wire transferred all of it to Global Finance in February and March 2006.

46. Rogers knew that Davis’s claims were fraudulent. First, Rogers was an investor in Correll’s scheme, a similar high-yield investment program, which had ceased making promised payments. Also, Rogers was on notice that these investments were scams when he learned of the Commission’s allegations in the Correll civil action in which Robbie Gowdey, Rogers’s friend and neighbor, was charged with violations of the federal securities laws.

47. Nevertheless, on February 13, 2006, Rogers caused Level Par to enter into a joint venture agreement with Global Finance, and a trust account agreement with Dippolito, containing terms similar to Clark’s and Schliemann’s agreement with Davis.

In the end, many investors we talked with have never gotten ONE PENNY of money back from the Level Par investment. In the meantime, has Rogers curbed his fund raising activities? NO. But surely he's seen the light and now enables his investors to rake in huge profits to rebuild his reputation as a rain-maker, right?

What do you think? Maybe you should ask those who've invested with Rogers in the past years to get the answer?

In the meantime, let's all look ahead to the February trial for justice to be served.