SEC Obtains Multi-Million Dollar Final Judgment in Advance Fee Loan Scam Targeting Home Building Industry

November 1, 2019/US SEC

The Securities and Exchange Commission has obtained final judgments against the defendants in an advance fee loan scam involving bogus prime bank instruments.

On October 17, 2019, the United States District Court for the District of Maryland permanently enjoined Defendants Michael K. Martin and Capital Source Lending LLC from violating Sections 5 and 17(a) of the Securities Act of 1933 (“Securities Act”) and Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934 (“Exchange Act”). The Court also enjoined them from directly or indirectly participating in the issuance, offer, or sale of any security, with the exception of the purchase or sale of securities listed on national securities exchanges. Martin was further enjoined from violating Section 15(a) of the Exchange Act.

The Court ordered Martin and Capital Source Lending to disgorge $2,689,660 plus $341,130 in prejudgment interest jointly and severally, and assessed a civil penalty against each of them in the amount of $3,030,791.

As to Defendant Thomas H. Vetter, the Court permanently enjoined him from violating Section 15(a) of the Exchange Act, and from aiding and abetting violations of Section 17(a) of the Securities Act and Section 10(b) and Rule 10b-5 of the Exchange Act. The Court enjoined Vetter from directly or indirectly participating in the issuance, offer, or sale of any security, with the exception of the purchase or sale of securities listed on national securities exchanges. The Court ordered Vetter to pay $143,326 in disgorgement plus $19,772 in prejudgment interest, and a civil penalty of $163,098.

Defendants North Star Finance LLC, Thomas G. Ellis, and Yasuo Oda, previously consented to the entry of permanent injunctions against them. In its October 17 order, the Court ordered North Star to disgorge $2,062,255 plus prejudgment interest of $256,905 and to pay a civil penalty of $2,319,160. Ellis was assessed $822,282 in disgorgement and $101,941 in prejudgment interest jointly and severally with North Star, and was ordered to pay a separate civil penalty of $924,223. Similarly, Oda was ordered to pay $683,498 in disgorgement and $84,736 in prejudgment interest jointly and severally with North Star, and was ordered to pay a separate civil penalty of $768,234.

Finally, the Court ordered Relief Defendants Goodwill Funding Inc. and Charel Winston to pay disgorgement and prejudgment interest jointly and severally of $159,313.

The SEC’s investigation was supervised by Timothy N. England. The SEC’s litigation was led by Patrick R. Costello and Matthew B. Reisig, and supervised by Frederick L. Block. The SEC appreciates the assistance of the Federal Bureau of Investigation’s Buffalo Field Office.

For further information, see Litigation Release No. 23262 (May 14, 2015).

2 Comments

  1. Michella Amonson

    Why is Charel Winston able to continue prime bank fraud ? She pled guilty to stealing Ms. Amonson’s entire retirement fund January 7, 2029.
    Charel Winston’s telephone calls, while incarcerated,were recorded where she continue to arrange to collect large funding from more innocent victims. The discovery is public yet she pled guilty and got credit for time served and walked out a free woman and restitution wasn’t even listed on the probation order to repay Ms Amonson the ordered $19,500.00. It reads that she doesn’t have to pay anyone if probation is successfully completed in 60months but was reminded she faced an 11 tear sentence with 25 to life should she repeat offend to hoard animals or sell securities.

  2. Michella Amonson

    The community needs be aware Charel Winston falsely acts as an attorney, a bank trustee, a business funding corporation, and contacts real estate investors through private money goldmine contacts online to target people with money that she promises a large return on the investment.
    Ms Winston made a comment she could pay her fines and restitution to the court should she get sentenced and released Jan 7 2020. The court ordered no contact with Ms Amonson and did not transfer the Judges minute order to pay restitution on Ms Winston’s probation order

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