Regulatory Receivership Cases
Federal Trade Commission vs. American Tax Relief
Mr. Seaman was appointed as Receiver for American Tax Relief on September 27, 2010. The FTC has alleged that American Tax Relief induced consumers to pay exorbitant fees for purported tax relief services by making false claims and material misrepresentations to consumers about whether consumers actually qualify for particular tax relief programs and about American Tax Relief’s ability to significantly reduce their debts. The Receiver ceased all alleged fraudulent activities and took steps to administer pending claims from customers with qualified claims.
Securities and Exchange Commission vs. Medical Capital Holdings Inc.
Mr. Seaman was appointed as Permanent Receiver on August 20, 2009 in a securities fraud enforcement action brought by the Securities and Exchange Commission. The Commission has alleged that the defendants violated federal securities laws. Medical Capital was a lender making loans secured by medical accounts receivable and other loans and investments. The multifaceted case involves debt collection, debt restructuring, note sales, asset sales, management of operating companies, litigation seeking damages for legal malpractice, aiding & abetting, and breach of fiduciary duties, among others, support to related and criminal litigation, and taxation issues. To date the receiver has recovered approximately $120 million for the benefit of the receivership estate and investor/victims. Thomas Seaman Company performed a forensic accounting of over $10 billion in transactions from 258 bank accounts covering a six period and which sets forth how investor funds in excess of $1.7 billion were spent. The information provided in the accounting is being used to locate assets, determine possible sources of recovery including disgorgement, file amended tax returns, and form the basis for a plan of distribution to investor/victims.
Securities and Exchange Commission vs. Safevest
Federal Equity Receiver in securities fraud enforcement action involving a Ponzi-scheme purportedly using futures trading. Criminal charges are pending.
Securities and Exchange Commission vs. Carolina Development
Offering fraud case for a purported real estate development company. Significant misrepresentation of assets. Uncooperative defendants. Volatile investor base. Liquidated land holdings in excess of $40 million. Several substantial interesting legal issues. Over thirty disgorgement actions filed. Filed suit against four separate attorneys for malpractice or other breaches of fiduciary duty. SEC won Motion for Summary Judgment and obtained judgment for $29 million against defendant largely on the basis of receiver’s investigation and forensic accounting. Assisted with development of Plan of Distribution and expect to distribute approximately $10 million to investor victims. Supported governmental agencies in criminal actions.
Securities and Exchange Commission vs. Nathanson et al
$80 million securities fraud case with 2,600 investor victims. Ponzi scheme combined with a legitimate golf club manufacturer. Performed forensic accounting identifying recipients of ill gotten gains; highly complex accounting, 20 bank accounts at 6 banks for 15 corporate entities, extensive use of kiting, etc. Successful prosecution of professionals. Auction. Seized real property and personal property assets. Criminal referral, defendant indicted and incarcerated.
People of State of California vs. Theodore Swain
Receiver appointed to identify, seize, and liquidate assets for the benefit of investor-victims and distribute proceeds.