A New York court yesterday granted the US Securities and Exchange Commission (SEC) an emergency interim order against an international investment company which has operated partly out of Ireland and which is alleged to have defrauded some 150 investors in 20 countries of $2 million (€2.15 million).
Most of those who are said to have lost money are from Ireland and the UK. Millennium Financial Ltd was ordered to desist from fraudulent activity, described as "an international boiler room" operation, and its assets were frozen by Judge Michael Mukasey of the Southern District Court.
He also ordered the repatriation to the US of all the funds raised in the course of the alleged fraud.
The company, which claimed to be an international consulting firm based in Uruguay with offices in several countries, in fact, according to the SEC, did not have such offices. Its operations in Ireland were also conducted without the required authorisation of the Central Bank, according to a statement from the SEC.
The statement claims that Millennium solicited investments by phone, making false claims about initial public offering (IPOs) in three US companies, Key Card Communications, kNutek Holdings, and Sonic Gardens Inc.
In the case of Key Card, Millennium solicited investments in pre-IPO shares, suggesting that their value would soar tenfold after the IPO. The company never had an IPO and the SEC issued a warning to investors about the dangers of trading in pre-IPO shares.
The SEC acknowledged the assistance of a number of police forces in carrying out the investigation which involved investor funds from Australia, Belgium, Denmark, England, France, Germany Greece, Indonesia, Ireland, Italy, Luxembourg, Malaysia, The Netherlands, New Zealand, Portugal, Saudi Arabia, Scotland Singapore, Sri lanka, Sweden, Switzerland, the US, and the UAE.
The SEC is seeking a permanent order against the company and financial penalties. The court also issued the same order against Newport Fiduciaries and Nominees because the latter received investor funds at the direction of Millennium.
