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Dear Robert,
The Securities and Exchange Commission today charged James O. Ward, Jr., a Foley, Alabama resident, with defrauding investors by making numerous misrepresentations in selling investments in Apex Financial Institute Pvt. Ltd. ("Apex"), a private investment fund managed by Ward and his partners that raised at least $852,000 of crypto assets from approximately 70 investors in the United States and abroad.
According to the SEC's complaint, in March and April 2021, Ward live-streamed several Apex investor presentations and then posted the videos on YouTube. The SEC alleges that, in those videos, Ward promoted Apex as a hedge fund, and falsely claimed, among other things, that Apex: (i) was regulated by the SEC; (ii) had $25 million in assets under management; (iii) had successfully conducted a 12-month beta test of its trading strategies; (iv) employed trading strategies that offered investors the opportunity to experience substantial gains without any risk of loss; and (v) had several international offices. The SEC alleges that, in reality, Apex was never an SEC-regulated entity, did not exist prior to February 2021, had no assets under management prior to taking on investor funds, and never had $25 million in assets under management. The complaint also alleges that Apex's claimed "beta test" was based solely upon returns purportedly achieved by one of the third-party funds in which Apex planned to invest, and Apex did not have trading strategies that actually protected investors from losses. The SEC further alleges that Apex never had any offices and operated entirely from Ward's and his partners' home computers.
The complaint, filed today in the United States District Court for the Southern District of Alabama in Mobile, charges Ward with violating Sections 17(a)(1) and (3) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint seeks permanent injunctive relief, a bar preventing Ward from serving as an officer or director of a public company, and a civil money penalty.
The SEC's investigation was conducted by Douglas M. Dykhuizen of the Atlanta Regional Office and supervised by Thomas B. Bosch. Pat Huddleston will lead the litigation, under the supervision of M. Graham Loomis.
The Law Offices of Patrick J. Burns, Jr., P.C., is a nationally recognized securities law firm dedicated to assisting breakaway advisors transitioning to independence and serving the legal needs of established investment advisory firms. Our team works with individuals establishing their own investment advisory firms, as well as those joining existing practices. PJB Law’s key services include investment advisor registration, transition counseling, mergers and acquisitions, outsourced general counsel, business entity formation, employment/partnership agreement review and handling promissory note issues. Our firm’s highly skilled professionals provide legal assistance to a variety of individuals, from those with small books of business to advisors with multi-billion dollar practices.
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