On April 22, 2011, the Securities and Exchange Commission obtained an emergency court order to shut down a Beverly Hills, Calif. hedge fund and wealth management business targeting retirees, university professors, and members of the Christian community.
The SEC alleges that IU Group Inc., its principal Elijah Bang, and its salesperson Daniel Lee targeted retirees and claimed on websites to have been founded by “devoted Christians who believe in God, Jesus Christ, and the Holy Spirit.” Lee allegedly also sent “cold call” e-mail solicitations to university professors.
It appears that IU Group was unsuccessful in obtaining any hedge fund investors or wealth management clients before the SEC’s emergency action halted its operations.
According to the SEC’s complaint filed in federal court in Los Angeles, Bang and Lee made numerous false representations to potential investors and wealth management clients, including the following statements:
The hedge fund was operational and had a successful performance history since January 2007.
The majority of IU Wealth’s clients are professional athletes, actors, producers, doctors, professors, politicians, and executives of private corporations.
IU Wealth has over $800 million under management.
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