Order: Stock Scheme Promoters Impersonating Advisory Firm

May 8

Texas Securities Commissioner John Morgan entered an Emergency Cease and Desist Order on May 5 alleging that two investment promoters who are soliciting funds for a stock scheme are falsely claiming to be an existing investment advisory firm in Dallas.

According to the order, Raymond Hill and Mark Diaz are approaching investors and offering to purchase their stock in what is known as an advance fee scheme. Investors who accept ultimately have to pay money to cover costs associated with the transactions.

Hill and Diaz are promoting their advance fee scheme through a fake website, social media, forged documents, and purported affiliations with the IRS. The pair are asking stock owners to pay certain costs to a company in the Philippines.

Hill and Diaz established two websites with names similar to Cain Capital LLC, a firm registered with the Securities and Exchange Commission.

One of the fake sites was created on Wordpress, a free website and blogging platform. It routes visitors to a legitimate regulatory filing Cain Capital made with the SEC. The site also links to a Facebook page and Twitter account purportedly belonging to Cain Capital.

Neither the websites nor social media established by Hill and Diaz are related to Cain Capital, but they create the impression the pair are working with a properly registered investment advisory firm.

Hill and Diaz are also sending unsolicited emails to potential investors in their stock scheme. The emails include documents on letterhead in the name of Cain Capital, and Diaz is listed as “Head of Accounts.”

Hill and Diaz are notifying investors that they have identified a buyer for stock held by a shareholder. The owner of the stock must pay a brokerage fee of 2% of the purchase price of the stock to Cain Capital.

The promoters are also telling stock owners that the IRS collects a tax from the transaction and it must be paid through a third-party bank to Wales Marketing and Consultancy in Makati City, Philippines.

Investors receive an invoice that appears to have been issued by the IRS, and a receipt for payment that Hill and Diaz claim is from the “Department of State, United States Share Registry.”

The invoice lists an address on West Second Street in Austin for the U.S. Share Registry, but there is no such entity or IRS office at that location.