The SEC charged Jason Galanis, his father John Galanis, and five associates with defrauding investors in sham Native American tribal bonds in order to steal millions of dollars in proceeds to fund their own extravagant expenses and criminal defense costs. The SEC alleges that Jason and John convinced a Native American tribal corporation to issue limited recourse bonds they had previously structured, acquired two investment advisory firms, and installed officers to arrange the purchase of $43 million in bonds using clients’ funds. The SEC alleges that instead of investing bond proceeds as promised in annuities to benefit the tribal corporation and generate sufficient income to repay bondholders, the money wound up in a bank account in Florida belonging to a company controlled by the defendants. The misappropriated funds were used for the purchase of luxury goods and to pay attorneys representing Jason and John in a criminal case brought parallel to fraud charges brought by the SEC last year. SEC
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