Macon-based investment group scammed investors out of more than $3 million, lawsuit says

The U.S. Securities and Exchange Commission, in a civil filing late last week, alleged that a Macon-based investment group defrauded at least three investors out of more than $3.3 million.

In a lawsuit filed Friday in federal court, the SEC sought an injunction to shut down Black Lion Investment Partners, Inc., and have its management return to investors all “ill-gotten gains.”

The government claims Black Lion used “a prime bank scheme” to mislead investors by promising that investors’ funds would remain in an escrow account and earn lucrative returns without any risk of loss. In reality, the SEC claims, the investors’ funds were transferred out of the purported escrow account.

The SEC also is asking a judge to decide if civil penalties are warranted against Black Lion, which started in Wyoming in 2019 but presently uses Macon as its main place of business.

Besides the investment group, the SEC is suing three of Black Lion’s executives:

• President and CEO Edward L. Wooten, 48, of a Tucker Road address in Macon.
• President Lee S. Rose, 79, of Deerfield, Illinois.
• Chief Financial Officer John L. Krcil, 52, of Hanover, Minnesota.

Criminal charges could come later based on the filing, which cites multiple counts of fraud.

In Friday’s civil filing, the SEC alleges the company and its officers told two investors that trading in a specific security would produce returns of up to $5 million per week. A third investor was promised monthly returns of 7% and equity in an energy company if he sent funds for a supposed corporate financing transaction.

“In fact,” the filing states, “the vast majority of investor funds were … disbursed to accounts controlled by the defendants and used for personal expenses or used to pay returns to earlier investors.”

In one case, the lawsuit contends “Wooten used a large portion of the investors’ funds … to purchase and renovate a home, among other things. Rose and Krcil used funds they received for personal expenses.”

None of the investors had received their money back, the lawsuit said.

The SEC said its investigation was continuing and that a jury trial is requested.

Telegraph reporter Joe Kovac Jr. contributed to this report.

This story was originally published August 3, 2021 at 9:46 AM.