Friday, 2 November 2007

Tracking Down The Real Internet Crooks Capital Enhancement Club (CEC)

These are real criminals. They are pocketing real millions and never getting arrested. I guarantee that after you finish reading the final article in this series on CEC, your jaw will drop and you will say out loud, “Wow”.

Peeling an onion, much like uncovering a scam, is never a pleasant experience and can bring tears to your eyes. Sometimes, as in the case of CEC, after all the scam layers are gone and you pull aside the curtain to see who is really operating the scheme…the answer might just surprise you!

Securities and Exchange Commission v. David Tanner, individually and d/b/a Capital Enhancement Club, Rocky D. Spencer, Marroc Corp. and Richard P. Kringen, Defendants, and, Omnibus, LLC, Vectra Resources, LLC and Dynamic Environmental Solutions, Inc., Relief Defendants, Civil Action No. 05-4057-SAC

This SEC document identifies, three civil defendants, David Tanner an unknown, Rocky D. Spencer, a convicted felon and recidivist fraudster, and Richard P. Kringen (”Kringen”), one of CEC’s salesmen.*ceclubreceiver

When you first look at this SEC Document, Civil Action No. 05-4057-SAC, it is not possible to fully understand the events and people involved by reading only the header as shown here. It displays only names and often dates.

Let’s peel away a layer and look deeper.

Please Remember - This is just a civil action and no criminal charges have been filed. Also in the interest of fairness, please note that Rocky Spencer and his mother Margaret without admitting or denying the allegations in the Commission’s Complaint have both reached a mutual settlement with the SEC. The settlement between the SEC and Rocky (Defendant) required him to return $454,158.54, representing profits gained as a result of the conduct alleged in the Complaint. The receiver tells me that they no longer have an interest in or the authority to investigate Spencer’s current activities. Just in case you want to take a look, here are some of the web businesses he currently operates……

Background on Defendants and the case

Richard P. Kringen - On December 16, 1994, the Securities Commissioner of the State of Kansas filed a cease and desist order, showing that through Diversified Consultants, Richard P. Kringen around 68 years of age at the time, solicited the Kansas Public Employees Retirement System to invest in a transactions involving Prime Bank Guarantees with the “top fifty World Banks” and promised his investors an annual return of 50%. Docket No. 95E042 *ceclubreceiver (.pdf) The SEC has repeatedly deemed prime bank schemes a security in enforcement actions, and high yield investment schemes are so similar to prime bank schemes that they should be treated the same. Richard’s final judgment in the CEC scam shows he was ordered to disgorge the amount of $226,113.30 representing his ‘cut’ plus an additional interest amount of $17,410.66.

Rocky D. Spencer - On July 22, 1994 Rocky D. Spencer ( plead guilty to conspiracy to defraud the Unites States, money laundering, wire fraud and structuring transactions to evade reporting requirements. Spencer served 60 months in prison. This conviction was the result of an successful investigation and prosecution by the Criminal Investigation Division of the Internal Revenue Service. The Marroc Corp. is a Virginia corporation, controlled by Spencer with its principal place of business at Spencer’s residence in Newport News, Virginia. He is listed as president and secretary.

David Tanner - This is an alias and he is considered a recidivist securities law violator. His background requires much more than just a paragraph so please keep reading and you will eventually come to his ‘resume’.

May 2005

The SEC filed an emergency civil enforcement action [SEC Complaint] on May 4, 2005 in the United States federal court in the District of Kansas. On that same day, United States District Court Judge Sam A. Crow issued an order [SEC Memorandum In Support of TRO] temporarily restraining defendants David Tanner, individually and doing business as Capital Enhancement Club (“CEC”), Rocky D. Spencer, Marroc Corp. (“Marroc”) and Richard P. Kringen from violating the antifraud provisions of the U.S. federal securities laws.

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