Jaime A. Verdugo, of Phoenix, was ordered by the Arizona Corporation Commission to pay $381,954 in restitution and a $20,000 administrative penalty for committing securities fraud.
Commissioners found Verdugo was not registered to offer or sell securities in Arizona when he solicited multiple promissory note investors, most of whom were from Hispanic Christian communities.
Verdugo told investors, on behalf of Verdugo Enterprises, LLC, that their money was going to purchase home decor products to fulfill online orders. However, the Commission found Verdugo mislead investors by stating their money was safe while knowing at least eight prior investors did not receive any investment returns.
Verdugo failed to inform investors about the company’s unwritten policy to limit payouts to $6,000 every two weeks, which is contrary to the explicit terms of the promissory notes.
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