This week, the Securities and Exchange Commission charged a former Georgia state legislator and member of the Georgia Board of Regents with defrauding at least 100 investors in the now-bankrupt energy development company, Allied Energy Services LLC. Clarence Dean Alford was charged this week.
The SEC’s complaint shows that from 2017 to 2019, Alford fraudulently raised at least $23 million by selling promissory notes to investors and guaranteed he would provide high annual rates of return. Most of the victims were Indian-American professionals. The complaint alleges that Alford presented Allied Energy Services as a successful business.
In reality, it was struggling. Alford claimed investors’ funds would help finance energy projects. Most of the funds were allegedly used to make interest payments to earlier investors. The SEC accuses Alford of using some of the funds for personal expenses including building a multimillion-dollar home. The scheme supposedly collapsed when Alford failed to make promised interest payments to some investors and failed to repay their principal in 2019.
Alford has consented to the entry of a judgment finding he violated the antifraud provisions of the federal securities laws without admitting or denying the allegations. It also orders permanent and conduct-based injunctions. He has also agreed to the amounts of civil penalties, disgorgement, and prejudgement interest that will be determined b the court at a later date.