Fraud charges, originally filed against Columbus, Ohio-based Paramount Financial Partners LP and its President Von Cummings, have been extended to include six additional men the agency claims made off with large sums of investor money.
The SEC claims Kevin Hightower and five other marketers were responsible for bringing in $6.4 million in new investments to the fund. Hightower reportedly kept $137,000 for his fee and passed $583,000 to the other men involved.
Between May 2000 and March 2001 investors were told by Paramount Financial and the marketers that investments in a particular hedge fund would return as much as 99%. In reality, there was no such fund and the money raised went to repay previous investors, cover expenses and marketing commissions.
The SEC is seeking to permanently bar the six men from securities related activities and to have all the money returned to investors with additional civil penalties.