SEC moves against Michael Park

Michael Park

The Securities and Exchange Commission filed suit yesterday against Brentwood financial advisor and accused fraudster Michael J. Park.

The nation's stock-trading regulator seeks an injunction, disgorgement of ill-gotten gains and civil penalties against Park, whose supposed investment business collapsed suddenly in late June.

The complaint echoes lawsuits filed in recent months by investors against Park and against the brokerage house that listed him as an agent.

The SEC accuses Park of violating several provisions of federal securities law. The lawsuit's counts include using interstate commerce for fraudulent purposes, deceptive sales practices and unregistered sales of securities.

"From at least 2001 to June 2008," the agency claims, "Park defrauded at least 20 investors out of at least $6 million" through his Brentwood-based Park Capital Management Group.

"To induce investors to open accounts with him, Park told investors that he and PCMG generated high annualized returns," the complaint says. "For example, one investor invested $1.2 million over a three-month period after Park told him that PCMG's managed accounts had annual returns of 28 percent."

In reality, according to the government, Park used the money that investors placed with his firm for his own personal expenses and to fund a mortgage brokerage that he operated.

The funds went into a $1.7 million house, golf club memberships, and Porsche and Mercedes cars, the lawsuit alleges. Meanwhile, "Park provided fraudulent stock purchase confirmations" and other documentation telling investors their accounts were up by as much as 25 percent in a single quarter.

The complaint asserts that for up to seven years, Park acted "with an intent to deceive, manipulate or defraud, or with a severe reckless disregard for the truth."

Alex Rue, senior trial counsel for the SEC's Atlanta office, filed on behalf of the agency.