U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23221 / March 27, 2015
Securities and Exchange Commission v. Gregory W. Gray, Jr., et al., Civil Action No. 15-cv 1465 (LAK)
U.S. District Court Appoints a Receiver Over Archipel Capital LLC, and BIM Management LP and the Relief Defendants and Issues Preliminary Injunction Order Extending Asset Freeze in Ponzi-Like Scheme
The United States Securities and Exchange Commission announced that on March 25, 2015, the Honorable Lewis A. Kaplan, United States District Court for the Southern District of New York, appointed Lucien A. Morin as the receiver over certain assets of Archipel Capital LLC, BIM Management LP and the Relief Defendants, which comprise the various funds controlled by Archipel and BIM. The receiver is responsible for marshaling and safeguarding those assets held by these entities.
On February 27, 2015, the Commission filed a complaint alleging, among other things, that Gregory W. Gray, Jr. and his firms Archipel and BIM fraudulently used money from three investment funds to pay fictitious returns to investors in a different fund. Today, the Commission also announced that on March 23, 2015, the Court issued a preliminary injunction order on consent continuing the asset freeze, restraining the defendants from violating the antifraud provisions of the federal securities laws, and ordering other relief.
The Commission's complaint charges Gray and his firms with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1), 206(2), and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder. Gray is additionally charged with aiding and abetting Exchange Act Section 10(b) and Rule 10b-5 violations. The Commission's complaint seeks disgorgement against all defendants and a financial penalty. The relief defendants whose assets are subject to the receivership are Archipel Capital - Agrivida LLC, Archipel Capital - Amyris Biotechnologies LP, Archipel Capital - Bloom Energy LP, Archipel Capital - Late Stage Fund LP, Archipel Capital - Lineagen LP, Archipel Capital - Social Media Fund LP, Archipel Capital - Social Media Fund II LP, Archipel Capital - Social Media Fund LP 3, Archipel Capital - Social Media Fund LP 4, and Bennington - Everloop LP.
Investors may direct their inquiries to the receiver, Lucien A. Morin, II, at (585) 546-2500, or at receiver@mccmlaw. Information on the receivership can be found at http://www.mccmlaw.com/archipel-capital-receiver-info.