The Arizona Corporation Commission (ACC), a regulatory state agency, has ordered Gary Martin of Phoenix and his affiliated company Reliant Income Properties LLC to pay $25,000 in restitution and a $10,000 administrative penalty for selling unregistered securities in connection with a fictitious real estate investment.
An investigation by the ACC determined that Martin and Reliant, who were not registered to offer or sell investments in the state, misrepresented to an investor that Reliant owned property with tenants and an income stream that would provide revenue for investors. In reality, Reliant had no real assets and no income.
Additionally, the ACC found what while Reliant’s offering documents pledged that investor monies would be set aside in an escrow account with a major bank until a certain amount was raised, Martin immediately began spending investor funds on personal expenses, including the payment of his mother’s rent and his purchase of a Harley Davidson motorcycle.
Execution will stop fraud.