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Jack C. Ridall and Guss Capital, LLC (Release No. LR-25624; Jan. 24, 2023)

Litigation Release No. 25624 / January 24, 2023

Securities and Exchange Commission v. Jack C. Ridall and Guss Capital, LLC, No. 1:23-CV-20200-DPG (S.D. Fla. filed January 18, 2023)

The Securities and Exchange Commission today announced that it filed an emergency action, and obtained an asset freeze, against Miami investment advisers Jack C. Ridall and Guss Capital, LLC (“Guss Capital”) for allegedly committing securities fraud through a scheme to deceive investors using fabricated audit reports and attorney letters.

According to the SEC’s complaint, which was filed in the U.S. District Court for the Southern District of Florida and unsealed today, the SEC alleges that from at least December 2020, Ridall and Guss Capital represented themselves as successful money managers and raised approximately $750,000 from at least four investors by representing that they would invest their money in a private fund. The defendants allegedly deceived investors by never investing their money as promised, using fabricated audit reports appearing to be from the global accounting firm KPMG LLP claiming Ridall managed $101 million in assets, and sending fake attorney letters purportedly from the international law firm of K&L Gates LLP lying about investors’ profits. The SEC’s complaint alleges that the defendants misappropriated more than 75% of investor funds for personal expenses such as luxury vehicles, fine dining, and jewelry and shopping sprees in Miami Beach.

The SEC’s complaint charges the defendants with violations of the antifraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934, and Sections 206(1), (2), and (4) and Rule 206(4)-8 of the Investment Advisers Act of 1940. The SEC seeks, among other relief, an asset freeze, a permanent injunction, disgorgement of ill-gotten gains plus prejudgment interest, and civil money penalties. The complaint also names Ridall’s wife, Shannon A. Sharp, as a relief defendant due to her allegedly receiving over $94,000 in investor money for no apparent legitimate purpose and seeks disgorgement and prejudgment interest from her.

The SEC’s continuing investigation is being conducted by Michael J. Gonzalez, Patricia Lehtinen Silva and Mark Dee, under the supervision of Jason R. Berkowitz, Fernando Torres, and Glenn S. Gordon in the Miami Regional Office. The SEC’s litigation is being led by Russell Koonin, Mr. Gonzalez and Ms. Silva, and supervised by Teresa J. Verges.