Craig Allen Allegedly Defrauded Cheetah Fund Investors

Craig Allen (CRD# 2625516[1]), formerly a broker registered with Avatar Securities, defrauded investors in The Cheetah Fund, according to pending regulatory enforcement actions. MDF Law is investigating the former Atlanta-based owner of C.M. Allen Capital for similar conduct. If you lost money on investments he recommended, contact our law firm for a free consultation. 

To learn more about the allegations against Mr. Allen, continue reading this post. The information below is based on a September 24, 2024 review of his BrokerCheck profile, a Financial Industry Regulatory Authority record. 

SEC Alleges Cheetah Fund Fraud

On April 24, 2024, the Securities and Exchange Commission announced charges against Mr. Allen. According to a litigation release[2], the SEC alleged that he defrauded investors in a hedge fund he created and controlled, The Cheetah Fund. Between 2019 and 2023, the SEC alleges, he raised investments totaling about $9.9 million in the fund. He allegedly did so “by lying about the fund’s supposedly superlative performance.” Far from performing highly, investors with accounts in the fund and in C.M. Allen—a related entity—incurred realized trading losses of more than $4.59 million. 

The SEC’s complaint alleges further that Mr. Allen made false representations to investors that The Cheetah Fund “used a specific accounting firm as an auditor and to prepare its Schedule K-1 tax forms.” He also allegedly received more than $2 million in compensation from the fund and its investors, even though his compensation was purportedly performance-based. As alleged, investors in the Fund have received only $900,000 back from Allen, “resulting in investor losses of approximately $9 million.”

Filed in the United States District Court for the Northern District of Georgia, the SEC’s complaint charges Mr. Allen with violations of the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Advisers Act of 1940. Among other penalties, it seeks civil penalties, disgorgement, and a permanent bar from acting as an officer and director. The charges are still pending.

Connecticut Banking Commissioner Files Cease-and-Desist

On May 20, 2024, the Connecticut Banking Commissioner issued a cease-and-desist order, order to make restitution, notice of intent to fine and notice of right to hearing[3] concerning Mr. Allen. Like the SEC complaint, this order alleges that he violated Connecticut securities law when he sold unregistered offerings in The Cheetah Fund to investors in the state. It alleges specifically that his violations included “making inflated unsubstantiated earnings claims to investors, falsely representing that The Cheetah Fund had been audited, [and] falsely representing that a famous investor had invested in The Cheetah Fund.” In addition to the above, the order alleges further that he directed investor funds toward personal expenses. The action is still pending.

FINRA: Craig Allen Previously Based in Atlanta

Craig Allen launched his career as a broker in 2011, when he registered with Chimerica Securities. Over the subsequent years, he went on to work with T3 Trading Group and Avatar Securities. He founded C.M. Allen Capital Management in 1997, according to BrokerCheck, and worked at its office in Atlanta, Georgia. He is no longer registered as a broker or an investment adviser.

MDF Law Can Help You Recover Losses

Did you suffer losses on investments in The Cheetah Fund? You may have recovery options. Call MDF Law if your broker did not fully explains the risks of your investments, provided misleading information, or otherwise recommended unsuitable products. Our clients only pay a fee if they recover losses, and our attorneys offer free consultations nationwide. Your time to file a claim may be limited, so don’t delay. Call 800-767-8040 today.