Did You Invest in Zona Energy Through Arete Wealth?
MDF Law is investigating customer complaints related to Arete Wealth Management’s recommendation of Zona Energy Inc. The law firm is interested in speaking to anyone who invested in Zona Energy, Inc. between October 2019 and May 2020. Call us at 800-767-8040 for a free and confidential consultation.
The Allegations Against Arete Wealth
The Securities and Exchange Commission (SEC) has filed charges against Joey Miller, Jeff Larson, and Randy Larson—formerly dual registrants with Arete Wealth Management LLC (a broker-dealer) and Arete Wealth Advisors LLC (an affiliated investment adviser)—for allegations of fraud, registration violations, and aiding Arete Wealth Management in violating recordkeeping rules. The SEC also charged Arete Wealth Advisors, along with its Chief Compliance Officer and General Counsel, UnBo (Bob) Chung, for federal securities law violations tied to concealing the representatives’ alleged misconduct and other compliance failures. Additionally, Arete Wealth Management faces charges for recordkeeping violations.
These actions relate to a previously described scheme involving Richard Dale Sterritt, Jr. and six others, who allegedly defrauded investors through a sham oil-and-gas company, Zona Energy Inc. According to the SEC, between October 2018 and May 2020, despite Zona securities being unapproved by Arete, Miller, Jeff Larson, and Randy Larson sold over $8 million in Zona shares to Arete clients—a prohibited practice known as “selling away.” The complaint alleges the defendants concealed these sales by using personal phones and email, avoiding Arete’s surveillance systems. Furthermore, Miller and Jeff Larson allegedly misled potential investors and were compensated with discounted Zona shares for their fundraising efforts.
The SEC claims that once Chung and Arete management discovered these investments, they instructed Miller, Jeff Larson, and Randy Larson to secure settlement agreements absolving Arete and its management from liability related to Zona. However, these agreements—signed by over 100 Arete clients—allegedly included false and misleading statements and an illegal liability disclaimer, potentially misleading clients into waiving non-waivable claims, thereby exacerbating the harm to already defrauded investors.