SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
Litigation Release No. 17218 / November 2, 2001
Securities and Exchange Commission v. Don D. Lukens, individually and
doing business as Community Group Funding and Global Sports &
Entertainment; J.C., Inc.; and James Carter Allison, individually and
doing business as Select Assets, no. CV 01-09410 SVW (AJWx) (C.D.
Cal.)
SEC CHARGES CALIFORNIA MAN WITH DEFRAUDING MORE THAN 100 INVESTORS,
INCLUDING PROFESSIONAL ATHLETES AND RETIREES, IN MULTI-YEAR SCHEME;
SEC ALSO ACTS TO PREVENT BANKRUPTCY DISCHARGE
The Securities and Exchange Commission ("Commission") today announced
that on November 1, 2001 it filed a civil injunctive action in federal
district court in Los Angeles, California accusing Don D. Lukens, an
unregistered investment adviser and broker-dealer operating in Oxnard,
California, of defrauding at least 100 investors of millions of
dollars in a series of schemes throughout the late 1990s. In a
separate action on November 1, 2001, the Commission also commenced a
related adversary proceeding against Lukens in United States
Bankruptcy Court in Santa Barbara, California, where Lukens is a
debtor, seeking to prevent the discharge of the substantial portion of
Lukens' indebtedness incurred through securities fraud.
Named in the district court complaint are
* Donald D. Lukens, 50, of Camarillo, California. Lukens conducted
business through two unincorporated proprietorships that he owned
Community Group Funding, a mortgage broker, and Global Sports and
Entertainment, an unregistered investment advisory firm that
catered to professional athletes and other wealthy individuals.
Lukens operated both firms out of posh offices in Oxnard,
California.
* James Carter Allison, 50, of Roscoe, Texas, who worked for CGF and
Global in 1998 and 1999.
* J.C. Inc., a Nevada shell corporation established in 1998 and
secretly controlled by Lukens.
The Fraudulent Conduct
According to the district court complaint
* Lukens fraudulently induced more than 100 investors to entrust him
with millions of dollars to invest in a series of unsuitable,
mortgage-backed securities laden with significant undisclosed
risks. In soliciting these funds, Lukens routinely and falsely
described the investments as "safe" and "secure," promised high
SNIPPETS:
Securities and Exchange Commission v.
Don D. Lukens, individually and doing business as Community Group Funding and Global Sports &
SEC CHARGES CALIFORNIA MAN WITH DEFRAUDING MORE THAN 100 INVESTORS, INCLUDING PROFESSIONAL
Named in the district court complaint are * Donald D. Lukens, 50, of Camarillo, California.
Lukens conducted business through two unincorporated proprietorships that he owned Community
* James Carter Allison, 50, of Roscoe, Texas, who worked for CGF and Global in 1998 and 1999.
According to the district court complaint * Lukens fraudulently induced more than 100
In soliciting these funds, Lukens routinely and falsely described the investments as "safe"
* Lukens also misappropriated or diverted millions of dollars that clients and customers
Of the more than 100 victims thus far identified, the complaint alleges that Lukens
payoff date, and at least $1.6 million that he never invested; and * at least $7.5 million, and
The complaint alleges, however, that the total number of Lukens' victims may well exceed 200
Central to Lukens' fraudulent schemes was the vulnerability of the customers and clients he
Lukens' victims included his pastor, fellow parishioners at his church, his children's former
Operating through Global Sports & Entertainment, Lukens also attracted additional investment
Allison, at Lukens' direction, knowingly conducted transactions through two shell entities,
Violations of the Federal Securities Laws
The Commission's district court complaint charges that Lukens acted as an unregistered
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