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WEST JORDAN — A West Jordan man has been charged with operating a Ponzi scheme that cost investors nationwide $100 million.
Wayne L. Palmer, who calls himself "the Wayniac," allegedly told investors their money would be used to make real estate loans and to buy mortgage notes and real estate assets. More than 600 people invested, according to a complaint filed by the Securities and Exchange Commission in the U.S. District Court for the District of Utah.
The SEC has obtained a temporary restraining order and asset freeze against Palmer and his firm, National Note of Utah, LC.
"Palmer promised double-digit returns at his real estate seminars, where investors learned the hard way about his lies and deceit," said Kenneth Israel, Director of the SEC's Salt Lake City Regional Office.
Palmer allegedly told investors their money would be secure and that they could expect a 12-percent return on their investment. He said investors were guaranteed payment even if property owners missed payment on loans held by his firm, according to the complaint.
The SEC alleges that National Note in reality used most of the money from new investors to pay earlier ones, and that the company would not have survived beyond 2009 had this not been the case.
Palmer stopped making most payments to investors in October 2011, but continued to solicit new investors, according to the SEC.
Palmer is being charged by the SEC with violating anti- fraud and securities registration provisions of U.S. securities laws, as well as with operating as an unregistered broker-dealer.
