[ by Howard Haykin ] The SEC obtained a court order on Monday freezing the assets of a Georgia-based investment adviser charged in a $40 million fraud, who apparently has gone into hiding. Aubrey Lee Price allegedly raised money from more than 100 investors living primarily in Georgia and Florida by selling shares in an unregistered investment fund (PFG) that he managed.  Investors were told Price would invest their assets in traditional marketable securities, but he also stayed a bit - making illiquid investments in South America real estate and a troubled South Georgia bank. To conceal the fund's mounting losses, Price created bogus account statements with false account balances and returns, and provided those to investors and bank regulators.

“Price raised nearly $40 million from investors and made woeful financial transactions that he hid from them.  Now both the money and Price are missing." --  William Hicks, Associate Director of SEC's Atlanta Regional Office.

SEC Findings and Allegations. According to its complaint, filed in U.S. District Court for the Northern District of Georgia, the SEC allege that Price, a Manatee County, FL resident who moved to Georgia, began his scheme in 2008.  In the Private Placement Memorandum (PPM) for his PFG fund, Price noted that the fund's investment objective to achieve “positive total returns with low volatility” by investing in a variety of opportunities, including equity securities traded on the U.S. markets. Price deposited a significant portion of PFG investor funds – about $37 million – was placed in a brokerage trading account, where he incurred massive trading losses.  Price further drained the trading account by frequently wiring funds from the trading account to PFG’s operating bank account.  Throughout this time, Price created fictitious client account statements that indicated fictitious amounts of assets and investment returns, but no indication of PFG's trading losses. In June 2012, Price allegedly sent a letter to some investors entitled, “Confidential Confession For Regulators – PFG, LLC and PFGBI, LLC Summary.” This 22-page letter was an admission by Price that he “falsified statements with false returns” in order to conceal between $20 million and $23 million in investor losses. Judge Timothy Batten, Sr. granted the SEC’s request for a temporary restraining order and entered an asset freeze for the benefit of investors against Price, PFG, and his affiliated entities. The SEC requests that anyone with information about Price’s whereabouts should contact the FBI's  Atlanta office, at 404-679-9000, or the Lowndes County Sheriff’s Office, at 229-671-2985.  The SEC investigation continues. SEC Atlanta Regional Office Credits. Investigation by Senior Trial Counsels David Baddley, Kristin Wilhelm, Shawn Murnahan, and Assistant Regional Director Aaron Lipson.  Mr. Murnahan is leading the ongoing litigation. For further details, go to:  [SEC PR 12-127, 7/2/12] and   [SEC Complaint].