Attorney Marcus Luna was charged in a civil action, along with 3 associates and 4 "accredited investor" entities for their roles in a multi-million dollar scheme and for selling shares of Axis Technologies Group, Inc. stock in a public distribution without registration with the Commission.  Also named in the suit:  Nathan Montgomery, Adam Daskivich, and David Murtha;  St. Paul Venture Fund, Minnesota Venture Capital, Real Estate of Minnesota, and Matrix Venture Capital.

    SEC Allegations.    Luna drafted and issued a legal opinion letter to a transfer agent that falsely stated the shares of Axis were unrestricted because they were issued pursuant to a valid exemption from registration under Rule 504 of Regulation D.  Luna further misrepresented that St. Paul VF, Minnesota VC, Real Estate MN and Matrix VC were accredited investors in Minnesota, and claimed that Minnesota state law permitted an exemption allowing accredited investors to purchase unrestricted shares from Axis.

The SEC contends that, in reality, these entities were not accredited investors, and were simply conduits for distribution of the stock to the public.  Soon after these alleged accredited investors received their shares, they transferred shares to promoters and sold the remaining shares to the public.  Luna, Montgomery, Daskivich and Murtha received profits totaling $6.88 million from the sales by the 4 entities. 

The SEC's complaint seeks from Montgomery, Daskivich, Murtha, St. Paul VF, Minnesota VC, Real Estate MN and Matrix VC:  (i) permanent injunction;  (ii) disgorgement of profits, including prejudgment interest;  (iii) civil penalty;  and  (iv) a penny stock bar.  The SEC seeks to prohibit Marcus Luna from providing professional legal services to any person in connection with the offer or sale of securities pursuant to, or claiming, an exemption under Regulation D, including, without limitation, participating in the preparation or issuance of any opinion letter related to such offerings. 

For further details, click onto:  [SEC Complaint, Case 2:10-cv-02166, 12/14]   [SEC Litigation Rel. 21779, 12/15]