Dallas Resident Charged by SEC in Connection with $85 Million Purported Timber Harvesting Ponzi SchemeThursday, February 27, 2020
Dallas, Texas resident, Michael Billings, and his company, MDB Group, LLC were recently charged with selling unregistered securities in connection with Madison Timber Properties, LLC (Madison Timber), a company previously charged in an $85 million Ponzi scheme.
The complaint, filed in federal court in Jackson, Mississippi, alleges that Billings and his company were one of Madison Timber’s top revenue producers, selling over $80 million of its unregistered securities to 44 retail investors out of approximately $85 million of total securities sold in the scheme. Billings and others involved in the scheme told investors that their funds would be used to finance the right to harvest timber from landowners in the Southeast United States. Madison Timber promised annual returns of 12 to 15 percent through profits that would be generated by reselling the timber rights to timber mills. However, the SEC asserts that Madison Timber never obtained harvesting rights and the company’s principal, Arthur Lamar Adams, forged deeds and cutting agreements and used investor funds for personal expenses, including purchasing real estate unrelated to timber harvesting.
Billings, through MDB Group, began selling the securities in 2012 and continued the scheme through April 19, 2018. Billings earned a percentage commission on the sales and a monthly stipend that, combined, totaled $3.5 million in commissions. Neither Billings nor MDB Group was registered with the SEC.
The SEC charges Michael Billings and MDB Group, LLC with violating the securities registration provisions of the Securities Act of 1933 and the broker-dealer registration provision of the Securities Exchange Act of 1934. Billings and his company have agreed to a settlement in which they are permanently enjoined from violating the charged provisions and the amount of disgorgement, prejudgment interest and civil money penalties will be determine by a federal court at a later date. Billings and his company have also agreed to penny stock bars.
If you invested and lost money in Madison Timber Properties, LLC securities at the advice of a broker, attorney, insurance agent, financial advisor, or CPA and lost money, you may be able to recover your loss. Call us today at 1-877-410-8172 for a free consultation.