According to the U.S. Securities and Exchange Commission (SEC), the SEC has filed an emergency civil enforcement action to halt an ongoing affinity fraud and Ponzi scheme orchestrated by Buffalo-based Gen-See Capital Corporation a/k/a Gen Unlimited ( Gen-See ) and its owner and president, Richard S. Piccoli.
According to the SEC's complaint, the defendants have raised millions of dollars from investors by promising steady, guaranteed returns, ranging from 7.1% to 8.3% per annum, and no fees or SECs. In November 2008 alone, the defendants raised over $500,000 from investors. The defendants have relied heavily on advertisements in newsletters published by churches and dioceses. The complaint further alleges that the defendants told investors that their money was invested in high quality residential mortgages that the defendants were able to purchase at a discount. The defendants did not invest the funds as promised, but instead used new investor funds to make payments to earlier investors. In addition, the complaint alleges that Gen-See's offering and sale of securities to the public was not registered with the SEC.

The complaint alleges that the defendants violated Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5.

The SEC seeks, among other emergency relief, a temporary restraining order (i) enjoining the defendants from future violations of the federal securities laws; (ii) freezing the defendants' assets; (iii) directing the defendants to provide verified accountings; and (iv) prohibiting the destruction, concealment or alteration of documents. In addition to this emergency relief, the SEC seeks preliminary and permanent injunctive relief and civil money penalties against the defendants as well as disgorgement by the defendants of their ill-gotten gains plus prejudgment interest.

The SEC's investigation is ongoing.