First TARP Fraud Charges Announced

Submitted by Melissa Hoffmann on Fri, 01/30/2009 - 14:28

Congratulations to Gordon B. Grigg and his firm ProTrust Management, Inc., for the shared distinction of being the first targets of a TARP-related fraud proble.

The Securities and Exchange Commission today took emergency action to charge the Nashville, Tenn.-based investment advisor with securities fraud, and obtained a court order freezing their assets. The SEC alleges that Grigg and ProTrust defrauded clients out of at least $6.5 million and misrepresented that their money was invested in the federal government's Troubled Asset Relief Program and other securities that, in reality, do not exist.

According to the SEC's complaint, Grigg is a self-purported financial planner and investment advisor, but neither he nor his firm is registered with the SEC or a state regulator.

Some kind of TARP fraud was bound to happen eventually, but doesn't this feel a little soon? And it certainly doesn't make the Treasury Department's reported lack of oversight of the program seem any less dangerous.

 

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