The state of Massachusetts has claimed that Allcott was the manager of ARO Equity and together with Renison took $5.8 million of investor funds since August 2015. The complaint alleges that these funds were raised through the sale of unsecured promissory notes promising 8-12% annual returns over three to five-year terms. The complaint alleges that investors made significant investments from their retirement accounts by transferring qualified retirement assets to a self-directed IRA to invest in ARO Equity.
The state of Massachusetts alleges that ARO Equity and its members made material misstatements or omissions of material fact to investors in the sale of its securities. ARO Equity is alleged to have failed to inform note holders of Renison’s criminal and disciplinary history. Further, it was alleged that ARO Equity assured investors that their money is generally safe or somehow guaranteed but have failed to truthfully inform investors of the fund’s past or present performance. Critically, the complaint alleges that ARO Equity principals have received undisclosed and excessive commission payments and executive compensation for soliciting investments and bears the hallmarks of a Ponzi scheme.
The complaint claims that ARO Equity has only “invested” approximately half of the money received from investors and lost most of it. Notwithstanding these losses, the principals are accused of awarding themselves over $1 million of investor capital and Renison alone has taken in over $710,000 in undisclosed commissions. Finally, the complaint states that due to the failure of the fund’s investments to perform, monthly returns to ARO Equity investors are paid using funds raised from other investors – in Ponzi scheme fashion.
The state of Massachusetts alleged that Renison’s son TJ Renison was involved in the ARO Equity scheme. TJ Renison was registered with brokerage firm Horace Mann Investors, Inc. (Horace Mann) through March 2018. TJ Renison failed to appear before Massachusetts enforcement for testimony. Allcott claimed to the division that TJ Renison has a 5% ownership stake in ARO Equity and serves as a member of the limited liability company in lieu of and as nominee for his father.
Investors who have suffered losses may be able recover their losses through securities arbitration. The attorneys at Gana Weinstein LLP are experienced in representing investors in cases of investment fraud and brokerage firms failure to supervise their representatives. Our consultations are free of charge and the firm is only compensated if you recover.