Invest Better 2001 and John and Jane Does 1 through 10
Litigation Release No. 17272 / December 13, 2001
SEC BRINGS CHARGES AGAINST FRAUDULENT
INTERNET OFFERING IN PURPORTED SPORTS BETTING OPERATION
Securities and Exchange Commission v. Invest Better 2001 and John and Jane Does 1 through 10, 01 Civ. 11427 (BSJ) (S.D.N.Y. Dec. 13, 2001)
The Securities and Exchange Commission announced today that it has filed an enforcement action charging Invest Better 2001 ("IB2001") and unidentified persons behind IB2001 with perpetrating a fraudulent, unregistered, ongoing offering of securities over the Internet. The Complaint alleges that IB2001 offers purportedly "guaranteed" and "risk-free" investment programs in which IB2001 pools investor funds to bet on sporting events, and promises to repay investors between 125% to 2500% of their principal within specified periods ranging from three days to several weeks, depending on the program selected. The Complaint, filed in the United States District Court for the Southern District of New York, charges the defendants with violating Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933 ("Securities Act"), Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act"), and Rule 10b-5 thereunder.
The Complaint names as defendants:
- IB2001 is an entity that until Monday, December 3, 2001, operated a website, hosted by a server in New York City, and that and continues to operate a bulletin board at the MSN Networks Communities website. On its website and the MSN bulletin board, IB2001 has held itself out as "the #1 investment service in existence."
- Defendants John and Jane Does 1-10 are unknown individuals or groups of individuals responsible for, or controlling, the Investment Programs offered by Defendant IB2001, the IB2001's website or bulletin board.
According to the Complaint:
Since at least November 14, 2001, the Defendants, through the IB2001 website and bulletin board, have offered, and are continuing to offer, investments into four Investment Programs: (a) the "125% 3 Day Ongoing Program," through which IB2001 promises a supposed 125% return after a three-day investment; (b) the "250% 1 Week Ongoing Program," through which IB2001 guarantees a supposed 250% return after one-week; (c) the "1250% 1 Month Program," through which IB2001 guarantees a supposed 1250% return after a one-month investment; and (d) the "2500% Christmas Miracle Program" through which IB2001 guarantees a supposed 2500% return beginning December 26, 2001 on funds invested between November 10, 2001, and December 15, 2001. The Defendants, through the IB2001 website and bulletin board, represent to investors that the investments in, and returns from, the four Investment Programs are "safe" and "guaranteed." The Defendants further represent that IB2001 generates profits for the Investment Programs by pooling investors' money and placing "safe bets" with three online sportsbooks.
These representations are materially false and misleading. Among other things, gambling by its very nature requires the undertaking of risk, and IB2001 cannot provide risk-free exorbitant returns on investments in the Investment Programs by betting on sporting events. In addition, it is economically not feasible for an issuer of fixed-instruments to provide exorbitant short-term financial returns, in an open-ended offering, which are "risk-free."
The litigation is pending.
![]() | SEC Complaint in this matter. |
Last Reviewed or Updated: June 27, 2023