The Securities and Exchange Commission charged Jefferey A. Gordon of Dallas, Texas and two companies he controls with defrauding at least 18 investors out of nearly $1 million in a real estate investment scheme.

The SEC's complaint alleges that Gordon sold investors interests in his company, Windy City Accelerated Returns Venture I, LLC, which he claimed would use investor funds to acquire stakes in other companies that operated lucrative rental properties near Chicago, Illinois. According to the complaint, Gordon told investors that these rental properties were "100% rented" and that he would further enhance their value by refinancing loans on the properties to get lower interest rates. Gordon also allegedly told investors that he would use their funds to renovate and update the properties, so that they could be leased at higher rates and ultimately sold at a premium. The SEC alleges that Gordon assured investors that these efforts would "conservatively" generate returns of 250% to 350% in three to five years.

According to the complaint, Gordon's representations were materially false and misleading. The complaint alleges that Gordon instead misappropriated most investor funds for unrelated expenditures and personal items such as luxury hotels, vacation rentals, gambling, and private school payments.

The SEC's complaint charges the defendants with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint also charges the defendants with violating the registration provisions of Sections 5 of the Securities Act. The complaint requests permanent and conduct-based injunctions, an officer and director bar, disgorgement of ill-gotten gains with prejudgment interest, and civil penalties.

As set forth in the complaint, Gordon was enjoined in a previous SEC action from violating the antifraud, registration, and unregistered broker-dealer provisions of the federal securities laws.

Jim Etri and Carol Hahn in the SEC's Fort Worth Regional Office conducted the investigation, under Eric R. Werner's supervision. Nikolay V. Vydashenko will lead the litigation, supervised by B. David Fraser.