The Securities and Exchange Commission today charged Paul A. Garcia of Severance, Colorado, for allegedly defrauding investors by stealing approximately one quarter of investor funds raised for Gold Hawgs Development Corp. ("Gold Hawgs"), a failed cryptocurrency venture.

According to the SEC's complaint, filed in the United States District Court for the District of Colorado, from August through October 2019, Gold Hawgs raised $400,000 from 16 investors for the creation of a new cryptocurrency. The SEC's complaint further alleges that Gold Hawgs touted large potential returns for investors after the completion of its initial coin offering, but the business failed before reaching that stage. Instead of using all of the investor funds to develop Gold Hawgs' business, Garcia, the chief financial officer and a 50% owner of the company, allegedly stole approximately $123,000 of the money raised from investors by transferring the funds to another company that he controlled; he then allegedly used the money to pay for various personal and business expenses unrelated to Gold Hawgs.

The SEC's complaint charges Garcia with violating Sections 17(a)(1) and (a)(3) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rules 10b-5(a) and (c) thereunder, and seeks a permanent injunction, disgorgement of all ill-gotten gains plus prejudgment interest, and a civil penalty. The SEC also names Office Guru Franchise Group, Inc., another company controlled by Garcia, as a relief defendant.

The SEC's investigation was conducted by Jacqueline M. Moessner and supervised by Mary S. Brady and Jason J. Burt. The litigation will be led by Leslie J. Hughes and supervised by Gregory A. Kasper.