Ronald Pallek
U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 26264 / March 11, 2025
Securities and Exchange Commission v. Ronald Pallek, Civil Action No. 2:25-cv-00364 (E.D. Wis. filed Mar. 10, 2025)
SEC Charges Illinois Man in Fraudulent Securities Offering
On March 10, 2025, the Securities and Exchange Commission filed a complaint against Ronald Pallek of Lakemoor, Illinois alleging he defrauded at least 87 investors in a scheme that raised over $1.5 million.
The SEC’s complaint filed in federal court in the Eastern District of Wisconsin alleges that, between February 2021 and September 2023, Pallek raised funds from investors promising to double their money within a year by investing in an Iron Condor options trading strategy. The complaint further alleges that Pallek misrepresented the risks of investing using the Iron Condor strategy and lied to investors that he had sufficient funds to cover any potential trading losses. The complaint also alleges that Pallek sent investors false account statements and used some investor funds to make Ponzi-like payments to early investors. In the fall of 2023, when some investors requested the return of their funds, the complaint alleges that Pallek falsely told them that his bank had frozen his accounts but later admitted to investors that he had lost the money trading.
The SEC’s complaint, charges Pallek with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Section 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder. Simultaneously with the filing of the complaint, the SEC submitted a consent to a judgment whereby Pallek agrees to be enjoined from further violations and to a ruling from the court at a later date as to monetary sanctions.
The SEC’s investigation was conducted by Scott Tandy and Larry Brannon and supervised by C.J. Kerstetter, of the SEC’s Chicago Regional Office. The SEC’s litigation will be led by Christopher White.
The SEC coordinated the filing of these civil charges with the U.S. Attorney’s Office for the Eastern District of Wisconsin, which today announced a plea agreement with Pallek related to the same conduct alleged in the SEC’s complaint.