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UNITED STATES DISTRICT COURT
CASE NO.
COMPLAINT FOR INJUNCTIVE AND OTHER RELIEF Plaintiff, Securities and Exchange Commission ("Commission") alleges that: INTRODUCTION 1. The Commission brings this action to restrain and enjoin Defendants from continuing to violate the federal securities laws in connection with their ongoing, fraudulent, unregistered offer and sale of securities in the form of promissory notes and investment contracts. Unless immediately restrained and enjoined, Defendants will continue to defraud the investing public and place investor funds at serious risk of diversion and theft. DEFENDANTS 2. Defendant Americash-Inc.com, Inc. ("Americash.com") is a Florida corporation incorporated in December 2001, with principal offices located at 7100 W. Camino Real, Suite #310, Boca Raton, Florida 33434. 3. Defendant National Business Concepts, Inc. d/b/a Americash ("National Business") is a Florida corporation incorporated in December 2001, with principal offices located at 7100 W. Camino Real, Suite #310, Boca Raton, Florida 33434. 4. Defendant Norman Benjamin ("Benjamin") is seventy-six years old and resides in Tamarac, Florida. Benjamin is the president and director of Defendants Americash.com and National Business. RELIEF DEFENDANT 5. Relief Defendant World Business Systems, LLC d/b/a World Business Systems, Inc. ("World Business") is a Nevada limited liability company with offices located at 7100 W. Camino Real, Suite #310, Boca Raton, Florida 33434. Relief Defendant World Business has received at least $140,000 in investor funds. Benjamin is the managing member of Relief Defendant World Business. JURISDICTION AND VENUE 6. This Court has jurisdiction over this action pursuant to Sections 20(b), 20(d) and 22(a) of the Securities Act of 1933 ("Securities Act"), 15 U.S.C. §§ 77t(b), 77t(d) and 77v(a), and Sections 21(d), 21(e), and 27 of the Securities Exchange Act of 1934 ("Exchange Act"), 15 U.S.C. §§ 78u(d), 78u(e) and 78aa. 7. Certain of the acts and transactions constituting violations of the Securities Act and the Exchange Act have occurred within the Southern District of Florida. The principal offices of Defendants Americash.com and National Business are located within the Southern District of Florida. Defendant Benjamin resides in the Southern District of Florida. Relief Defendant World Business' principal offices are located within the Southern District of Florida. Defendants have engaged in many of the acts and practices complained of herein within the Southern District of Florida. 8. Defendants, directly and indirectly, have made use of the means and instrumentalities of interstate commerce, the means and instruments of transportation and communication in interstate commerce, and the mails, in connection with the acts, practices, and courses of business complained of herein. THE FRAUDULENT SCHEME Background 9. Americash.com and National Business (collectively referred to as "Americash" or "the company") are purportedly engaged in the business of providing payday advances, or deferred deposits, to the general public. Americash purports to make an "instant short-term [cash] advance available up to two weeks before a person's payday." The borrower ostensibly signs an agreement with Americash pursuant to which the company will give the borrower a cash advance for up to $500. In return, the customer authorizes Americash to debit his or her bank account at a later date --usually within in two weeks-- for the amount of the loan plus a 15% fee. Americash claims that its loans are "conveniently available by Internet, telephone or one of [its] many retail outlets located across the US and Canada." 10. Americash is controlled and operated through its principal, Benjamin. 11. Benjamin ignores the corporate form and treats both Americash.com and National Business as interchangeable entities under the name "Americash." Consequently, Americash.com and National Business are the same issuer of Americash's securities. 12. Americash claims to raise funds from investors to use as payday advances to its customers and to expand its business. The company represents to prospects that investors are "factoring agents," or "factors," and that as their "client," Americash purchases accounts receivables on their behalf. Americash's Offering 13. Since at least December 2001, Americash has been offering and selling securities to the general public, raising approximately $1.2 million from more than 45 investors located throughout the country. Americash's offering consist of securities in the form of "accounts receivable purchase agreements," which guarantees investors exorbitant returns. 14. Americash claims it generates "a minimum of 150% return" on the money it has available to lend out to its customers. Americash claims to then pay investors a "fee," i.e., returns ranging from 24% to 36%, for allowing it to purchase accounts receivable on their behalf. Interest is paid monthly to investors during the term of the investment. However, investors are told they can choose to accrue their interest and compound their returns in an account with Americash for even higher returns. 15. The Americash investment has a term of 12 months, or longer if the investor chooses to renew the agreement. The company, however, promises to return an investor's principal at any time, without a penalty, if the investor cancels the agreement and provides 90 days written notice. Americash accepts investor funds without regard to the dollar amount of the investment. 16. Americash's securities are being offered and sold to the general public through Americash's own boiler room operation, and through a network of other boiler rooms and independent sales agents located throughout the country. Americash uses commercially purchased "lead lists" of potential investors and contacts them orally through "cold call" telephone solicitations, and through unsolicited e-mails. The company's e-mails encourage prospects to reply with their name and telephone number so that a representative of the company can contact the prospect on the telephone. 17. During sales calls, telemarketers use high pressure sales techniques to solicit funds from prospects by emphasizing, among other things, the investment's guaranteed high returns. Sales agents also direct potential investors to Americash's Internet website for more information regarding the investment opportunity. On the website, investors are told that this is a "limited time offer made on a first come basis." 18. If a prospective investor expresses interest in the offering, the sales agent sends the prospect a package of Americash's offering materials by either overnight mail or by facsimile. The telemarketer later calls the prospect in an attempt to close the deal. The sales techniques, such as the company's "limited time offer" representation are designed to create a sense of urgency in the investor. Once prospects are persuaded to invest, they must sign the necessary paperwork included in the offering materials, and return them, along with their funds, to Americash. 19. Americash, which does not require that its sales agents have securities licenses, pays its agents commissions on the investor's principal investment. In addition, no registration statement has been filed or is in effect with the Commission in connection with the securities offered by Americash. Americash's Offering Materials 20. Prospective investors receive offering materials describing the Americash investment opportunity. The offering materials being sent to prospects include an introductory letter to investors, two pages describing Americash's business, a two-page document entitled "Frequently Asked Questions," an "accounts receivable purchase agreement" and a one-page document listing business references. In addition to these documents, Americash's website devotes pages to further describing the investment opportunity and the payday advance industry. The website also includes, among other things, a "Frequently Asked Questions" section, a letter to prospective investors and a downloadable "accounts receivable purchase agreement." Material Misrepresentations and Omissions
21. Americash's offering materials and its website contain false and misleading statements concerning the use of investor funds and the safety of the investment. The introductory letter to prospective investors included in the offering materials represents that Americash is offering a "low risk, high yield investment opportunity." The letter explains the investment being offered by Americash as "the factoring of Accounts Receivable." The letter states that Americash is "offering a 36% guaranteed return" and that the return is 42% if the investors choose to have their returns compounded. Prospects are further told that they can have their entire principal returned to them at any time after giving a 90-day written notice. 22. As in the written materials sent to prospects, Americash's website represents that Americash will use investors funds to purchase accounts receivable on their behalf. Specifically, the website claims that Americash "use[s] [investor] money to lend out to [Americash] customers" and that "100% of factoring funds are lent out by contract." Notably, Americash's website explains that "it would be an act of fraud" to use investor funds otherwise. The company's website assures potential investors that Americash's investment opportunity involves "low risk" and is "extremely secure." The website represents that the investment is secured by the accounts receivable that are purportedly purchased by Americash on behalf of the investor. . 23. These representations are blatantly false and misleading. Bank records reveal that Americash is not using investor funds to purchase accounts receivable. Specifically, of the approximately $1.2 million raised to date, very little, if any, monies have been used to purchase accounts receivable as represented to investors. Instead, Americash is spending the majority of investor funds on salaries to its the principals, commissions to its sales agents and expenses to operate its boiler room operation. 24. Bank records also reveal that Americash is operating a Ponzi scheme. Bank records show that the Americash has no real source of revenue. Instead, records confirm that Americash is using new investor monies to pay interest to existing investors. Authority to Transact a Payday Advance Business 25. Americash's offering materials and its website mislead investors into believing that Americash is authorized to operate a payday advance business in the State of Florida. Specifically, the company's account receivable agreement states that Americash "is properly licensed and authorized to operate its business." This statement is false. In fact, as required by Florida law, Americash has never been registered, or applied to become registered, with the state to operate a payday advance business. Role of Benjamin 26. Benjamin is the mastermind behind the Americash offering and as the president of Americash, has knowingly or recklessly made, directed or authorized to be made, material misrepresentations and omissions to prospective and actual investors. 27. Upon information and belief, Benjamin is the author of, or reviewed and approved Americash's offering materials, or was severely reckless in not knowing, that the offering materials contained misrepresentations and omissions, as set forth above in paragraphs 20-25. 28. Upon information and belief, Benjamin directs or authorizes Americash's sales agents to disseminate Americash's materially false and misleading offering materials. 29. Benjamin has signatory authority over the company's bank accounts and controls the movement of the funds in its accounts. He signs all interest checks to investors and commission checks to Americash's sales agents. 30. Benjamin signs documents on Americash's behalf, including its office lease agreement, its agreement for services with third parties, and the company's application for an occupational license. Benjamin is also the managing member of World Business, a company that has received at least $140,000 in investor funds. Americash's Fraudulent Scheme is Ongoing 31. The Americash offering is ongoing. Bank records show that Americash has made sales to investors as recent as April 29, 2002. Americash is also currently soliciting investors through its Internet website. Further, upon information and belief, Americash's sales agents are presently offering and selling Americash's securities to the public. COUNT I SALE OF UNREGISTERED SECURITIES IN VIOLATION OF
32. The Commission repeats and realleges paragraphs 1 through 31 of this Complaint. 33. No registration statement was filed or in effect with the Commission pursuant to the Securities Act and no exemption from registration exists with respect to the securities and transactions described herein. 34. Since a date unknown but since at least December 2001 through the present, Defendants Americash.com, National Business and Benjamin, directly and indirectly, have been: (a) making use of the means or instruments of transportation or communication in interstate commerce or of the mails to sell securities as described herein, through the use or medium of a prospectus or otherwise; (b) carrying securities or causing such securities, as described herein, to be carried through the mails or in interstate commerce, by any means or instruments of transportation, for the purpose of sale or delivery after sale; and/or (c) making use of the means or instruments of transportation or communication in interstate commerce or of the mails to offer to sell or offer to buy through the use or medium of any prospectus or otherwise, as described herein, without a registration statement having been filed or being in effect with the Commission as to such securities. 35. By reason of the foregoing, Defendants Americash.com, National Business and Benjamin, directly and indirectly, have violated, and unless enjoined, will continue to violate Sections 5(a) and 5(c) of the Securities Act, 15 U.S.C. §§ 77e(a) and 77e(c). COUNT II FRAUD IN VIOLATION OF
36. The Commission repeats and realleges paragraphs 1 through 31 of the Complaint. 37. Since a date unknown but since at least December 2001 through the present, Defendants Americash.com, National Business and Benjamin directly and indirectly, by use of the means or instruments of transportation or communication in interstate commerce and by use of the mails, in the offer or sale of securities, as described herein, have been, knowingly, willfully or recklessly employing devices, schemes or artifices to defraud. 38. By reason of the foregoing, Defendants Americash.com, National Business and Benjamin, directly and indirectly, have violated and, unless enjoined, will continue to violate Section 17(a)(1) of the Securities Act, 15 U.S.C. § 77q(a)(1). COUNT III FRAUD IN VIOLATION OF SECTION 10(b)
39. The Commission repeats and realleges paragraphs 1 through 31 of its Complaint. 40. Since a date unknown but since at least December 2001 through the present, Defendants Americash.com, National Business and Benjamin, directly and indirectly, by use of the means and instrumentality of interstate commerce, and of the mails in connection with the purchase or sale of the securities, as described herein, have been, knowingly, willfully or recklessly: (a) employing devices, schemes or artifices to defraud; (b) making untrue statements of material facts and omitting to state material facts necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; and/or (c) engaging in acts, practices and courses of business which have operated, are now operating and will operate as a fraud upon the purchasers of such securities. 41. By reason of the foregoing, Defendants Americash.com, National Business and Benjamin, directly or indirectly, have violated and, unless enjoined, will continue to violate Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5, 17 C.F.R. § 240. 10b-5, thereunder. COUNT IV FRAUD IN VIOLATION OF
42. The Commission repeats and realleges paragraphs 1 through 31 of its Complaint. 43. Since a date unknown but since at least December 2001 through the present, Defendants Americash.com, National Business and Benjamin, directly and indirectly, by use of the means or instruments of transportation or communication in interstate commerce and by the use of the mails, in the offer or sale of securities, as described herein, have been: (a) obtaining money or property by means of untrue statements of material facts and omissions to state material facts necessary to make the statements made, in the light of the circumstances under which they were made, not misleading; and/or (b) engaging in transactions, practices and courses of business which are now operating and will operate as a fraud or deceit upon purchasers and prospective purchasers of such securities. 44. By reason of the foregoing, Defendants Americash.com, National Business and Benjamin, directly and indirectly, have violated and, unless enjoined, will continue to violate Sections 17(a)(2) and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77(q)(a)(2) and 77(q)(a)(3). RELIEF REQUESTED WHEREFORE, the Commission respectfully requests that the Court: I. Declaratory Relief Declare, determine and find that Defendants Americash.com, National Business and Benjamin committed the violations of the federal securities laws alleged herein. II. Temporary Restraining Order,
Issue a Temporary Restraining Order, a Preliminary Injunction and a Permanent Injunction, restraining and enjoining Defendants Americash.com, National Business and Benjamin, their officers, agents, servants, employees, attorneys, and all persons in active concert or participation with them, and each of them, from violating: (a) Sections 5(a) and 5(c) of the Securities Act, 15 U.S.C. §§ 77e(a) and 77e(c); (b) Section 17(a)(1) of the Securities Act, 15 U.S.C. § 77q(a); (c) Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5, 17 C.F.R. § 240.10b-5, thereunder; and (d) Sections 17(a)(2) and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77(q)(a)(2) and 77(q)(a)(3). III. Disgorgement Issue an Order requiring Defendants Americash.com, National Business and Benjamin, and Relief Defendant World Business to disgorge all ill-gotten profits or proceeds that they have received as a result of the acts and/or courses of conduct complained of herein, with prejudgment interest. IV. Penalties Issue an Order directing Defendants Americash.com, National Business and Benjamin to pay civil money penalties pursuant to Section 20(d) of the Securities Act, 15 U.S.C. § 77t(d), and Section 21(d) of the Exchange Act, 15 U.S.C. § 78(d)(3). V. Asset Freeze and Accounting Issue an Order temporarily freezing the assets of Defendants Americash.com, National Business and Benjamin, and Relief Defendant World Business until further Order of the Court, and requiring accountings by Defendants Americash.com, National Business and Benjamin, and Relief Defendant World Business. VI. Appointment of Receiver Issue an Order appointing a Receiver of the assets of Americash.com and National Business to marshal and safeguard all of said assets, and any other duties the Court deems appropriate, and to prepare a report to the Court and the Commission detailing the activities of Americash.com, National Business and Benjamin and the whereabouts of investor funds. VII. Records Preservation and Expedited Discovery Issue an Order requiring Defendants Americash.com, National Business and Benjamin to preserve any records related to the subject matter of this lawsuit that are in their custody, possession or subject to their control, and requiring Defendants Americash.com, National Business and Benjamin and Relief Defendant World Business to respond to discovery on an expedited basis. VIII. Further Relief Grant such other and further relief as may be necessary and appropriate. IX. Retention of Jurisdiction Further, the Commission respectfully requests that the Court retain jurisdiction over this action in order to implement and carry out the terms of all orders and decreesthat may hereby be entered, or to entertain any suitable application or motion by the Commission for additional relief within the jurisdiction of this Court. Respectfully submitted, May ____, 2002 By:__________________________
Chedly C. Dumornay
Jeffrey L. Cox
Attorneys for Plaintiff
http://www.sec.gov/litigation/complaints/complr17526b.htm
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