Seong Yeol Lee and Ameritrust Corporation, et al.

U.S SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 25821 / September 6, 2023

Securities and Exchange Commission v. Seong Yeol Lee and Ameritrust Corporation, et al., No. 3:23-cv-00125 (D. Conn. filed Feb. 1, 2023)

SEC Obtains Judgments Totaling More Than $20 Million Against Microcap Company and Related Entity in Fraud Action

The Securities and Exchange Commission announced that, on September 5, 2023, the U.S. District Court for the District of Connecticut entered judgments against two entities, Ameritrust Corporation and Beespoke Capital, Inc., that, among other things, order the parties to pay over $20 million in the SEC's pending fraud case, filed in February 2023.

The SEC's action alleges that Ameritrust and its CEO, Seong Yeol Lee, misled and stole funds from investors in the United States and the Republic of Korea between at least 2019 and 2023. The SEC's complaint alleges that, through a network of recruiters acting at his direction, Lee solicited more than $20 million from investors primarily in the Republic of Korea, who sent money to corporate and personal bank accounts that Lee controlled in the United States to buy shares of Ameritrust, a publicly traded company in the United States. Lee, either directly or through his recruiters, allegedly told investors that their money would be used to buy shares in a U.S.-based company that would be listed on a national stock exchange, guaranteeing profits for anyone holding the shares. In reality, the SEC's complaint alleges, Ameritrust has no real operations and did not apply for any exchange listing. According to the SEC's complaint, Lee misappropriated investor funds by transferring money from corporate bank accounts to his personal bank accounts and to three of his adult children. Lee also allegedly received or held investor funds in accounts of Beespoke Capital, an entity affiliated with Lee and Ameritrust.

The judgments were entered against Ameritrust and Beespoke by default. The judgment against Ameritrust prohibits it from violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10(b)-5 thereunder, and orders it to pay disgorgement of $11,967,705, plus prejudgment interest of $1,602,391, and a civil penalty of $2,232,280. The judgment against Beespoke Capital, a relief defendant in the SEC's action, orders it to disgorge ill-gotten gains of $4,871,097, plus prejudgment interest of $325,421. The court previously entered a temporary order freezing assets of Lee, which remains in effect.

The SEC's case remains pending against Lee and three of his adult children, who are named as relief defendants in the SEC's action.