SEC alleges Ponzi-like payments from Morgan companies

May 24, 2019

Another federal government agency has concerns about the financial dealings of Rochester area developer Robert Morgan.

Credit Robert Morgan Communities

On Wednesday, Morgan and three others were named in a 114-count indictment alleging mortgage fraud in New York and several other states.

Also this week, the U.S. Securities and Exchange Commission filed an emergency action accusing Morgan and two of his companies with fraud for allegedly siphoning and misusing investor funds.

The SEC says that Morgan financed his development projects in different ways, including through the sales of securities to more than 200 retail investors, many of whom invested through their retirement accounts.

The commission alleges that Morgan and his companies diverted investor funds to facilitate what the SEC calls Ponzi-scheme like payments to earlier investors.

That federal agency says it is acting to protect current and potential future victims of what it calls an elaborate scheme.

The SEC is requesting an order to freeze Morgan’s assets and also seeks civil penalties.