SEC Obtains Court Order to Stop Investment Adviser’s Alleged Ongoing Offering Fraud
Washington D.C., Aug. 13, 2021 —
The Securities and Exchange Commission today announced the filing of an emergency action against Martin A. Ruiz of New York, and two entities he controls, Carter Bain Wealth Management, LLC (Carter Bain) and RAM Fund, LP (RAM). Shortly after filing the complaint, the SEC obtained a temporary restraining order and asset freeze against Ruiz, Carter Bain, and RAM to stop an allegedly ongoing fraudulent securities offering through which Ruiz and his entities allegedly misappropriated millions of dollars from investors.
According to the SEC’s complaint, filed in the United States District Court for the Southern District of New York on Aug. 6, 2021, and unsealed Aug. 12, 2021, Ruiz induced at least 56 investors, many of whom are elderly clients of Ruiz’s New Mexico-based investment adviser Carter Bain, to invest at least $10.6 million in RAM by falsely claiming that their funds would be used to acquire real estate and to make commercial loans. According to the complaint, however, Ruiz misappropriated the vast majority of the investors’ funds to support his lavish lifestyle by, among other things, paying for his residences in Manhattan and Santa Fe, covering millions of dollars in credit cards bills, and making student loan payments. The complaint also alleges that Ruiz hid the fraud from investors by making Ponzi-like payments, and providing investors with false valuations concerning their RAM investments.
“As we allege in the complaint, Ruiz recommended that his advisory clients invest in an entity based on false claims, and then stole their money,” said Kurt L. Gottschall, Director of the SEC’s Denver Regional Office. “Clients should be able to trust that their investment adviser will invest their assets as promised.”
The complaint charges Ruiz, Carter Bain, and RAM with violating the antifraud provisions of the federal securities laws. The SEC obtained emergency relief, including a temporary restraining order and asset freeze, against Ruiz, Carter Bain, and RAM on Aug. 9, 2021.The SEC seeks additional remedies in the ongoing litigation, including permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, and civil penalties, against Ruiz, Carter Bain, RAM, and other entities Ruiz owns and controls.
The SEC’s investigation was conducted by J. Lee Robinson, Kenneth Stalzer, and Donna B. Walker and supervised by Ian S. Karpel and Jason J. Burt. The litigation will be led by Stephen C. McKenna and Kenneth Stalzer, and supervised by Gregory A. Kasper.