Securities Fraud Lawyer Blog
RALEIGH – A former Harnett County man accused of luring investors into a fraudulent daytrading scheme pleaded guilty July 20 in US District Court in Raleigh, following an investigation by the North Carolina Secretary of State’s Securities Division. Ronnie D. Rainey, 43, pleaded guilty to federal mail fraud. He is scheduled to be sentenced on November 1. The Secretary of State’s Office conducted the investigation, and the mail fraud charge was brought by the US Attorney’s Office.
Rainey – a day trader and former Harnett County school teacher – solicited investors in North Carolina and other states to invest their money with him from 2003 until 2005 through four LLC’s that he created, Par 5 Investors, LLC; Birdie Investors, LLC; Eagle Investors, LLC; and Double Eagle Investors, LLC. Rainey was never registered to sell securities in North Carolina. He created multiple accounts with E*Trade and Ameritrade and drew in investors with claims that they would get monthly returns of 10-percent if they invested with him. Rainey is accused of defrauding 60 investors – including 12 North Carolina investors – of nearly $3 Million between 2003 and 2005.
When Rainey’s investments began losing money, he manufactured false monthly and quarterly statements for investors indicating their investments were turning a profit. Investigators allege Rainey shuffled funds between accounts and converted much of investors’ money to his personal use.
Rainey relocated from Harnett County to Las Vegas in late 2003, where he continued to solicit investors for his day trading scheme. He relocated to Oklahoma in 2007.
Secretary of State Elaine F. Marshall appealed to potential investors to always use caution when considering an investment. “Mr. Rainey lured victims with promises of high returns. But please remember if it sounds too good to be true, it usually is. Mr. Rainey also was never registered with our Securities Division to sell securities in North Carolina. That is why it is so very important that anyone considering an investment first call our Securities Division at 1-800-688-4507 to make sure that the person pitching the investment, and the investment itself, are properly registered with us.”