FOR IMMEDIATE RELEASE
Wednesday, April 21, 2004
Contact: Terri Durdaller, (573) 522-9756
Blunt Halts Investment Scheme Promoted by Lee's Summit and Lake Ozark Men
JEFFERSON CITY - Secretary of State Matt Blunt issued a cease and desist order against The RWS Group, Inc., RWS Investments, and Ronald Shepard all of Lee's Summit and Jerry McGuire of Lake Ozark, for selling unregistered securities. The RWS Group claimed to be a non-profit organization specializing in income tax planning, wills, trust and powers of attorney, mortgages, insurance investments, annuities and college funding.
Shepard and McGuire solicited investments through various college funding seminars and mailing packets. Both men told investors that RWS paid 15 percent annually and the investment was a low-risk venture and "as safe as money in the bank." The example Shepard gave to an investor to explain how RWS worked was the organization would purchase T-Shirts for $.50 each and sell them to a retail store for $5 each.
On Aug. 3, 2003 a Kansas resident invested $50,000 in RWS thinking it was a liquid, insured long-term investment. On Nov. 26, 2003 Shepard gave the investor $51,875, which represented the investor's principle plus 15 percent interest for three months. Shepard said RWS was having registration problems with the State of Missouri and he was reimbursing all RWS investors. On Feb. 16, 2004 Shepard informed the investor that the registration problems were no longer an issue and they could reinvest. The Kansas resident invested $31,000 that same day.
On Aug. 19, 2003 McGuire solicited a Missouri resident with a mailed letter that highlighted the good fortunes RWS had to offer investors. The letter listed various Christian organizations that RWS members were actively involved in, such as Knights of Columbus and Christian Businessmen's Association. Between Sept. 4 and 16, 2003 the Missouri resident invested $20,000. On Nov. 22, 2003 the investor’s principle plus interest was returned to the investor and Shepard explained it was because of a disagreement between his attorneys and the secretary of state's attorney's regarding RWS. Shepard and McGuire told the investor that after the matter was resolved the investor could reinvest.
The Missouri Securities Division's investigation revealed that Shepard's insurance license was revoked in 1994 for fraudulent activities, Shepard also filed for bankruptcy in 1999. The Division also revealed that McGuire pleaded guilty to making false statements to the Social Security Administration in 2001 and was placed on five years probation. None of this information was disclosed to potential investors, as required by Missouri law.
Upon review of RWS and Shepard's bank accounts the Division also learned Shepard had raised approximately $1.4 million from unidentified investors and there was no indication the investors funds were invested into a profitable enterprise.
Shepard's wife Mary, was listed as an officer of RWS and was also named in the order.
Blunt, Missouri's top securities enforcer is given the authority by state law to issue a cease and desist order as an administrative action to stop sales of fraudulent investments and to protect and alert Missourians.
"There is an inherent amount of risk associated with any financial investment," Blunt said. "Investors should always take the time to research any investment offer to ensure that it is valid and that it at least has the potential of producing the promised returns.
"It is equally important to check the credentials of the person offering the investment to make sure they are registered with my office. Missouri investors can check on both by contacting our Investor Hotline at 1-800-721-7996."
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