FOR IMMEDIATE RELEASE
Feb 14 2008
Contact: Ryan Hobart;Mindy Mazur, (573) 526-4734;(573) 522-9756
Carnahan Slams the Door on New Home Construction Scam
Investor money for new home construction used for personal expenses
The action was taken against Randy Allen Rippee and his son, Frankee Lee Allen Rippee, both of Springfield, Mo., as well as their companies RCH Investment Group, Inc., RCH Investment Corp., and Rippee Custom Homes, LLC.
Investigations led by Carnahan's Securities Division revealed that the Rippees solicited investments for new home construction near Branson, Mo., by promising investors a "guaranteed" return. Beginning in late 2004, the pair used a website to persuade people to invest more than $1.2 million in their companies. But financial records show that instead of putting this money towards new home construction, the Rippees instead used investor money to make payments to automobile dealerships, a baseball team, a resort, a dentist and a funeral home. They even paid over $300,000 to themselves in payroll and cash expenses.
To date, only $10,000 has been returned to investors and all of the homes are currently in foreclosure or have been foreclosed on.
"This case is an example of why investors should be on the lookout for those who claim to have investments that are 'guaranteed' or are a 'sure thing'," said Carnahan. "Always check out claims that sound too good to be true because they probably are. One call to the investor protection hotline at my office can help stop a scam before it starts."
The Rippees and their companies are prohibited from offering or selling any securities until they are properly registered with the Securities Division. Further actions could result in tens of thousands of dollars in penalties and costs for the Rippees and their companies. They have 30 days to request a hearing. A copy of the full order is available at: http://www.sos.mo.gov/securities/orders/AP-08-01.pdf.
For more information regarding investments and fraud protection, visit www.MissouriSafeSavings.com or call the toll free investor protection hotline at 1-800-721-7996.