States Charge Operator with “Unregistered CD” Scam That Grossed $47 Million
By Tracey Longo
Four states have charged an unregistered broker with a $47 million scam involving the sale of “CD alternative” investments from 32 real estate development corporations he owned.
The alleged scam artist, Glenn C. Mueller, operated his nationwide operation out of Illinois for more than 40 years and has taken in millions from unsuspecting investors across the country, authorities said.
Mueller “has taken in at least $47 million of investor funds through unregistered promissory notes nationwide and additional funds through unregistered limited partnerships,” the Massachusetts Securities Division said in its charging documents today.
Massachusetts Secretary of the Commonwealth William F. Galvin said he brought charges against Mueller “over the sale of unregistered securities in real estate ventures to Massachusetts investors, totaling nearly $1 million.”
Similar complaints were also brought in New Hampshire, Illinois and New Jersey today.
“This case is a good example of the importance of checking that any investments you are considering are being sold by registered dealers or agents,” Galvin said.
Mueller and Northridge Holdings Ltd. have, for over 40 years, built up “a monumental and byzantine investment empire consisting of at least 32 interwoven real estate development corporations and limited partnerships,” the Massachusetts complaint said.
Mueller owns 100 percent of the stocks in Northridge, the lead property management company operating out of Illinois.
According to the complaint, the promissory notes, referred to by these companies as “CD Alternatives,” were not registered securities, nor were they insured by the Federal Deposit Insurance Corporation.