A veteran airline pilot is facing criminal and civil charges that he scammed real estate investors out of more than $1 million, including two fellow pilots whom he allegedly targeted because of their large 401(k) accounts.

Jerry Lee Farish, a resident of Tarrant County, Texas, told investors their money would be used as a second lien in a high-end home-building project in the state, but he later used the funds for personal uses such as Disney cruises, entertainment and retail expenses and a retainer for a criminal defense lawyer for one of his sons, according to an SEC complaint filed in U.S. District Court on Thursday. The bank account he used to spend the client money now sits empty and investors have received no returns on their money, the complaint added.

"In fact, Farish allegedly sold the same investment on three different occasions and purported to grant three separate investors the same 'second lien,'" the SEC said in a press release.

Farish is also facing a related criminal wire fraud charge filed by the U.S. Attorney's Office for the Northern District of Texas in January, with his trial set to begin in October, the SEC said in its release.

Farish, who has more than 30 years’ experience as a commercial pilot for a North Texas-based airline, specifically targeted fellow airline pilots with large 401(k) accounts, the SEC said in its complaint.

The scheme was conducted in 2016 and 2017 through New Summit Homes, a real estate development company in Tarrant County whose official executive officers were Farish's three sons, but which was actually run by Jerry Farish himself, who was the firm's de facto owner and CEO, the SEC said.

Farish started New Summit Homes in 2014 and for the first two years of its existence ran it as a legitimate operation for its first group of investors, building and selling homes for profit, the SEC said. "Farish, however, used New Summit as a vehicle to defraud investors and misappropriate funds from investors in the second group who invested in New Summit projects for a profit," the SEC complaint said.

In urging his fellow pilots to provide money for the scheme, Farish extolled "the benefits of creating a self-directed IRA to invest in New Summit projects," the complaint said.

In his marketing, which included written brochures, Farish told his company's second group of investors that they would be providing a second lien for a housing development called Little Bluestem in Westlake, Texas, the complaint said.

One of the brochures said investors were being given the opportunity to bridge "the gap between the amount the bank would lend and the full amount required for construction of a home in exchange for a predetermined return when the home was ultimately sold," the complaint said.

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