SEC Charges Minnesota Based Company and Founder in Alleged Fraudulent Securities Offering

On September 11, 2023, the Securities and Exchange Commission (SEC) filed a complaint in federal court in Minnesota, alleging fraudulent activities by Robyn A. Bowman and her company, Phoenix Asset Group, LLC, involving a deceptive offering.

According to the SEC’s complaint, Bowman and Phoenix raised a minimum of $2.7 million from approximately 20 investors. They claimed that Phoenix would utilize the invested funds to acquire distressed debt portfolios, which would then be placed with third-party agencies for debt collection. Investors were promised annual returns of up to 15%, along with a share of the profits generated from the debt collection.

To attract investors, Bowman and Phoenix made false statements regarding the safety of these investments. They assured investors that their funds would be used exclusively for business purposes. In reality, Bowman mixed her personal finances with those of Phoenix and used Phoenix’s bank accounts for her personal expenses. Furthermore, the complaint alleges that funds from new investors were diverted to repay earlier investors.

The SEC’s complaint also contends that Bowman and Phoenix provided false information to investors, including claims that the debt portfolios would be insured and audited, that they had never faced consumer protection lawsuits, and that Bowman had a solid financial background. However, Bowman had previously filed for bankruptcy twice, a fact that was concealed from investors.

By April 2020, Phoenix ceased making payments to investors, and Bowman attributed the halted payments to the COVID-19 pandemic and one of the collection agencies she had engaged. Despite failing to make payments to earlier investors, Bowman continued to solicit new investments and falsely informed investors that Phoenix was on the verge of receiving an $8 million cash infusion from an Italian hedge fund.