SEC shuts down Achieve Community for Pyramiding

Julie Lutz SEC

 

The Securities and Exchange Commission has announced fraud charges and an emergency asset freeze against two operators of a Colorado-based pyramid and Ponzi scheme that promises investors extraordinary returns of 700 percent through a purported triple algorithm and 3-D matrix.

In the complaint the SEC alleges that Kristine L. Johnson of Aurora, Colo., and Troy A. Barnes of Riverview, Mich., have raised more than $3.8 million since April 2014 from investors they enticed into buying positions in their company Work With Troy Barnes Inc., which is doing business as The Achieve Community. In Internet videos and other web promotions, investors were pitched you and anyone you know can make as much money as you want by purchasing positions that cost $50 each, and as they progress through the matrix they would receive a $400 payout on each position within three to six months. Barnes claimed to have hired a seasoned programmer to perfect the triple algorithm investment formula supposedly generating the extraordinary returns.

The SEC alleges that while Johnson and Barnes explicitly claimed their program was not a pyramid scheme, their company has no legitimate business operations and they are merely paying purported investment returns to earlier investors as they receive funds from new investors. Meanwhile, Johnson and Barnes have been making cash withdrawals of investor funds for such personal uses as buying a new car and paying credit card bills.

Johnson and Barnes allegedly claim to be operating a successful investment program when in fact they are taking funds from new investors to pay phony profits to earlier investors, said Julie Lutz, Director of the SEC's Denver Regional Office.

The SEC's complaint alleges that Work With Troy Barnes, Johnson, and Barnes violated Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. The SEC's complaint names Achieve International LLC as a relief defendant for the purpose of recovering ill-gotten gains from the scheme in its accounts. The Honorable Robert E. Blackburn, U.S. District Judge for the District of Colorado, granted a temporary restraining order that in part freezes the assets of Johnson, Barnes, and their company.

 

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