WCM777 Halts Operations After Fraud Investigation by the Massuchetts Securities Division
WCM777 Inc., a company selling cloud services, together with World Capital Market, Inc., a global merchant bank with offices in California, both operated by its president Ming Xu, entered into a Consent Order dated November 14, 2013 with the Massachusetts Securities Division in relation to products and services it offered to approximately 160 residents of Massachusetts, most of which came from the Brazilian community.
On September 2013, the Massachusetts Security Division began investigating World Capital Market and WCM777 for failing to register under the Act. The Division found that WCM777 apart from selling cloud services were also bundling packages that offered various bonuses, including profit sharing and commissions for referrals. In effect purchasers of WCM777 became agents of WCM777 under a social network marketing program.
The Division found that WCM777 marketed this packages as offering returns of 90% over a 100-day cycles. As a result most purchaser opted for the most expensive package at $1,999 which offered the biggest payout. Most of the promised bonus and compensation by WCM777 to its purchaser remain outstanding, according to the investigation.
These packages are believed to fall under the definition of securities under the Act according to the Division. As such WCM777 was required to register with the Division but failed to do so.
WCM777 and World Capital Market did not deny, or admit the allegations found in the consent order. As part of the settlement however, WCM777 shall cease the distribution of the packages and shall reimburse all affected Massachusetts resident.
The Peiffer Rosca securities attorneys often represent investors who lose money as a result of Ponzi schemes, investment fraud, or stockbroker misconduct. They take most cases of this type on a contingency fee basis and advance the case costs, and only get paid for their fees and costs out of money they recover for their clients.
Investors who believe they lost money as a result of investment fraud or misconduct may contact the securities lawyers at Peiffer Rosca, Jason Kane or Joe Peiffer, for a free, no obligation evaluation of their recovery options, at (585) 310-5140.