Texas insurance agent to pay $700,000 for his part in $4.6 million investment ‘scheme’
December 8, 2015 by IFAWebnews Staff
A Texas insurance agent has agreed to pay more than $700,000 in civil penalties from illegally obtained profits in connection with a multimillion-dollar scheme in which he reportedly defrauded elderly investors.
According to the U.S. Securities and Exchange Commission, Bobby M. Collins, 56, an insurance agent who lives in Witchita Falls, Texas, and operates Collins Insurance in Iowa Park, Texas, is accused of raising $4.6 million from Texas and Oklahoma investors in a fraud “scheme.”
Collins is licensed in Texas and Oklahoma.
The commission filed a complaint in the U.S. District Court of Texas’ Northern District against Collins
The complaint states Collins lured in elderly individuals and persuaded them to invest their savings in “high-yield, unsecured notes” with promised returns ranging from one to two years. Collins reportedly promised the 36 investors he would use their capital to grow his insurance business — instead he used most of the money to make mortgage and luxury car payments; for retail shopping; and payments to earlier investors.
Less than 2 percent of investors’ money was used for its promised purpose, the complaint says.
In a settlement agreement, Collins consented to an injunction for three federal violations of the Securities Act and Exchange Act. He agreed to pay $573,234 in disgorgement and prejudice interest and a $160,000 civil penalty.
The agreement is subject to approval by the district court.
