Preliminary Injunction Ordered Against Investment Advisor for Elder Fraud

On June, 3, 2020, the U.S. Securities and Exchange Commission (“SEC”) obtained a preliminary injunction against investment adviser Paul Horton Smith, Sr. and related entities. The SEC alleges Smith and his entities engaged in a Ponzi scheme targeting senior citizens.

The SEC’s complaint refers to three entities associated with Smith: Northstar Communications, LLC, eGate, LLC, and Planning Services, Inc. Through these entities, the complaint alleges that Smith targeted seniors, guaranteeing investors annual interest payments in so called “private annuity contracts.” Smith did not in fact invest the money as promised, the SEC explained, and instead used the money to pay investors in a Ponzi-like fashion. The SEC also alleges that Smith held himself out to be a trusted fiduciary.

The case is Securities and Exchange Commission v. Paul Horton Smith, Sr., et al., Central District of California, No. ED CV 20-1056 PA (SHKx).


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Cody Berne
Cody Berne is an attorney at Stoll Berne in Portland. Cody’s practice focuses on representing investors who lost money because of fraud and other misconduct, class actions, and business litigation. He is a member of the Public Investors Advocate Bar Association and the Oregon Trial Lawyers Association. Cody previously worked as a deputy district attorney at the Multnomah County District Attorney’s Office where he tried over 30 trials to verdict. Before that, Cody represented individuals and businesses in cases involving investment fraud and a wide range of business disputes at a large Portland firm. He received the Haglund Award in 2016 from the Multnomah Bar Association and was named in The Best Lawyers in America in 2020. During law school, Cody interned for U.S. District Court Judge Kimberly Mueller and U.S. Magistrate Judge Carolyn Delaney. Elected to Order of the Coif, he received the Clinical Legal Education Association Award and a Witkin Award. Cody also represented clients as a law student at the Civil Rights Clinic and Prison Law Clinic and earned a Public Service Certificate. Before law school, Cody worked as a police officer with the Portland Police Bureau and as a wildland firefighter.

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The information contained in this blog does not constitute legal advice, and does not create an attorney-client relationship. We make no claims, promises or guarantees about the accuracy, completeness, or adequacy of the information contained in or linked to this blog.