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The Idaho Department of Finance is seeking return of $3.7 million in investor money from Sheila Lee Jones, a Meridian real estate fund manager and owner of Vitruvian Investment Group.
Jones allegedly raised $3.7 million from about 40 investors and offered returns of 8 to 10.5 percent, Department of finance officials said.
In a complaint filed in Ada County District Court, the Department of Finance alleged that Jones:
Æ Failed to advise investors that the only way the fund could be successful would be to continue to bring new investor money into the fund.
Æ Misrepresented to investors that their investment proceeds would be secured by real estate loans.
Æ Misrepresented to investors that the fund would be reconciled by a CPA on a monthly basis.
Æ Misrepresented to investors that a CPA would perform an annual audit of the fund.
Æ Failed to advise investors that some investor money would be used for Jones’ personal benefit.
Jones could not be reached for comment.
The lawsuit seeks a court order prohibiting Jones from further violations of the Idaho Securities Act and the Idaho Financial Fraud Prevention Act and seeks to limit Jones's future business activities.
Vitruvian Investment Group filed for Chapter 7 bankruptcy protection in November 2008, the department said.
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