The US Securities and Exchange Commission has charged CMI Capital LLC and its manager, Michael D. Williams, for an alleged fraudulent scheme that raised approximately $860,000 from at least 18 investors, including active and retired law enforcement personnel.
Details of the Alleged Investment Scheme
According to the regulatory complaint, the activity took place between October 2023 and August 2024. The defendants targeted individuals in South Florida, many of whom trusted Williams because of his employment with a third-party administrator for police and firefighter pension plans.
The SEC alleges that Williams made false statements to convince clients to place money into two funds under his control. Prospective investors were reportedly told that one fund maintained a portfolio value over $5 million and generated returns exceeding 140 percent. The regulator stated that cropped screenshots of graphics showing exaggerated trading profits were distributed to trick investors.
Misappropriation and Proposed Settlement Terms
The complaint asserts that Williams diverted roughly $384,000 of client funds to cover personal expenses, including credit card debts, vacations, and a sports car. Williams started repaying selected investors in August 2024 and has returned over $375,000 so far.
Filed in the US District Court for the Southern District of Florida, the action charges Williams and CMI Capital, also trading as Check Mate Investments, with violating antifraud and registration provisions of the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Advisers Act of 1940.
Without admitting or denying the allegations, the defendants agreed to a bifurcated settlement subject to court approval. The proposed terms include permanent injunctions against future violations of federal securities laws, restrictions preventing Williams from trading securities outside personal accounts, court-determined disgorgement and civil penalties, and a forthcoming associational bar against Williams.
