Litigation Release No. 25133 / July 2, 2021
Securities and Exchange Commission v. Roger Nils-Jonas Karlsson, 20-cv-04615 (E.D.N.Y. filed September 29, 2020)
On June 30, 2021, the U.S. District Court for the Eastern District of New York entered a consent judgment against Roger Nils-Jonas Karlsson, a Swedish national, whom the Securities and Exchange Commission had charged with conducting a multi-million dollar online offering fraud that victimized thousands of retail investors worldwide.
The SEC’s complaint, filed on September 29, 2020, alleged that from November 2012 to June 2019, Karlsson, through his entity, Eastern Metal Securities, raised millions from over 2,000 retail investors located in nearly every state in the United States, as well as in over 45 countries around the world. From December 2017 through June 2019 alone, investors allegedly sent more than $3.5 million to Eastern Metal Securities. According to the complaint, Karlsson solicited the investors, through the Eastern Metal Securities website, by falsely claiming, among other things, that the investment – a “Pre Funded Reversed Pension Plan” – was run by award-winning economists and had no risk of loss. The SEC alleged that Karlsson misappropriated at least $1.5 million of investor funds to purchase real estate in Thailand and to pay other personal expenses.
The judgment permanently enjoins Karlsson from violating the registration provisions of Section 5 of the Securities Act of 1933 and the antifraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The judgment further orders him to pay disgorgement, prejudgment interest, and a civil penalty in an amount to be determined by the court upon a motion of the SEC.
The SEC’s litigation is being conducted by Karen M. Lee, John C. Lehmann, Jordan Baker, Richard Hong, and Thomas P. Smith, Jr., of the SEC’s New York Regional Office, and is being supervised by Sanjay Wadhwa. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Northern District of California and the Internal Revenue Service.