MORRISON TAKES LEGAL ACTION TO SHUT DOWN $2 MILLION ALLEGED INVESTMENT SCAM OPERATING IN MONTANA
Twenty-two Montanans invest more than $2 million in sports marketing scheme
State Auditor John Morrison has issued a Notice of Proposed Agency Action and Cease and Desist Order against Global Sports Marketing Corporation, also known as Global Broadcast Digital Network, the firm’s CEO, Wayne Butler of Norristown, Pennsylvania and Chairman, Craig Steen, of Bozeman. The action alleges Global Sports Marketing, Butler and Steen defrauded at least 22 individuals who invested more than $2,067,000 in an investment opportunity.
The Auditor’s Office alleges that during the period between 2003 - 2005, Butler and Steen solicited and sold Montana investors an investment opportunity which they claimed would double the investors’ money or better in the first year. An offering document used to solicit investors was entitled “Join the Millionaire Club! Turn 37K into $100,000 a month.” To make these outstanding returns, Butler and Steen told investors that Global Sports Marketing would purchase large plasma screen televisions using investors’ money, place the plasma screens in high traffic areas at sports venues and other locations throughout the country, sell advertising for the screens at $4 per minute and then return $2 per minute from the ads back to investors. While Global Sports Marketing raised enough money from investors to purchase at least 147 plasma screen televisions, it does not appear any were actually purchased nor was any advertising sold.
“This alleged scheme has taken more than $2 million out of the pockets of Montanans while failing to provide the promised investment returns,” said Morrison. “No one can absolutely guarantee a profit from any investment. An offering claiming to double your money in a short period of time should raise a red flag in your mind that the offer could be a scam.”
In addition, the Auditor’s Office alleges that through numerous letters, Butler made false promises that misled investors about the investment’s potential. For example, the Auditor’s action alleges Butler told investors Global had secured approximately 40 major building locations to install the plasma screens. However, Global had not secured these locations nor had it purchased any plasma screens. Investors were told that by purchasing two screens, at a total cost of $37,000, they could expect to receive approximately $45,320 per month in advertising revenue.
To date, no investor has received a return of principal and most investors have received minimal or no return on their investment. Individual investments in Global range from a few thousand to several hundred thousand dollars. One investor, who was formerly retired, claims he has had to go back to work as a result of this investment.
The Auditor’s office is seeking restitution, including 10% interest annually, for each of the investors, as well as a fine of $5,000 for each alleged violation of the Montana Securities Act.
Morrison said that Montanans should look for specific warning signs of a fraudulent investment scheme when presented with an investment opportunity. Red flags include: 1) “Guaranteed” double-digit returns, 2) “Risk-free” investments and 3) Salespeople emphasizing the exclusivity of an investment opportunity and the importance of keeping the investment a secret from your friends and family.
Montanans who may have been solicited by or may have invested in Global Sports Marketing Corp. or Global Broadcast Digital Network are asked to immediately notify the State Auditor’s Office by calling toll-free at 1-800-332-6148 or in Helena at 444-2040.