The so-called “prime bank” scheme, a style of Ponzi scheme, used proceeds from new investors to pay off old ones and allegedly operated since at least 2004, the SEC said in the complaint.
Alexander, who also went by the name Linda and now lives in Carlsbad, Calif., allegedly told investors to ignore the old saw that something too good to be true probably is, calling it “”A lie that came from the pit of hell.”
The suit claims Alexander told investors: “Put your money in the Trust and your trust in God.”
The SEC said Alexander and McClintock told investors they were making loans to “the Trust,” and could expect 38 percent annual returns if they followed secrecy rules.
The purported investment organization owned European banks and was controlled by wealthy Europeans, and only friends and family members of Trust members could know about it.
The SEC said McClintock and Alexander were friends for many years, and he recruited Alexander as an investor in the Trust and ultimately as a director.