In a complaint filed in the December 10th, 2008, lawyers for two plaintiffs alleged seven counts of fraud and misrepresentation. The counts included allegations of violations of securities laws. According to the complaint, Greg Vennes acted as a go-between for his brother's hedge fund Metro Gem and two wealthy investors.The complaint alleges Greg received a commission for the transaction. Greg Vennes was not a registered securities broker. The complaint sought damages in excess of $5,500,000.
In a separate document, Greg Vennes, through his attorney admitted he received payment from Metro Gem, but denied having an arrangement. Vennes also admitted not having a license to sell securities.
In a January 7, 2009 affidavit seeking a protective order and a stay of discovery, Greg Vennes told his side of the story beginning in 2000 when he moved back to Minnesota with his family. Greg had worked in the U.S. Postal Service for 19 years prior to his arrival on the swanky shores of Lake Minnetonka. Greg befriended two elderly neighbors and they swapped investment tips. Greg told the old gents that he had a company called Grace Consulting Services Inc. (remember that name). Greg also said his company invested in notes from a company owned by brother Frank, Metro Gem Inc. Frank said his investment in Metro Gem was "proving successful", however Greg claimed he did not speak for his brother and had no idea how Metro Gem operated. The Grace Consulting investments were reinvested at a higher rate in Metro Gem.
According to Greg's affidavit, in 2003, the first distinguished representative of the Minnetonka gentry Greg had befriended invested in Metro Gem and saw his investment grow (on paper) to $3.5 million, earning 12% annually. In 2003, the other old gent plopped down $2 million for Grace Consulting Inc. notes. Later in 2007, the second fellow transferred his investment from Grace Consulting to Metro Gem. According to Greg, he had a quarrel with his brother in February, 2008 over the care of their elderly parents and Greg took Grace Consulting's money out of Metro Gem. About six months later, the FBI raided brother Frank's homes along with Tom Petters' homes and business. The two elderly gents saw their investments swirling down the Petters Ponzi crapper along with billions of other investors' dollars.
One of the old gents died in May, 2009 (according to his Strib obituary, he " suffered from dementia for the past few years") and The lawsuit was settled by the end of 2009. The other fellow was listed among the creditors seeking relief in Frank's Work-Out Plan. No trial, no verdict, end of story.
But… here's something interesting - remember that company Grace Consulting Services Inc.? There's another company called Grace Consulting of Southeast Inc. registered in Florida. Incidentally, Greg's wife Stephanie donated $4,200 to Michele Bachmann in 2005 and she was just a secretary - how freaking' successful does a company have to be to have its secretaries throwing thousands of dollars at politicians!
Anyways, back in 2008, before Grace Consulting of Southeast Inc. changed its address, the company's registered address was 752 S.W. Squire Johns Lane Palm City, FL 34990.
Google that address and you get all kinds of links to stuff having to do with a guy called Jason Bo-Alan Beckman. Who he?
Strib:
Jason Bo-Alan Beckman, a brash Wayzata money manager who has claimed to be among the top financial advisers in the nation, was civilly charged Monday with participating in an elaborate $194 million investment fraud.
Beckman, 41, was an associate of Trevor Cook, an Apple Valley man who pleaded guilty last year to bilking about 1,000 investors in the $194 million Ponzi scheme. Cook, 38, was sentenced in August to 25 years in prison.
Lawyers for the Securities and Exchange Commission said Beckman raised at least $47.3 million from 143 individuals, of which only $8.2 million was returned to investors.
The government complaint says Beckman and his wife personally received $7.8 million from the illegal operation and used the funds to pay for "million dollar homes, luxury cars, foreign travel, country club expenses, a suite at professional hockey games and other trappings of a high-end lifestyle."
Holy cow, what an awesome coincidence! The house had two owners… BOTH linked to Ponzi schemes in Minnesota!
For more fun, read Patrick Pretty's 3/26/11 article on the property where the following pic of the Ponzi palazzo is from:
