Southern Nevadans Named in Secretary of State Cease and Desist Order Indicted on Securities Fraud

Securities Division ordered unlicensed agents to stop sale of unregistered securities in 2011

Post Date:04/10/2014

Contact: Catherine Lu, Public Information Officer 
             (702) 486-6982 / 334-7953 

(Carson City, NV; April 10, 2014) – The Clark County grand jury indicted two individuals whom Secretary of State Ross Miller’s Securities Division issued a cease and desist order against in 2011. Paulette Goetz and James Chase of Corporate Associates, Inc. are charged with securities fraud involving victims 60 or older. The Nevada Attorney General’s office served as the prosecuting agency.

The indictment alleges that Goetz and Chase defrauded five victims of nearly $180,000, claiming their investment funds would be placed in a “blocked trust fund account” and that they would earn a minimum of 10% return each month.

Goetz and Chase are charged with three counts of securities fraud and a single count of unlawfully transacting business as an unlicensed broker dealer or sales representative, both category “B” felonies. Goetz also faces two counts of theft, one count of multiple transactions involving fraud or deceit in course of enterprise or occupation, and one count of racketeering, all category “B” felonies.

Two other individuals, Kathleen McCarthy and Gene Grobstein, are also charged with one count of theft each, a category “B” felony, in the same case.

“As a former criminal prosecutor, I make it a top priority to combat financial fraud and address abuses of Nevada’s securities statutes and regulations,” said Secretary Miller. “The Securities Division is constantly on the lookout for unregistered securities and unlicensed agents to protect investors from misleading offerings and potentially fraudulent schemes.”

Warrants were issued for all four co-defendants, with bail set at $280,000 for Goetz, $80,000 for Chase, and $20,000 each for McCarthy and Grobstein.

The Secretary of State’s Securities Division issued the cease and desist order against Corporate Associates, Inc. in 2011 for allegedly selling or offering for sale unregistered securities. Goetz and Chase were listed as company representatives on its website.

CAI’s offering was not registered as a security in the State of Nevada, CAI was not a licensed broker/dealer or investment adviser, and neither of CAI’s listed representatives was licensed as a securities sales representative.

The indictment includes a criminal forfeiture of assets derived from the crime. Anyone who has made investments with Corporate Associates, Inc. is asked to contact the Secretary of State’s Securities Division at 1-800-758-6440.

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