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SEC Charges 'Psychic Investor' With Fraud

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The SEC today charged Sean David Morton with scamming $6 million from 100 investors in his Delphi Investment Group (the individuals would put money in one of three companies- Vajra Productions, LLC, 27 Investments, LLC, and Magic Eight Ball Distributing, Inc.- all under the Delphi umbrella). Morton, who bills himself as "America's Prophet" (so punny!), with his wife Melissa, apparently reeled in the cash by convincing potential investors that his psychic abilities would make them "piles of money," if they acted fast.

According to the Commission’s complaint, Morton used his monthly newsletter, his website, his appearances on a nationally syndicated radio show called Coast to Coast AM, and appearances at public events, to promote his psychic abilities. Morton made numerous materially false representations relating to his psychic abilities in order to solicit investors for the Delphi Investment Group. For example, Morton wrote to potential investors in his July 20, 2006 newsletter that: “I have called ALL the highs and lows of the market, giving EXACT DATES for rises and crashes over the last 14 years.” (emphasis in original.) The Commission alleges that this assertion, like others Morton made in soliciting investors, is false.

This is also good:

In one-on-one correspondence with potential investors, Morton was even more aggressive in his solicitation. For example, on October 7,2006, Morton wrote to a potential investor, Investor G, in two separate emails: "The more [money] you get me the MORE 1 can make for you" and "[g]ive ME enough money to help YOU! Give me enough so that the average profits will make a DIFFERENCE in your life." (emphasis in original.) In a subsequent email, after Investor G had already invested with the Delphi Investment Group, Investor G told Morton that he would like to invest in other types of investments such as the stock market. Morton replied, "for RIGHT NOW you will make the most with [the Delphi Investment Group]. Once the DOLLAR starts to DROP, which will happen soon, we are set to make a FORTUNE!" (emphasis in original.)

I'm sure a lot of you will be quick to label these people, like Investor G, as pretty stupid for falling for such an obvious scam. But we did a little investigative research (went to Mr. Prophet's website) and have another theory. Nobody was duped by the psychic claims. They just got a load of Morton with people such as, for example, ANTHONY MICHAEL HALL and figured this guy must be legit. You probably would've, too.

SEC Charges Nationally Known Psychic in Multi-Million Dollar Offering Fraud [SEC via FTAlphaville]