achieve-community-logoWe reported on the 20th of February that the SEC, Troy Barnes and Kristi Johnson had all filed stipulation agreements requesting a preliminary injunction be granted.

The SEC filed this action to halt an ongoing Ponzi scheme.

The injunction would replace the current temporary ex-parte injunction, maintaining the fund freeze the temporary injunction granted. Barnes and Johnson would also prohibited from further committing and acts of fraud.

At a hearing on Monday February 23rd, the SEC was granted an injunction against Troy Barnes.

The assets, funds, or other property of Troy A. Barnes, wherever located, which derive, directly or indirectly, from any investor funds obtained by or on behalf of the Defendants or Relief Defendant in connection with the scheme alleged in the SEC’s Complaint, are frozen.

At the time of publication, some $2.5 million in invested funds have been frozen. No word yet on the status of Johnson’s injunction but a hearing is scheduled today on the matter (February 24th).

The SEC has requested the court to permit witness testimony via telephone in support of their request, should it be required.

As the SEC’s civil investigation continues, it’s become evident that the agency will need to finely dance between their own interests and that of an ongoing criminal investigation.

Depositions for both Barnes and Johnson were scheduled for February 20th and 23rd, however the duo both responded by informing the agency they’d ‘invoke their Fifth Amendment privileges in response to questions during their depositions.

fifth-amendment-deposition-pleading-troy-barnes-achieve-community

As such both depositions were cancelled.

For those unfamiliar with the amendment,

The Fifth Amendment of the U.S. Constitution provides, “No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a grand jury, except in cases arising in the land or naval forces, or in the militia, when in actual service in time of war or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.”

Either Barnes and Johnson are facing a grand jury indictment, or they’re not wishing to serve as witnesses against themselves in a concurrent criminal case.

Who is conducting the criminal investigation at this stage is unclear, however history tells us it’s likely to be the Department of Justice. We’ll keep an eye out for developments on that front.

One interesting aspect of the SEC’s civil case meanwhile is the response, or lack thereof, from Work With Troy Barnes and Achieve Community International LLC.

Both companies were named defendants in the SEC action, with Work With Troy Barnes used to launder funds in the US and Achieve Community International set up by Johnson with the aim of laundering funds internationally.

From a declaration filed by an SEC attorney in support of their preliminary injunction request;

The SEC has learned that Defendant Barnes has discussed moving victim funds in this matter outside of the United States in a manner that would make recovery for the benefit of investors particularly difficult or impossible.

Whether the pair failing to reply to the SEC’s action is an oversight or deliberate ploy by Barnes and Johnson is unclear.

On February 6, 2015, Defendant Johnson withdrew approximately $80,000 in TAC investor funds in cash from a TAC-related account or accounts.

Ditto funds attached to these companies and where they might be hidden.

 

Footnote: Our thanks to Don@ASDUpdates for providing a copy of the SEC’s Motion For A Preliminary Injunction and supporting documents.