The SEC yesterday charged The Eye Machine and its founder Peter Pocklington with defrauding investors through the misappropriation of investor funds and by hiding Pocklington’s felonious history from investors.
Pocklington, a former Edmonton Oilers NHL team owner, plead guilty to a federal felony perjury charge in 2010 and was ordered to pay more than $5 million to settle unrelated securities fraud and registration charges, the SEC said in its statement.
He went on to found and control medical device company The Eye Machine, now known as Nova Oculus Partners, which raised more than $14 million from over 260 investors in unregistered offerings between 2014 and 2017, the SEC claims.
In its official complaint, the SEC claims that Pocklington and his attorney Lantson Eldred structured the ownership of The Eye Machine to hide Pocklington’s involvement with the company, using Eldred as the “visual front.” During funding rounds, the company and its heads failed to disclose Pocklington’s history and involvement with the company, as well as misrepresenting how funds would be spent.
The SEC alleges that Pocklington misappropriated more than $600,000 in investor funds for personal use including supporting gold mining companies and to pay for personal legal and credit card bills.
The complaint goes on to allege that The Eye Machine paid millions in undisclosed and excessive sales commissions to an additional three individuals who acted as unregistered brokers for the company, one of whom was barred from acting as a broker-dealer. Two of the unofficial brokers are accused of using “boiler room” operations in Florida to “cold call” investors.
The charges were filed in the federal court in California and charge Pocklington, Eldred and The Eye Machine with violating antifraud and securities registration provisions. Charges were also levied against The Eye Machine majority shareholder AMC Holdings, company in-house accountant Terrence Walton and the unregistered brokers, according to the SEC posting.
“Investors should know when a recidivist plays a central role in a company’s operations and offerings. Investors should research the background of anyone offering an investment, but they can only do this if the offering accurately and adequately discloses the individuals involved,” SEC Los Angeles regional office director Michele Layne said in a press release.
Registration is open for DeviceTalks Boston! Join us on June 5-6, 2019, as we explore the trends and technology that are shaping the future of the medical device industry.