Skip to page body Home Information Center Election Center Business Center Licensing Center Securities Center Online Services

Press Releases

News Review
Theft Related to the Sale of Securities Results in Prison Sentence and Fines for One Man, Two Others Awaiting Sentencing
Nevada Secretary of State Warns Investors that Three Separate Cases Point to Potential Trend in Illegal Crowdfunding
Posted Date: 12/6/2012

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

(Las Vegas, NV; December 6, 2012) – One man is facing four years in prison, fines and restitution while two others await sentencing as a result of three different cases alleging the illegal offer or sale of securities. In each case it was believed that the seller utilized the internet to offer or promote securities. Nevada Secretary of State Ross Miller says the cases demonstrate the need for continued investor awareness and caution due to the potential for internet scams, and the fact that crowdfunding for securities that are not registered with the Securities and Exchange Commission (SEC) is not yet legal.

Crowdfunding is generally defined as a method of financing or funding a project with relatively small contributions from a large group of individuals, often conducted online through dedicated crowdfunding sites. Although the Crowdfund Act was signed into federal law in April 2012 as part of the JOBS Act, the SEC has not yet passed regulations governing crowdfunding, so the process may not be utilized by those issuing or selling unregistered securities. Nonetheless, numerous internet sites have cropped up since April poised to offer crowdfunding investment opportunities.

“Until the SEC promulgates regulations, crowdfunding as contemplated by the Crowdfund Act is a completely unregulated and illegal process,” said Miller. “When the regulations from the SEC do go into effect, they may be fairly restrictive, and there’s a reason for that. When something new like this comes along, it’s natural for people to want to get in early, but these are often high-risk investments and should be left to sophisticated investors who can afford the inherent risks.”

In all three of the current Nevada cases, perpetrators were believed to have used internet sites to either promote or sell illegal securities or to attract investors:

  • Mark D. Jones of Cedaredge, Colo. was sentenced in Clark County District Court on Wednesday, Dec. 5 to four years in prison without probation on one count of theft related to the sale of a security. He was also ordered to pay $130,000 in restitution, plus expenses related to the investigation, and he has been banned from the securities industry. Jones was arrested in Pagosa Springs, Colo. on February 23, 2010 and extradited to Las Vegas to face the charges investigated by Nevada Secretary of State.
  • Robert Burke of Hurst, Tex. is set for sentencing after pleading guilty to one count of securities fraud and one count of conspiracy to commit a crime. He was arrested in Tarrant County, Tex. on October 26, 2010 and extradited to Las Vegas to face charges investigated by Nevada Secretary of State. Burke failed to appear at the sentencing and a bench warrant has been issued for his arrest.
  • Thomas O’Donnell, previously from Las Vegas, Nev., is also awaiting sentencing after pleading guilty to one count of securities fraud. He was extradited to Las Vegas from a Florida prison on a warrant issued June 20, 2011 to face charges investigated by the Nevada Secretary of State. O’Donnell is scheduled to be sentenced on December 12, 2012.

The Nevada Attorney General’s office is the prosecuting agency for all three cases.

Secretary Miller urges investors to learn the warning signs of investment fraud and independently verify any investment opportunity, as well as the background of the person and company offering the investment. “The Securities Division can provide detailed background information about licensed individuals who sell securities or give investment advice, and verify the registrations of the products being offered. Investors should do business only with licensed brokers, investment advisers, and issuers complying with the law and should report any suspicion of investment fraud to us.”

Additional information on how to protect yourself from investment fraud is available on the Secretary of State’s website, The Securities Division’s telephone number is (702) 486-2440.

Securities Arrest

Mark D. Jones booking photo

# # #

Free viewers are required for some of the attached documents.
They can be downloaded by clicking on the icons below.

Download Acrobat Reader Download Flash Player Download QuickTime Download Windows Media Player Download Microsoft Silverlight Download Word Viewer Download Excel Viewer Download PowerPoint Viewer