Loading
SARASOTA — The U.S. Securities & Exchange Commission is alleging that a Sarasota company committed securities fraud and that its CEO used at least $1.8 million for personal trips and other expenses.
The agency contends EnviraTrends Inc. and CEO Russell Haraburda misled roughly 100 investors in 13 states who gave the company $2.3 million to develop and sell pet memorials, personal scooters and exports to China, according to a complaint filed Monday in federal court in Tampa.
Haraburda, 60, allegedly used money provided to EnviraTrends from mid-2009 to early 2014 to pay his mortgage, take a vacation to the Bahamas, make car and motorcycle payments, pay his daughter's college tuition, fund shopping sprees and meet alimony requirements.
EnviraTrends never developed or sold any product or service, however, the SEC alleges in court documents. Haraburda also falsely told investors the company was preparing an initial public stock offering.
“Rather than conduct legitimate business operations, EnviraTrends activities consisted largely of preparing false and misleading materials promoting the company, soliciting new investors and providing false assurances to existing investors,” the SEC civil lawsuit states.
Haraburda also created back-dated “sham promissory notes” from EnviraTrends that indicated the company owed him nearly $412,000 from loans he claimed to have made.
The promissory notes were created to justify the use of company funds for Haraburda's personal expenses, the SEC contends.
A proposed final judgment also has been entered in the case but it has yet to be considered by the court, documents indicate.
Your free article limit has been reached this month.
Subscribe now for unlimited digital access to our award-winning business news.
Join thousands of executives who rely on us for insights spanning Tampa Bay to Naples.
