According to the federal securities regulators, the defendant used most of the investor funds for personal expenses including gambling and jewelry. During the relevant period, he did not trade any stock.
Furthermore, the SEC alleged that the defendant covered up his fraud by using new investor funds to pay back earlier investors, which is considered a Ponzi scheme.
The SEC noted many of Dosal’s investors suffered losses due to his fraud. He violated Section 17(a) of the Securities Act, Sections 10(b) and 15(a) of the Securities Exchange Act, and Rule 10b-5 thereunder.
“As alleged in our complaint, Dosal enticed military service members and others to invest with false claims that he was a highly successful day-trader. The SEC will continue to vigilantly pursue fraudsters who prey upon those who serve our nation,” according to said Gottschall, Regional Director for the SEC, Denver Regional Office.
Dosal settled with the SEC
Dosal agreed to settle without admitting or denying the charges against him by the federal securities regulators in the lawsuit.
