LEE'S SUMMIT, Missouri - Secretary of State Robin Carnahan filed a cease and desist order against a Lee’s Summit businessman they say operated a $3.5 million Ponzi scheme.
The order said there were at least 40 investors, many located in the Kansas City area. Ronald W. Shepard, who also is of the Lake of the Ozarks area, allegedly spent some of the money on furs, jewelry cars and cash for family members.
The order identifies Shepard doing business as Shepard and Associates, Tow-Safe, The Real Estate LLC and Safety Solutions USA LLC.
Beginning in 2006, Shepard allegedly convinced the investors to invest in the companies, telling them the money would be used to develop real estate and to marke and produce a safety trailer hitch for which Shepar was seeking a patent. He allegedly promised returns of between 10% and 100% to investors.
In the 14-page order, state officials said Shepard spent $938,633 obtained from investors on family members and himself.
Yet, according to a statement released by Carnahan's office Monday, Shepard had been the subject of a state cease and desist order in 2004, had pleaded guilty in 2009 to federal criminal charges in connection with student loan fraud and filing false tax returns.
He is currently on probation, the statement said.
This kind of information would be available to investors who check with state securities officials for information about any investments they are offered and the individuals who offer them.
"We want to get his name out there," said Laura Egerdal, a spokeswoman with Carnahan's office. "We have been contacted by 40 investors, so we think there could definitely be more people out there."
Shepard was not registered in Missouri to offer investments.
To check the Missouri Investor Protection Hotline, call 800-721-7996. In Kansas, call 800-232-9580.
Shepard faces thousands of dollars in possible penalties and cost, according the statement. He has 30 days to request a hearing on the order's allegations.