
The U.S. Attorney's Office for the Southern District of New York and the Securities and Exchange Commission on Tuesday each announced charges against individuals in connection with two municipal bond offerings totaling more than $280 million, proceeds from which were used to finance construction of an Arizona sports complex that tumbled into default and bankruptcy.
In
The SEC's complaint, filed in the U.S. District Court for the Southern District of New York, charges Randall Miller, Chad Miller, and Jeffrey De Laveaga with violating the antifraud provisions of the federal securities laws, the commission said in a press release. The complaint seeks permanent injunctions, conduct-based injunctions, disgorgement with prejudgment interest, and civil penalties, the release said.
"As our complaint alleges, these defendants used fake documents to deceive municipal bond investors into believing a sports complex would generate more than enough revenue to make payments to bondholders," Antonia Apps, acting deputy director of the SEC's Division of Enforcement, said in the release.
Maintaining the integrity of the roughly $4 trillion municipal bond market "is critical for local governments and investors alike," Apps said.
"The SEC will hold accountable individuals who defraud municipal bond investors," she said.
Also on Tuesday, Matthew Podolsky, the acting U.S. Attorney for the Southern District of New York, and Christopher G. Raia, the assistant director in charge of the New York Field Office of the Federal Bureau of Investigation, announced the unsealing of an indictment charging Randy Miller, the former chairman and president of Legacy Sports, and his son, Chad Miller, the former CEO of Legacy Sports, with engaging in a scheme to defraud investors of more than $280 million in the Legacy Cares muni bond offerings.
Legacy Cares' initial January 2023 payment default on the bonds issued through the Arizona Industrial Development Authority was followed by
The father and son were arrested on Tuesday and will be presented on Wednesday in the U.S. District Court for the District of Arizona, according to a press release from the U.S. Attorney's Office for the Southern District of New York.