A 63-year-old man from Irvine, known as Jacques Poujade, entered a guilty plea on Monday for securities fraud. Poujade deceived an investor by falsely claiming that shares of his real estate finance company in Orange County would be publicly traded on the Nasdaq stock exchange. The investor was convinced to provide more than $5 million based on this false information.
Poujade is not only the owner of the Lake Forest-based Tri-Emerald Financial Group but also serves as the company’s chief financial officer. He engaged in the sale of unregistered securities by dishonestly stating that an initial public offering (IPO) was imminent. He promised the investor that the value of their shares would increase from $10 to $100 per share.
However, it was discovered by federal prosecutors that the funds raised by Poujade were not used for the promised purpose. Instead, the money went towards the company’s operating expenses, resolving legal issues with previous investors, and even for Poujade’s personal benefit.
The main purpose of Tri-Emerald was to fund loans as a mortgage banker and then sell those loans to other financial institutions. However, both Tri-Emerald and its securities were never registered with the United States Security and Exchange Commission (SEC). Poujade failed to complete the necessary steps to make the company go public, such as submitting the required paperwork to the SEC or securing investment banks to underwrite an IPO.
Poujade convinced the investor that an investment bank was enthusiastic about the IPO, claiming that Tri-Emerald would become a billion-dollar company within 16 months.
As per the plea agreement, Poujade managed to deceive the investor into providing approximately $5.2 million based on these false promises. Additionally, Poujade admitted to defrauding another victim and their investment group. He persuaded them to purchase promissory notes issued by one of his other companies, LendPlus Holdings, promising that the funds would be used to increase Tri-Emerald’s line of credit for funding more mortgages. However, the money from these investments was also misused for Tri-Emerald’s operating expenses, resolving previous investor disputes, and for Poujade’s personal use.
Poujade’s sentencing is scheduled for October 30th, during which he could face up to 20 years in prison, according to the U.S. Attorney’s Office.
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