The Michigan Department of Licensing and Regulatory Affairs has ordered former State Rep. Fulton Sheen of Otsego and business associates to stop selling unregistered securities.
Sheen, who served as 80th District State Representative from 2003 to 2009, Terry Leverett of Kansas City, Mo., and Shaar 2, LLC, a Missouri-based company with a registered office in Otsego were named in the LARA order.
Sheen and Leverett also are barred from materially aiding the company in the sale of unregistered securities, contrary to the Michigan Uniform Securities Act (MUSA). The orders indicate that the Michigan Securities Administrator intends to impose a $20,000 fine against each of the respondents. Respondents have the right to request a hearing within 30 days.
“In order to protect Michigan investors, all securities must be registered or exempt from registration,” said CSCL Director Julia Dale. “Investors should ask questions before they invest their hard-earned money and can follow up with CSCL to see if the products and the people selling them are registered,” said Dale.
An investigation prompted by a consumer complaint against the respondents, none of whom are registered in any capacity under the MUSA, disclosed violations of MUSA, including that the respondents offered and sold securities in the form of investment contracts to a Michigan resident, who was 60 years of age or older at the time of sale. The investment contracts were neither exempt from registration nor registered under the MUSA.
A person who willfully violates MUSA or an order issued under that act is guilty of a felony punishable by imprisonment for not more than 10 years or a fine of not more than $500,000 for each violation, or both.
Before entering into an investment, Michigan consumers are encouraged to contact CSCL and the bureau can run a registration check on any investment adviser, broker-dealer, professional, or product. CSCL can be reached at 517-241-6345 or online at: www.michigan.gov/securities.
Investors are reminded that there is no replacement for their own due diligence. Investor education materials may also be found using that link.
Sheen was elected state representative for most of Allegan County in 2002 and was re-elected in 2004 and 2006.
PHOTO: Fulton Sheen
