SEC charges CMI Capital over alleged $860,000 investor fraud

CMI Capital LLC and its founder and manager, Michael D. Williams, face SEC charges over an alleged investment scheme that raised approximately $860,000 from at least 18 investors. Many were current or retired law enforcement officers in South Florida, according to the SEC’s Sept. 23 enforcement announcement.

The alleged conduct ran from at least October 2023 through August 2024. The SEC says Williams used false and misleading statements to solicit investments in two funds he controlled, including claims that one fund had a portfolio value above $5 million and returns exceeding 140%.

The numbers matter because the pitch combined an apparently large reported portfolio with an investor group tied to a professional community. The SEC says investors trusted Williams partly because of his association with a third-party police and firefighter pension plan administrator. The two funds’ names were not provided in the material accompanying the charges.

The SEC alleges Williams misappropriated approximately $384,000 of investor and client funds for personal expenses, including credit card balances, a sports car and vacations. He began repaying certain investors in August 2024 and has repaid more than $375,000 to certain investors.

That repayment equals at least 97.66% of the alleged $384,000 misappropriation: $375,000 divided by $384,000. Because the SEC describes both figures as approximate or “more than,” the calculation is a floor-like comparison rather than a final recovery rate for all investors.

The alleged proof included performance material. “We allege that one of the tactics the defendants used to trick investors was to send them cropped screenshots of graphics that showed exorbitant trading profits,” Stephanie N. Moot, Director of the SEC’s Miami Regional Office, said in the agency’s announcement.

For crypto-native readers, the document’s practical warning is familiar even though the case does not concern a crypto protocol: screenshots and headline returns do not establish custody, portfolio value or realized performance. The SEC’s stated advice is direct: “We strongly urge all investors to use caution when entrusting their funds to others and to be wary of anyone promising high returns with little to no risk.”

The SEC filed its complaint in the U.S. District Court for the Southern District of Florida. It charges Williams and CMI Capital, also known as Check Mate Investments, with violating antifraud and registration provisions of the Securities Act of 1933, plus antifraud provisions of the Securities Exchange Act of 1934 and the Investment Advisers Act of 1940.

The defendants have agreed to a bifurcated settlement, subject to court approval. Without admitting the allegations, they consented to proposed judgments that would permanently bar them from violating the charged provisions. The SEC’s accompanying order says Williams would also be barred from participating in the issuance, purchase, offer or sale of any security, apart from certain transactions in his personal accounts.

The proposed judgments leave the financial remedies open. The court is to determine disgorgement with prejudgment interest against Williams and civil penalties against the defendants. Williams also agreed to a forthcoming associational bar, but the material does not state its terms or the date it will take effect.

That creates the immediate consequence: investors remain tied to a court-supervised resolution while the eventual disgorgement and penalty amounts are pending. For comparison, an SEC order against Ameritas Advisory Services, LLC dated Feb. 25, 2022, required $3,334,804 in disgorgement, $543,390 in prejudgment interest and a $750,000 civil penalty. The Ameritas amounts do not determine the outcome here; they show why the final figures in the CMI Capital matter remain material.