Longmont equity fund charged with fraud

LONGMONT – A private-equity fund in Longmont and its principals allegedly defrauded more than 20 investors out of $3.2 million, according to a complaint made by Colorado Securities Commissioner Fred Joseph on Friday.

The complaint was filed in Denver District Court against Gary Snisky of Longmont, David Burch of Aurora, and Brenda Ridley of Bakersfield, California, along with Colony Capital LLC, Colony Capital LP and Colony Capital Group, a private equity fund operating in Longmont, according to a press statement from the Colorado Division of Securities. Joseph wasn’t immediately available for comment.

The complaint alleges that the three principals carried out a scheme to defraud investors in a private equity fund controlled by Snisky, according to the press statement. From 2008 to July 2010, Snisky allegedly induced investors based on promises of return on their investments, according to the press statement.

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Snisky allegedly used investment proceeds for personal expenses, according to the complaint. None of the defendants was licensed with the state securities commission, according to the press statement. The Longmont firm is not affiliated with the Los Angeles real-estate investment fund with the same name

Snisky was charged with engaging in investment adviser fraud, securities fraud, offer and sale of unregistered securities and unlicensed investment adviser activity, according to the press statement. The other two principals were charged with engaging in unlicensed securities sales activity. The complaint seeks damages on behalf of investors harmed by the defendants.

The Colorado Division of Securities enforces state securities laws. The division also licenses and regulates stockbrokers and investment advisers in the state and investigates cases of alleged securities fraud.