Office of Missouri Secretary of State
– Jason Kander –
For Immediate Release: January 29, 2014
Contact: Stephanie Fleming, (573) 526-0949
Kander Stops St. Louis Mobile Home Purchasing Scheme
Jefferson City, Mo. — Secretary of State Jason Kander today issued a cease and desist order against Michael Hathman of Maryland Heights, Mo., and Steven Scharf of St. Charles, Mo., and their company Storm Crow Investments, LLC (SCI). The order alleges Hathman and Scharf solicited potential investors with an investment opportunity they claimed would guarantee significant returns.
The order alleges Hathman and Scharf were not registered to sell securities in Missouri when they solicited investors with an opportunity to purchase real estate properties and mobile homes through a website called “Great Real Estate Investments.” The website made numerous claims to potential investors regarding the safety of investing through SCI and claimed to offer returns as high as 200 percent or more.
“Promises of extremely high returns and low risk should serve as red flags to investors,” Kander said. “Call my office before turning over your hard-earned money to make sure the investment and the person offering it are registered.”
According to the order, Hathman, who held a real-estate license until 2012, came into contact with a Missouri resident considering the purchase of a home in the St. Louis area after having received an inheritance. Hathman allegedly solicited the Missouri resident with an investment opportunity he deemed “certain to get a 100 to 200 percent return” and claimed it had no risks. The Missouri resident invested $35,000 with Hathman, Scharf and SCI with the belief funds would be used to purchase homes to resell for a profit, and was told the funds would be deposited into an Edward Jones account.
An investigation by Kander’s office reviewed the bank records of Hathman, Scharf and SCI, revealing that investor funds were never placed into an Edward Jones account. Instead, the funds were used for other business and personal purposes of Hathman’s and Scharf’s. Kander’s order alleges Hathman, Scharf and SCI used the investor’s funds to make ATM withdrawals and purchases from companies including Ameristar Casino, Regal Cinemas, Panda Express, Club Fitness, the St. Louis Rams and Denny’s Restaurant, among others. Further, Kander’s order alleges that Scharf used investor funds to make at least $11,469.50 in cash withdrawals and pay $3,800 in child support.
The order seeks restitution, fines and the cost of the investigation.
Before making an investment decision, Missourians are encouraged to call Kander’s office at 1-800-721-7996 or visit www.MissouriSafeSavings.com.
