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Posted on: February 10, 2014

Proud Veterans Ordered to Cease and Desist for Violating Kansas Securities Laws

Derby, KS--- Kansas Securities Commissioner Josh Ney has issued a cease and desist order and notice of intent to impose administrative sanctions against Proud Veterans, LLC and its CEO, Nick Gnemi, of Derby.

The cease and desist order preliminarily finds that Proud Veterans and Gnemi committed securities fraud by selling an unregistered security, by making untrue statements, and omitting material facts regarding the unregistered security. According to the petition filed by agency staff, Gnemi allegedly told a Kansas resident that they could invest money with Proud Veterans, which would be used as an investment toward stock and commodities of grain and milk that would be delivered to foreign countries, such as Afghanistan, Dubai, Egypt, and other various countries. Additionally, the resident was allegedly told that the investment would return 17.25% per year and carry no risk. After investing in Proud Veterans, the Kansas resident allegedly received only a partial payment with an explanation that Proud Veterans did not have enough money in its account to cover the full payment. The Kansas resident requested the return of the investment but has yet to receive a return of the funds.

The order instructs Proud Veterans and Gnemi to cease and desist from offering or selling any unregistered securities in Kansas. The notice of intent provides notice that the Kansas Securities Commissioner intends to impose civil penalties of up to $25,000 for each violation of the Kansas Uniform Securities Act. If either party wish to challenge the preliminary findings contained in the cease and desist order, Proud Veterans and Gnemi have the opportunity to request a hearing within thirty days after service of the order.

If you have been approached by these individuals regarding investing in Proud Veterans, please contact the Office of the Kansas Securities Commissioner at 785-296-3307.

A PDF of the Press Release is available here: http://ksc.ks.gov/DocumentCenter/View/247

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The mission of the Office of the Kansas Securities Commissioner (KSC) is to protect and inform Kansas investors; to promote integrity, fairness, and full disclosure in financial services; and to foster capital formation.

Click here to view a copy of the order.
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