Jack Utsick, a Florida-based promoter who has financed a few shows in Central Arkansas (such as Hootie and the Blowfish at the amphitheater back in 2000), has run afoul of the Securities and Exchange Commission, according to the Dow Jones news service.
His problems, the report says, center around the raising of $300 million from 1998-2005 by selling investments in shows with big-name entertainers:
WASHINGTON - The Securities and Exchange Commission said Monday it has charged independent promoter Jack Utsick and affiliates with improperly raising $300 million from 1998 through 2005 by selling investments in shows featuring performers such as Shania Twain and Aerosmith.
The SEC said that it has filed an injunctive action in U.S. District Court for the Southern District of Florida seeking to appoint a receiver to take over the assets that remain in Miami-based Worldwide Entertainment Inc. and other companies that helped perpetrate the fraud.
Investors were told that they would make as much as 15 percent to 25 percent a year, even though many of the entertainment projects lost money, regulators said. As a result, Utsick and his companies paid longtime investors with money they received from new investors, the SEC said. That sort of arrangement, known as a "Ponzi scheme," typically leads to investor losses.
Utsick used some investor money to open an options trading account through which he lost $17 million, and also used some of it to buy two multimillion-dollar condominiums in Miami Beach and to fund a lavish lifestyle, the SEC said.
The SEC said Utsick and other defendants have already agreed to repay amounts they received along with penalties. The SEC didn't specify the amounts of those penalties. It said that the defendants consented without admitting or denying wrongdoing.