Litigation Releases (William Rhew III)

U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 26129 / September 25, 2024

Securities and Exchange Commission v. William Rhew III

, No. 1:24-cv-00771 (M.D.N.C. filed Sept. 23, 2024)

SEC Charges North Carolina Business Owner with Multimillion-Dollar Fraud

The Securities and Exchange Commission today announced charges against Greensboro, North Carolina resident William Rhew, III for defrauding investors in Chadley Capital LLC, a company that Rhew owned and controlled.

According to the SEC's complaint, between November 2017 and December 2023, Rhew raised over $28 million from approximately 130 investors by offering notes with guaranteed annual returns of up to 48 percent through purported private investments in manufacturing debts. Instead, the SEC alleges, Rhew used investor funds to make payments to existing investors and fund his lavish lifestyle, including purchasing flights on a private jet, a waterfront home, a Mercedes automobile, and a pleasure boat. The complaint further alleges that Rhew used investor money to pay his personal expenses and fund the operating expenses of a now-bankrupt, unrelated retail business that he owned and controlled. To conceal the fraud, Rhew periodically created and provided investors with fictitious account statements reflecting profits and increased asset values.

The complaint, filed in the United States District Court for the Middle District of North Carolina, charges Rhew with violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC seeks a permanent injunction, disgorgement with prejudgment interest, civil penalties, an accounting, and a permanent officer-and-director bar. The SEC also seeks an injunction that permanently bars Rhew from participating in the issuance, purchase, offer, or sale of any security, except for purchases and sales in his own personal accounts.

The SEC's investigation was conducted by Katie Shelton, Krysta Cannon, and Melissa Mitchell, and supervised by Matthew McNamara and Justin Jeffries. The SEC's litigation will be led by William Hicks and supervised by M. Graham Loomis.