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State investors warned about 'Profitable Sunrise' scam

State investors warned about 'Profitable Sunrise' scam

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State investors should steer away from "Profitable Sunrise," a London-based company running an apparent quick-hitting Ponzi scheme that securities officials in Wisconsin and across the country warned against Thursday.

Investors are instructed to wire money to Eastern Europe and promised risk-free returns of between 1.6 percent and 2.7 percent per day for periods of six months to two years, according to an alert from the state Department of Financial Institutions. The promises — the company's slogan is "Get Richer With Every Sunrise" — were termed "unrealistic" by regulators.

Investors are told that their money would fund short-term loans to businesses and that "all funds deposited with (Profitable Sunrise) are insured against loss."

DFI, in a statement, said the company's activities could be considered the sale of unregistered securities, which is illegal. Neither the company nor its principals — Roman Novak and Radoslav Novak — are registered with DFI's Division of Securities.

Minnesota regulators Thursday accused two men with selling the investments without proper licenses, claiming "the marketing of Profitable Sunrise is filled with confusing statements, omissions of material fact, and misrepresentations. Efforts are made to avoid adherence to regulatory requirements through the employment of marketing language designed to deceive regulators."

On the company's websites, marketing consistently notes the owners' Christian connections and devotion to unspecified charitable causes.

The Minnesota Department of Commerce's cease and desist order explained the "pyramid-like" scheme: "While it claims to be registered and located in the United Kingdom, the multiple addresses on the company's website appear to be false, with one listed as a construction site. The domain name for Profitable Sunrise's website is registered in the United Kingdom, yet the IP address for the website appears to be located on a server in Los Angeles."

The Minnesota order illustrates that, for example, a $1,000 investment would be worth $37,198 at the end of 170 business days.

No complaints have been received from Wisconsin investors, a DFI spokesman said. Anyone who has invested with Profitable Sunrise is encouraged to contact DFI's Division of Securities enforcement office at 608-266-1603.

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