$20 Million Securities Fraud Case Closed

By Katie Hauser

Published on October 13, 2006

James and Nancy McMichael were accused by the Securities and Exchange Commission of using PhyMed and Healthcare Preferred, the two companies of which they were executives, to fraudulently offer and sell roughly $33 million in securities to more than 500 investors scattered across 23 states.

The SEC argued that the couple misrepresented or withheld crucial information from investors.

The McMichael's companies, which have since gone out of business, were used to dupe investors out of more than $20 million. James McMichael was ordered earlier to pay back this amount and was sentenced to prison after pleading guilty to a related charge.

With the most recent ruling, Judge Richard Lazzara of the Middle District of Florida prohibited the couple from any more violations of securities law, according to a release from the SEC.

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