What happened to more than $3 million that was allegedly raised by venture capital fund Ventures Trust II to purchase Facebook shares prior to the social network’s initial public offering? The Securities and Exchange Commission is attempting to answer that question.
CNET reported that the SEC issued subpoenas for the financial records of Ventures Trust II Manager Paul Tabet and his wife, Jenifer Tabet, as part of its investigation of allegations that Paul Tabet and fellow Manager Craig Berkman raised more than $3 million to purchase Facebook shares before the company went public May 18.
According to CNET, attorneys for the SEC told a federal judge:
Staff has obtained evidence that a forged letter on law firm letterhead stating that Ventures Trust owned a direct interest in almost 500,000 pre-IPO shares of Facebook was apparently used to solicit Ventures Trust investors. Staff has evidence indicating that the forged letter was attached to an email sent by Paul Tabet to at least one potential investor.
The commission added that it has evidence showing that Paul Tabet withdrew more than $1 million from Ventures Trust bank accounts, and that $23,000 was transferred to Jenifer Tabet’s bank account, CNET reported.
According to CNET, Paul Tabet said in a written response to the SEC that the subpoena was “overly broad,” “oppressive,” and a “warrantless search and seizure.”
Berkman has a shady past, as well, as CNET reported that he is a former investment banker who has acknowledged that he “loaned” himself funds from his clients’ accounts, and he allegedly moved from Portland, Ore., to Florida in order to escape creditors that remain unpaid after several years.
Readers: Did you or anyone you know find themselves on the receiving end of a suspicious proposition involving Facebook shares?