The Kentucky Department of Financial Institutions issued an emergency cease and desist order Thursday against an international investment company and the brothers who operate it, according to a news release.
Roman and Radoslav Novak and their company, Profitable Sunrise, were ordered to stop selling securities in Kentucky. The department alleges that the investment products and people selling them were not registered in Kentucky, and that the brothers committed fraud for omitting or misrepresenting facts on the company's website.
"Kentucky investors are being lured into these offers based on incomplete and incorrect information," the department's commissioner, Charles Vice, said in the news release. "We strive to protect investors from fraud by requiring full disclosure by professionals who are registered to conduct business in the state."
Kentucky is one of at least 14 U.S. and Canadian jurisdictions investigating Profitable Sunrise and its operators, the news release said.
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The department also asked the Kentucky attorney general to investigate whether Profitable Sunrise is a pyramid scheme, the news release said.
According to the news release, Roman Novak, of the United Kingdom, is the owner and founder of Profitable Sunrise. His brother, Radoslav, is an associate. They use a website to promote and send information to potential investors.
The website claims that the investment options are risk-free with "a certain rate of return and no chance of default," and it invites potential investors to "get richer with every sunrise," according to the news release.
The company purports to provide short-term loans to businesses throughout the United States. It offers unrealistic returns and pays commissions to entice other investors, Vice said.
"Investors should always be wary of offers that sound 'too good to be true.' But this also appears to be promoted through referrals and word of mouth, and Bible quotations online indicate that this group is targeting the Christian community in particular," Vice said.
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The state's cease-and-desist order can be found online at KFI.ky.gov/legal/Pages/securities.aspx.