Elderly Investors Fooled! Crook Bleeds $1 Million, Buys Himself Lavish Life!

SEC v. Marshall E. Melton, Integrated Consulting & Management, LLC — U.S. Securities and Exchange Commission Litigation Release No. 26292, dated April 24, 2025.

The SEC won a summary judgment against Marshall E. Melton and his company for defrauding investors out of over $1 million. Melton misrepresented how investor funds would be used for property development, instead using nearly two-thirds for personal expenses. The court found violations of antifraud provisions and an affirmative duty to disclose Melton's disciplinary history.

In Plain English

Imagine you give money to someone to invest in a project, like building a new shop. This person promises to use your money for the shop and make you a profit. But instead, they secretly spend most of your money on themselves, like buying a fancy car. They also didn't tell you they had a bad history with money before. That's what happened here, and the court said it was against the rules.

Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.

How the Alleged Scheme Worked

1. Raising Funds for Laurinburg Properties Marshall E. Melton and his company, Integrated Consulting & Management, LLC, solicited over $1 million from investors. They represented that these funds would be used to buy and develop properties in downtown Laurinburg, North Carolina.
2. Targeting Vulnerable Investors The scheme specifically targeted investors who were often elderly. Six of the seven investors had an average age of 75 when they invested, making them a particularly vulnerable group.
3. Misrepresenting Use of Funds Melton falsely represented that investor funds would be used for the Laurinburg property development. The SEC's complaint alleged that Melton intended to spend large portions of the money on personal expenses unrelated to the project.
4. Misappropriating Investor Money Instead of using the funds as promised, Defendants in fact misused nearly two-thirds of the investor funds. This money was diverted for Melton’s personal use, directly contradicting the investment pitch.
5. Failing to Disclose Disciplinary History The court found that Defendants had an affirmative duty to disclose Melton’s securities disciplinary history. This included a prior SEC enforcement action and a prior criminal proceeding based on similar conduct.
6. Breaching Duty to Disclose This duty to disclose arose due to Melton's longstanding financial advisory relationship with some investors and his claims of investment expertise to others. The failure to disclose this history was deemed a material omission.

The Enforcement Action

On April 17, 2025, the U.S. District Court for the Middle District of North Carolina granted the SEC’s motion for summary judgment against Marshall E. Melton and Integrated Consulting & Management, LLC. The court found Defendants violated antifraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934, and Rule 10b-5 thereunder, based on misrepresentations regarding the use of investor funds. The court also found Defendants failed to disclose Melton’s prior SEC enforcement action and criminal proceeding, which constituted a material omission. Remedies will be decided at a later date. The SEC’s litigation was led by M. Graham Loomis and Robert Schroeder. The investigation was conducted by Micheal D. Watson under the supervision of Stephen E. Donahue.

Named in this action: Marshall E. Melton, Integrated Consulting & Management, LLC.

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