The Securities and Exchange Commission has charged a Massachusetts subprime auto lender with fraud for allegedly collecting $110 million through the sales of unregistered notes.
Inofin Inc. and three of the company's executives raised the funds from hundreds of investors in 25 states and the District of Columbia through the sale of unregistered notes, the SEC said. Investors were told that Inofin would use the money for the sole purpose of funding subprime auto loans.
As part of the pitch, Inofin told investors that they could expect to receive returns of 9% to 15% because the company loaned investor money to its subprime borrowers at an average rate of 20%.
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