The Texas State Securities Board (“TSSB”) and the Alabama Securities Commission (“ASC”) recently issued cease and desist orders against First Class Wealth Management (“First Class”), ordering it to shut down illegal operations in those states.
According to the orders, First Class was founded by Mitchell Kane Milizio in 2019. Milizio, along with sales agent Jason Shaw, are accused of encouraging investors to liquidate securities holdings and then use the proceeds to invest in the First Class investment scheme.
As stated in a news release from the ASC:
“The orders accuse First Class and its agents, Mitchell Kane Malizio and Jason Shaw, of illegally promoting a fraudulent precious metals advisory scheme. According to the order, First Class sent unsolicited advertisements by email, including to the email accounts of ASC and TSBB, and through Facebook. First Class is encouraging people to liquidate securities and use the proceeds to purchase precious metals through self‐directed individual retirement accounts, which can be set up for investors through a company recommended by First Class. In the solicitations, First Class makes several misrepresentations and omissions to induce investors to transfer their assets, and neither First Class, Malizio, nor Shaw are registered to provide investment advice in Alabama or Texas.”
“First Class claims that investors will not incur out‐of‐pocket expenses and represents that no commissions are charged. Instead, they claim that sales representatives are paid by the self‐directed IRA company. However, the self‐directed IRA company denies this claim and the investigation revealed that First Class was profiting in its own way. For example, ASC and TSSB identified a purchase made by an investor in which First Class paid just over $85,000.00 for precious metals but sold those precious metals to an investor for $200,000.00. This ‘fee’ was not disclosed to investors.”
Fishman Haygood’s Investment Fraud Division has experience bringing claims on behalf of investors who were duped in fraudulent schemes like First Class Wealth Management. Please contact us to discuss your possible claim.