SEC Posts Complaint Against mUrgent Corp., Accused of Running Boiler Room and $10 Million Scam
The Securities and Exchange Commission has posted online the complaint filed in Santa Ana federal court against mUrgent Corp., a Santa Ana Internet marketing firm for the restaurant and hospitality industry that is accused of using high-pressure sales tactics to defraud investors "in a $10 million boiler room scheme."
Read the complaint release and/or download the actual complaint. Named are mUrgent and the firm's CEO, Vladimir Boris Bugarski, his twin brother and chief operating officer Aleksander Negovan Bugarski and their father and chief financial officer Vladislav Walter Bugarski.
Through high-pressure phone sales, mUrgent representatives in 2008 began selling stock before a purported initial public offering of what was billed as a highly successful company. Though 130 investors nationwide eventually bought in, there really was no looming IPO sale, according to the SEC.
The Bugarskis allegedly misused more than $1.3 million of investor money for salary and bonuses for themselves, while also establishing a separate "slush fund" of more than $500,000 of investor money that was used to pay for luxury cars and personal expenses, according to the complaint.
The SEC claims mUrgent and the top executives violated the Securities Act of 1933 and the Securities Exchange Act of 1934. The agency is seeking injunctions, disgorgement, fines and an order barring the Bugarskis from serving as officers or directors of any public company.
According to the mUrgent Corporation website, the company "delivers the most profitable, full-service email marketing solutions for restaurants that are serious about increasing repeat business and loyalty. mUrgent differentiates itself by providing the restaurant and hospitality industry with the first, all-inclusive, unlimited email marketing program." Clients have apparently included Denny's, Pizza Hut, Golden Spoon, Church's Chicken and Farrell's Ice Cream Parlours.
But if Boris Bugarski would like to market himself as something other than dirty in light of the current charges, he'd better hope government prosecutors do not get ahold of this quote he reportedly gave OC Metro a year ago: "If an employee embarrasses you in front of a client, it's OK to laugh and admit loudly that 'You got me!' with a big high five in the air. Show the client that there's still teamwork, even at your expense. Then, whisper in the employee's ear that if it happens again, they'll find themselves next to Jimmy Hoffa."