The Florida Office of Financial Regulation is investigating allegations that several companies and individuals sold CDs to investors, primarily elderly, by falsely claiming the CDs were insured by the Federal Deposit Insurance Corp.(FDIC).

A Brevard County Circuit Court issued an injunction on Nov. 27th. against First Merchant Capital LLC, Capstar Industries LLC, Southeast Mutual Insurance and Investment Inc., Donald Ray Babb, Ralph V. Ruth and Catherine Ruth.

Accused of luring at least 30 customers to invest nearly $3 million in the CD program since August 2011, the defendants allegedly sold the CDs to customers searching for ultra-conservative investments with FDIC-insurance backing.

Their sales pitch, which also included ads in the Tampa Bay Times and Jacksonville’s Florida Times-Union, promised the CDs were paying the “highest rates in the nation,” regulators said. They are also investigating whether the investors’ proceeds have been misused.

These companies are now under receivership as the inquiry continues.

If you or an elderly family member have experienced losses through your broker/financial advisor, call a Securities Arbitration Lawyer at the Florida-based Soreide Law Group for a free consultation on how to potentially recover your losses: 888-760-6552.