Management Solutions Inc

On December 15, 2011, the SEC filed a federal case against father and son Allen and Wendell Jacobson, of Fountain Green, Utah as well as the company that The Two were said to be running, Management Solutions Inc, claiming that it was a $220 million Ponzi operation that was targeting the members of the LDS Church. A freeze order was placed upon their assets.At the time, it was reported to be the single largest fraud ever in the state of Utah.Case Number: 2:2011cv01165

Also on December 15th 2011 the Jacobsons were charged with "Fraudulent Recovery of Unlawfully Transferred Assets" by the victims of the Brian J. Smart ponzi scheme in federal civil action. Case Number: 2:2011cv01170 in the same court that the SEC had filed its action, moments earlier on the same day.

The proceedings were made public by the receiver for the Security and Exchange Commission whom had created a website for the victims and has been providing regular updates regarding movement in the case on that site, www.managementsolutionsreceivership.com.for the victims to follow the case. The receiver recovered assets all over the United States, and in its memo's in support of the many motions, the SEC receiver was able to determine that the Jacobsons would often value the projects it was involved in at upto 500% of the actual price paid to resell to investors using these inflated values.

The SEC alleged that the Jacobsons used their connection as members of LDS Church to solicit 225 investors through a complicated web of entities all under the umbrella of Management Solutions, Inc.

According to the SEC settlement, the Jacobsons “used alleged ‘sales’ as a way of shifting investors in and out of selected properties & LLC's.” The SEC document says most investments were funneled into a “clearing house” corporation known as Thunder Bay Mortgage Company.

In some instances, the SEC's charging document claims that the Jacobsons bought properties they already had owned and then supposedly sold it back to aonther LLC for a profit. They also allegedly moved their money into joint accounts to make it appear to investors they were committing their own capital to a project, only to quickly transfer the money back to their own account.

The SEC complaint alleged that the investors in 4 of the Jacobsons' corporations received a “6 to 8 percent” return on their investments, though the combined income from the corporations was $32,200. Those corporations' expenses over the period they supposedly profited were $1.3 million.

During the case, Allen Jacobson was charged with and held in contempt of court for hiding assets that according to the receiver belonged to the receivership.

On January 4th 2013 the SEC announced via a posting on its website that the Jacobson case had been settledBoth defendants release all claims in all assets recovered by the receiver.

Defendant Wendell Jacobson is liable for disgorgement in the amount of $11,193,005.00 and pre judgment intrest of $2,107,057.52

Allen Jacobson is liable for disgorgement in the amount of $4,462,073 and pre judgment interest of $855,920.94.

Each was also ordered to pay a $150,000.00 civil penalty within 15 days of the entry of the final judgment.

The Receivership continues and has filed a plan to sell the remaining assets, in a Stalking Horse Bid to a buyer at a price fixed based upon the valuations obtained by the recievership. A group, calling itself the MSI Investors Group, has filed objections to the plan, and with execption to the McDermott Family has requested the court allow it to control the remaining assets. The SEC receiver has filed objections to this request.