SEC Charges Robert Hurd and His Company in Investment Scheme Touting Alzheimer’s Treatment

SEC v. Robert Hurd, Your Best Memories International Inc. and Kenneth Gross, Case No. 13-CV-04464-RGK (JCGx) (C.D. Cal.).  On June 21, 2013, the SEC announced it filed charges against Your Best Memories International Inc. and its president, Robert Hurd for fraud.  The SEC also charged Kenneth Gross for selling Your Best Memories stock without being registered as a broker-dealer.  The SEC alleges that Your Best Memories claimed to be raising money from investors on behalf of Moving Pictures, Inc., which was developing products intended to improve memory in individuals suffering from Alzheimer’s disease, dementia or memory loss.  According to the SEC, Your Best Memories raised about $1.2 million and failed to register the offering with the SEC.  The SEC alleges that Hurd and Your Best Memories told investors that most of their money would be used to support the development and marketing of Moving Pictures’ memory enhancing products.  In reality, less than 20% of the money raised was given to Moving Pictures.  Rather, Hurd took a substantial amount of money for himself.  According to the SEC, Hurd and Your Best Memories also defrauded investors by using money from newer investors to pay older investors in a Ponzi-like scheme.  Lastly, Hurd and Your Best Memories allegedly lied to investors by stating that they had secured FDA approval to sell coconut oil as a treatment for Alzheimer’s disease, when in reality, there was no such FDA approval.  The SEC charged Hurd and Your Best Memories with violating Sections 5(a) and (c) and 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Exchange Act Rule 10b-5.  Hurd is also charged with aiding and abetting Your Best Memories’ violations of Section 17(a)(2) of the Securities Act as well as with control person liability under Section 20(a) of the Exchange Act.  The complaint also charges Gross with violations of Sections 5(a) and (c) of
the Securities Act and Section 15(a) of the Exchange Act.  The SEC seeks injunctive relief, disgorgement and civil monetary penalties.

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