Posted: Apr 4, 2013 12:42 PM by Micah Smith
Updated: Apr 4, 2013 11:08 PM
JEFFERSON CITY - Missouri Secretary of State Jason Kander issued a cease and desist order Thursday against Morgan Keegan & Co., Inc. for its involvement in the botched Mamtek investment in Moberly. The order alleges that Morgan Keegan did not adequately inform investors of the risks involved in purchasing bonds for the Mamtek sweetener factory in Moberly. Kander said this cost Missouri investors more then $6.5 million.
The cease and desist order stops Morgan Keegan from leaving out important facts when selling bonds to investors and requires the company to thoroughly investigate bond offerings.
A news release from the Missouri Secretary of State's Office alleged that Morgan Keegan misrepresented claim that there was an operating facility in China. But upon investigation, the state government was unable to prove that the facility existed.
Kander stated Morgan Keegan told investors that its bonds were backed by Mamtek's patents, but Mamtek does not have any patents. Kander also stated Morgan Keegan falsely claimed that Moberly would pay back investors bonds if Mamtek failed.
Kander said other states where Morgan Keegan operates are starting to investigate the companies bond sales in Moberly.