Woodinville businessman faces U.S. fraud charges

Federal securities regulators on Wednesday filed fraud charges against Woodinville businessman Joseph Lavin and his firm, Global Asset Partners, saying he misappropriated funds and lied to investors about where he invested and how much they earned.

The Securities and Exchange Commission and the Commodity Futures Trading Commission, in separate complaints filed in U.S. District Court in Seattle, said Lavin, 41, raised some $22 million from more than 100 investors between January 2001 and November 2006.

According to the complaints, Lavin initially told investors he would invest in foreign-exchange options, other currency instruments and asset-backed securities. He allegedly promised returns exceeding 30 percent per year.

But after early investments in the currency markets went bad, the agencies claim, Lavin began investing in various Texas real-estate projects and microcap stocks without telling his clients about the switch.

Even though those other investments didn't pan out either, the agencies claim, Lavin continued to send clients statements showing regular growth in their accounts.

The SEC also charged that Lavin took $895,000 for his own use — spending the money on cars, a skybox at Safeco Field and real estate in Costa Rica, among other things. Lavin also used some funds from new investors to repay earlier investors, the SEC alleged.

Lavin's attorney, David Nold of Bellevue, said his client had been cooperating with the SEC and the U.S. Attorney's Office in Seattle.

"He realizes that mistakes were made, and he's trying to do the right thing," Nold said.

The two suits seek repayment of the funds, penalties and permanent injunctions against violating federal securities laws.

Drew DeSilver: 206-464-3145 or ddesilver@seattletimes.com