I try and keep this blog focused on fraud committed against the Government. But yesterday I presented to the San Antonio chapter of the Construction Financial Management Association and encountered some skepticism about the merits of whistleblowing. Too many people think that the leaders in our community can always be trusted. And too many people think that Government agencies, such as the SEC, are vigilant in protecting investors. It's been my experience that whistleblowers are the most effective tool to protect our free enterprise system.
One of the highest paid and respected employees of the State of Texas, Coach Tommy Tuberville, (and yes he is a public employee) has been sued for fraud, in particular, violations of the Securities Exchange Act. Whether its true or not is for a judge and jury to decide. At this stage, we have assume Coach Tuberville did not commit the acts alleged in the lawsuit and I hope he actually did not.
While the investors in the case have recourse in federal court, ever since Madoff, you have to wonder whether the SEC is up to the task of protecting investors. But it looks like the National Futures Association has taken action (see below).
From the Huntsville Times:
Tommy Tuberville has been listed in a federal suit that alleges the former Auburn coach and his partner defrauded investors out of more than $1.7 million. The complaint, filed Friday afternoon in the in U.S. District Court in Montgomery, claims Tuberville and TS Capital co-founder John David Stroud "employed devices, schemes, and artifices" to commit fraud. Seven plaintiffs from Alabama and Tennessee are seeking damages against the Auburn-based investment company.
Here is the lawsuit: