(HedgeCo.Net) The Securities and Exchange Commission today charged a Bellevue, Washington company and its principal with defrauding investors by making false and misleading statements about a failing real estate investment project.

The SEC’s complaint alleges that, between September and December 2015, Kirk Sperry, by and through his family business, Sperry and Sons Capital Investments, LLC, fraudulently raised $125,000 from two investors in connection with a multi-million dollar residential project in Williston, North Dakota. According to the complaint, Kirk Sperry solicited the investments using a number of false and misleading statements. These included allegedly stating that the investment would be secured by a first position mortgage on the property when in fact a different investor and business partner held first position, and claiming that there were purchase agreements in place for certain lots, when those purchase agreements had been cancelled already. Further, the complaint alleges that Sperry and Sons, with Kirk Sperry’s knowledge and consent, used part of the funds received from the investors to make payments to other investors in unrelated Sperry and Sons project