Thomas Renison and Timothy Allcott

On March 15, 2018, the Massachusetts Securities Division released an Administrative Complaint against ARO Equity, LLC, Thomas Renison, and Timothy Allcott for violating the Massachusetts Uniform Securities Act. Thomas Renison is currently a resident of South Glastonbury, Connecticut and Timothy Allcott is a resident of Peabody, Massachusetts.

According to the Complaint, the SEC issued an order in 2014 permanently barring Renison from the securities industry after years of litigation concerning his role in a 2008 scheme in which he made untrue statements of material fact in connection with the $600,000 sale of an unsecured promissory note to a 75-year old client. Through a civil trial, it was concluded that Renison violated the Maine Uniform Securities Act and was liable for a $1.4 million restitution award. In October 2015, Renison filed for Chapter 7 bankruptcy and sought to discharge his debt under the Maine restitution order.

About a year after the SEC issued a permanent bar, Renison helped to establish a purported private equity fund—ARO Equity—that primarily operated out of a trailer park in Peabody, Massachusetts. Timothy Allcott was the disclosed manager of ARO Equity, which described itself as a “private investment fund” and claimed to invest in various business ventures in Massachusetts and throughout New England.

The SEC alleges that starting in August 2015, Renison solicited and exploited the trust of his former investment advisory and insurance clients to raise $5.8 million. Many customers were in their eighties and had transferred qualified retirement assets to a self-directed IRA for the purpose of investing in ARO Equity. The SEC claims that Renison and Allcott made material misstatements or omissions of material fact while offering and selling these securities to investors and failed to inform the investors about Renison’s criminal and disciplinary history.

According to the Order, ARO Equity customers who “invested” in just two Massachusetts companies lost over $1.6 million, while Renison and Allcott awarded themselves over $1 million of investor capital contributed to the fund. The SEC asserts that Renison alone claimed $710,000 in undisclosed commissions and executive compensation and attempted to hide the compensation by wiring funds to bank accounts seemingly controlled by his immediate family members.

Finally, FINRA claims that Renison and Allcott were operating ARO Equity as a Ponzi scheme by providing monthly returns to investors with funds raised from new investors. Currently, $700,000 has been returned to ARO Equity investors in this manner.