Use of 1870s Railroad Bonds Halted
The Securities and Exchange Commission has won a temporary court order halting an Orange County man and his company from passing off worthless railroad bonds as valid investments.
The federal order prohibits Gerald A. Dobbins and his Fidelity Secured Deposit Corp. in Huntington Beach from preparing and using documents that fraudulently authenticate and valuate bonds issued in 1870 and in 1873.
The bonds have historical value only and were sold by a Grand Rapids, Mich., museum for $22.95. But the SEC complaint contends that the bonds are worthless as investments.
The agency suit alleges that Fidelity Secured valued the bonds at $100 million to $400,000 million and, in a separate suit, alleges that a Wyoming man sold the bonds for up to $40,000.
The 1873 bonds were issued by the Chicago, Saginaw and Canada Railroad Co., and the 1870 bonds were issued by the East Alabama & Cincinnati Railroad.
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