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UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA - page 6 / 18

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19.

Since at least 1999, Pension Fund and later PFA Assurance have purportedly

affiliated themselves with several U.S. banks and broker-dealers in connection with the

investment component of their plans, including SunTrust Bank, Lehman Brothers, Merrill

Lynch, Raymond James Financial Services, and HSBC Bank USA. Pension Fund touts its

relationship with these financial institutions as one of the main selling points for its plans and

includes information about these companies in presentations and marketing materials to

prospective investors. The fact that the investment vehicle is a “trust” is important to investors

because it connotes that their money is safe and that a major financial institution backs their

investment.

  • B.

    Offering Materials

    • 20.

      The only documents describing the investment plans that potential investors

receive from the Defendants before purchasing the plans are brochures, available in Spanish and

Portuguese, generally describing the products, and an “Investor Application.”

21.

The brochures promote the two plans as “retirement trust plans” administered by

trustees at U.S. banks and broker-dealers. Current versions of the brochures contain HSBC’s

logo, pictures of HSBC’s corporate headquarters and corporate information, and statements such

as “Your money will be in the best of hands: HSBC Bank, USA.” The Liberty Trust offering

materials also tout the security of the investment plans.

22.

The Investor Application includes a list of eight mutual funds for the investor to

choose from. Previous versions of this document contained a section, complete with checkmark

boxes, for investors to select which financial institution they prefer to serve as trustee or

custodian of their investment. Investors who decide to invest in one of the plans complete and

6

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