After just over two years of vowing to clear his name and prove Traffic Monsoon wasn’t a Ponzi scheme, Charles Scoville has entered into settlement negotiations with the SEC.
The latest Traffic Monsoon developments begin with a July 23rd filing, in which Scoville requests $171,861 in seized Ponzi victim funds to cover his legal costs.
In the filing, Scoville’s attorneys argued the request was “not only necessary … (but also) reasonable”.
Mr. Scoville’s health problems have precluded him from raising funds for his own support, much less to fund a sophisticated opposition and appeal.
As the Court is now aware, Mr. Scoville has had numerous issues making it difficult, if not impossible, for him to work to raise funds to defend against this case.
Specifically, given the health issues previously documented, and his multiple hospitalizations, Mr. Scoville was unable to be employed for most of the past year.
Then, approximately one month ago, Mr. Scoville was arrested on unrelated charges brought by the State of Utah.
As a result, he is unable to earn funds to pay his attorney fees.
Because of these recent developments the plans that had existed to eventually pay Mr. Scoville’s fees have had to change and it is likely the attorneys who prepared the appeal will never be paid without an order from this Court.
The “unrelated charges” referenced in the motion refer to aggravated child sexual abuse.
On August 2nd, at which point Scoville’s motion was still undecided, a Joint Motion was filed requesting a stay on the carve-out motion.
The cited reason for the motion is
settlement negotiations that Mr. Scoville anticipates will include a resolution of his Motion as part of a resolution of all claims against him in this matter.
Note however that the motion also states
the settlement negotiations that have begun will be resolved only after the Tenth Circuit has entered a decision in the appeal.
As at the time of publication, the Tenth Circuit is yet to make a decision regarding Scoville’s filed appeal.
Bearing in mind a decision in Scoville’s favor would be a step towards legalizing unregistered securities in the US, it seems both parties are now anticipating the appeal will be denied.
The requested stay would see neither Scoville, the SEC or the Receiver have to brief or file anything with respect to the carve-out motion, until the appeal is decided on.
The Joint Motion was granted the same day it was filed, on August 2nd.