The Commission stated the following: "The Division of Enforcement ("Division") alleges two separate schemes to violate the federal securities laws. In the first scheme, Freedom Track and FFG sold stock in two offerings in 2000 and 2001 to fund business plans involving the exploitation of financial record keeping software. The stock was offered through Freedom Financial. The two offerings materially overstated the usefulness and completeness of the software. The offerings also touted glowing projections for future growth and profitability of Freedom Financial and other businesses in Pierce's group, but misrepresented or failed to disclose material facts about the historical and current financial condition of those businesses. The first offering also failed to disclose that Freedom Financial faced significant business risk because it was operating in violation of the Commission's net capital and customer protection rules. Pierce also caused Freedom Financial to file false Forms BD and FOCUS reports with the Commission. These false filings helped conceal the net capital and customer protection violations because they created the false appearance that Freedom Financial was doing business as an introducing broker-dealer, when in fact it was a self-clearing broker-dealer. In the second scheme, which began in 1997 and continued until 2001, AIM offered an account management plan to clients called the "Insured Risk Management Program." According to advertising and disclosure documents, the program insured principal balances of AIM clients who agreed to keep their money in mutual funds under AIM management for at least five years. AIM told clients that the program was supported by an insurance policy, but failed to disclose that AIM was not complying with the terms of the policy and that it could be canceled through AIM's acts and omissions without any 4/3/2020 Freedom Financial, Inc.: Admin. Proc. Rel. No. 8280 / September 4, 2003 https://www.sec.gov/litigation/admin/33-8280.htm 2/2 fault of the client. That risk became realized in April 2001 when AIM's insurer canceled AIM's policy, alleging that AIM failed to comply with its terms. At that time, none of the AIM accounts had matured pursuant to the five-year holding period, but almost all clients in the program had suffered losses. After the insurance was canceled, AIM stopped signing up new clients for the program, but made misleading statements to encourage existing clients in the program to keep their accounts with AIM."