SEC Obtains Partial Consent Judgments Against Legacy Cares Defendants

SEC Litigation Releases

Filed March 9th, 2026

Detected March 10th, 2026

Summary

The SEC announced partial consent judgments against defendants in a municipal bond offering fraud case. The judgments enjoin the defendants from future securities law violations. This action stems from an alleged scheme involving fabricated documents to inflate revenue projections for a sports complex, leading to bond defaults.

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What changed

The Securities and Exchange Commission (SEC) has secured partial consent judgments against Jeffrey Puzzullo, Randall J. Miller, Chad J. Miller, and Jeffrey De Laveaga in connection with an alleged municipal bond offering fraud. The judgments, entered by the U.S. District Court for the Southern District of New York, permanently enjoin the defendants from violating federal securities laws and participating in the issuance or sale of securities, except for personal accounts. These actions are part of the SEC's ongoing litigation concerning approximately $284 million in municipal bonds issued by Legacy Cares, a nonprofit company, which allegedly defaulted due to fabricated contracts and misleading revenue projections for a sports complex.

Regulated entities, particularly those involved in municipal finance or investment offerings, should review the details of this case to understand the SEC's enforcement approach to alleged misrepresentations and fraud in bond offerings. While disgorgement, prejudgment interest, and civil penalties are to be determined, the defendants have also faced significant consequences in parallel criminal proceedings, including prison sentences and substantial forfeiture orders. The SEC's complaints charged violations of the Securities Act of 1933 and the Securities Exchange Act of 1934. The defendants' consent to these judgments indicates their agreement to be permanently barred from certain securities activities.

What to do next

Review SEC Litigation Release No. 26498 for details on alleged fraud in municipal bond offerings.
Assess internal controls and disclosure practices related to investment offerings, particularly those involving municipal bonds.
Consult legal counsel regarding potential implications for ongoing or future securities offerings.

Penalties

Disgorgement, prejudgment interest, and civil penalties to be determined by the court. In parallel criminal proceedings, defendants received prison sentences, supervised release, and forfeiture orders totaling over $12 million. Restitution ordered for $228,260,356.19.

Source document (simplified)

Randall J. Miller; Chad J. Miller; Jeffrey De Laveaga; Jeffrey Puzzullo

U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 26498 / March 9, 2026

Securities and Exchange Commission v. Jeffrey Puzzullo, No. 1:26-cv-01738 (S.D.N.Y. filed Mar. 3, 2026)

Securities and Exchange Commission v. Randall J. Miller, Chad J. Miller, and Jeffrey De Laveaga, No. 1:25-cv-02702 (S.D.N.Y. filed Apr. 1, 2025)

SEC Obtains Partial Consent Judgments Against Legacy Cares Defendants

The Securities and Exchange Commission today announced that, on March 5, 2026, the U.S. District Court for the Southern District of New York entered a partial judgment by consent against Jeffrey Puzzullo, in an alleged municipal bond offering fraud. Additionally, the Court entered partial judgments by consent against Randall (“Randy”) J. Miller, Chad J. Miller, and Jeffrey De Laveaga on July 16, 2025, in connection with previously filed fraud charges.

According to the SEC’s complaints, in August 2020 and June 2021, Randy Miller’s nonprofit company, Legacy Cares, issued approximately $284 million in municipal bonds through an Arizona state entity to finance the construction of a multi-sports park and family entertainment center in Mesa, Arizona. Limited offering memoranda for the 2020 and 2021 offerings indicated that investors were to be paid from revenue generated by the sports complex, and included revenue projections that were multiple times the amount needed to cover payments to investors, according to the complaints. The complaints allege, however, that the defendants fabricated or materially altered documents, including letters of intent and pre-contracts with sports clubs, leagues, and other entities to use the sports complex, forming the basis for those revenue projections. As alleged, the sports complex opened in January 2022 with far fewer events and much lower attendance than expected under the offering memoranda’s false projections, and the bonds defaulted in October 2022.

The SEC’s complaints charged Randy Miller, Chad Miller, De Laveaga, and Puzzullo with violating Section 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. All four defendants agreed to bifurcated settlements, including judgments that permanently enjoin them from violating the charged provisions of the federal securities laws and from directly or indirectly participating in the issuance, purchase, offer, or sale of any security except for purchases or sales for their own personal accounts. Under the terms of the bifurcated settlements, disgorgement, prejudgment interest, and civil penalties will be determined by the court upon motion by the Commission.

In a parallel criminal proceeding, United States v. Randy Miller and Chad Miller, 25 Cr. 138 (S.D.N.Y. filed Mar. 31, 2025), Randy Miller and Chad Miller pleaded guilty and were sentenced on September 9, 2025 to six and five years in prison, respectively, for securities fraud and aggravated identity theft. In addition to their prison terms, Randy Miller and Chad Miller were sentenced to three years of supervised release, and ordered to forfeit $7,289,134.89 and $4,798,980.19, respectively. On February 2, 2026, Randy Miller and Chad Miller were ordered to pay restitution, on a joint and several basis with each other and with Puzzullo and De Laveaga, of $228,260,356.19. De Laveaga and Puzzullo have each also pleaded guilty in separate parallel criminal proceedings— United States v. Jeffrey De Laveaga, 25 Cr. 127 (S.D.N.Y. filed Mar. 25, 2025), and United States v. Jeffrey Puzzullo, 25 Cr. 188 (S.D.N.Y. filed Apr. 24, 2025). On January 28, 2026, Puzzullo was sentenced to time served and one year of supervised release, with restitution to be determined by the Court. De Laveaga is awaiting sentencing.

The SEC’s litigation is being led by Jonathan Grant and William Salzmann of the Enforcement Division’s Public Finance Abuse Unit under the supervision of Jason Bussey of the SEC’s San Francisco Regional Office. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York and the Federal Bureau of Investigation.