In the following press release officials in [Missouri] Secretary of State Robin Carnahan’s office today [announced that they had] issued a Cease and Desist Order against Morris A. Bird Sr. and M. Allen Bird Jr., for alleged securities fraud in a Southwest Missouri real estate investment scheme that cost investors in four states over $1.7 million.

According to the order, father and son team Morris and Allen Bird sold investors promissory notes and other investments by promoting annual returns of up to 54%. Morris Bird told investigators from the Missouri Securities Division that Chaparral I, LLC, a family operated company, took investors’ money and disbursed the funds as directed by his son Allen Bird. Over $800,000 of investor funds were disbursed among real estate ventures that the Bird family controlled or were affiliated with.

It is also thought that some early investors received interest payments from funds belonging to subsequent investors, a key feature of a traditional Ponzi scheme.

“In this case, it seems that empty promises may have cost investors hundreds of thousands of dollars,” said Carnahan. “This is a prime example of why Missourians should check out investments and the people offering them before they turn over their hard-earned money, especially during these trying economic times.”

According to the order, Chaparral has generated no income and has no ability to repay the promissory notes. Morris Bird also stated that some of the money invested with Chaparral went to other businesses that his family controlled, including Turnpoint International I, LLC, based in Springfield. Money was even used to fund home improvements for one of Allen Bird’s relatives.

It is also alleged that some investor money was sent to Greenleaf Companies, LLC, which was the subject of a different Securities Division Cease and Desist Order on December 16, 2008. On June 18, 2009, Greenleaf withdrew its request for a hearing on the facts in its case and is now facing civil penalties and other additional charges.

Morris and Allen Bird are charged with not being properly registered with the Securities Division and failing to disclose risks and other important information about the investments. Additionally, they were accused of not properly registering their investment offerings. The Birds and their company, Chaparral, LLC, have thirty days to respond to the order and request a hearing.

For more information regarding investments and fraud protection, or for information regarding a company or representative, visit the Secretary of State’s online Missouri Investor Protection center at www.MissouriSafeSavings.com or call the toll free Investor Protection Hotline at 1-800-721-1996.