What happens when the SEC accuses one of the biggest self-directed IRA custodians in America of helping to promote a Ponzi scheme… a scheme which wiped out many MILLIONS of dollars from the accounts of that custodian’s clients?  I’m Bryan Ellis… I’ll give you the latest RIGHT NOW in Episode #86.---------------It’s an ugly, ugly situation, my friends.  And I hope you’re not one of the many unfortunate investors who were victimized.Before I give you all of the sordid details, it’s important that you understand that everything I’m about to share with you is allegation on the part of the SEC.  This has not yet gone to court, though it’s heading there presently.  It’s entirely possible that the huge Self-Directed IRA custodian involved in this situation could be fully exonerated.  They have denied the charges.But I’ve got to tell you… it doesn’t look good for Equity Trust, one of the largest – if not the very largest – self directed IRA custodian.I’ll give you the ugly details about that in just a moment.  But first, I’d like to give a heart-felt thank you to:  EVERY ONE OF YOU.  I just love doing this show… I love that you listen to this show… and I’m truly, truly grateful for you.So, back to our story:Here’s my reading of the situation from a layman’s point of view.  Equity Trust is in trouble because the SEC believes that they, in effect, helped to promote an investment that turned out to be a fraudulent Ponzi scheme… and they did nothing to alert their clients, even though there were some very clear red flags.  That Ponzi scheme – promoted by Ephren Taylor and Randy Poulson – resulted in the loss of a total of about $5 million dollars across about 100 accounts at Equity Trust.Why were so many Equity Trust clients involved in this particular scheme – which they all believed to be a legitimate investment?  Apparently, Equity Trust representatives participated at events hosted by Taylor and Poulson, where the custodian encouraged attendees to transfer their retirement savings from traditional IRAs to self-directed IRAs at Equity Trust so they could invest in the Taylor or Poulson offerings.But the real crux of the matter, according to the SEC’s allegation, is that there were some red flags that should have tipped off Equity Trust to the potentially fraudulent nature of the transaction.  And apparently, those red flags were ignored by Equity Trust.What were the red flags?  Well, possibly the biggest one was that even though Taylor and Poulsen were providing investments in the form of “notes” – basically just a loan – those guys apparently never provided investors with documentation about the collateral for those notes.  And this is a problem for Equity Trust, as the entity who seems to have both PROMOTED the investment and served as a custodian for accounts that purchased the investment.  What does the SEC think about that?  Well, Andrew J. Ceresney, Director of the SEC’s Division of Enforcement says it rather bluntly:“We allege that Equity Trust failed to protect the interests of its customers when it acted as more than a passive custodian.  When custodians like Equity Trust are aware of red flags suggesting an ongoing fraud, they must take action to try to prevent it.”So, the issue here is NOT that clients of Equity Trust were involved in an investment which turned out to be fraudulent.  After all, they sell self-directed accounts, which inherently includes the ability to self-direct into bad investments as well as good ones.  No, my friends, the problem is more fundamental:  The SEC thinks that Equity Trust, in effect, recommended the investment, and stepped out of the role they’re supposed to serve – which is as a passive custodian of assets – and into a role which is not compatible, and apparently legal problematic, for a custodian to be involved in… that role being investment advisory.  And since that investment showed some red flags of fraud, and later turned out to be genuine fraud… the SEC thinks Equity Trust’s role beyond