A Mayflower man with a history of problems with state regulators is the subject of a cease-and-desist order issued Thursday by Arkansas Securities Commissioner Edmond Waters.
According to the order, Timothy Alonza Lilly, a former insurance agent, in 2011 offered an unidentified Arkansas resident a return of 20 percent over two years on an investment of $59,500 with Lilly’s company, BLW Debt Resolution LLC. In more than three years since, the investor has received back less than $25,000.
Lilly, in an interview with Arkansas Business, disputed the Securities Department’s description of the deal. It was, he said, a joint venture in which BLW and the investor bought a portfolio of debt with the understanding that the investor would receive 20 percent of the profit.
The book of business was sold two years ago, Lilly said, but BLW hasn’t received payment and is therefore unable to pay the investor.
“We’re in the same boat he is,” Lilly said. “We’re waiting for our money.”
Neither Lilly nor BLW has ever been registered to sell securities in Arkansas, and the investment that Lilly sold to the client was neither registered nor exempt from registration, according to Waters, who ordered Lilly not to sell anymore securities in Arkansas.
“We weren’t aware that it was an unregistered security,” Lilly said.
The investigation into Lilly’s activities is ongoing, according to the order. Lilly said BLW no longer exists, other than to try to get payment for the debt it sold and to repay the investor. Lilly said BLW didn’t have similar agreements with anyone else.
Lilly was a licensed insurance agent until his license was revoked by the Arkansas Insurance Department in 2009. That revocation followed two cease-and-desist orders against Lilly by the Securities Department in 2008, one as owner of First Fidelity Financial Group of Maumelle LLC and the other doing business as Covenant Senior Advisors LLC.
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