A Seattle guidance counselor has been fined twice by state regulators for selling stocks without a broker’s license and misleading investors. But he continues to advise students at Garfield High School.
A guidance counselor in Seattle Public Schools has twice been fined by state regulators for selling stocks without a broker’s license. But violating the Securities Act of Washington — and misleading investors — does not disqualify Raymond Willis from continuing to advise students at Garfield High School, where he has worked since 2007.
As of last fall, the state Department of Financial Institutions had fined Willis and his nutritional-supplement company, the MiniHYA Corp., $37,000 in penalties and associated legal costs for fraudulently selling securities.
Willis, reached by phone last month at a Miami Beach hotel, would not discuss the matter.
“That’s all been resolved,” he said, before hanging up.
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Not to the satisfaction of regulators in Olympia, who say Willis failed to show up at his most recent hearing and has not paid the fines.
Michael Galletch, a lawyer representing Willis, said the guidance counselor and his company will make good. The dollar amounts collected from outside investors were very small, Galletch added, each about $1,000.
“Whatever issues they’ve got, they’ve corrected,” Galletch said. “And as they go forward, they will comply. They are not taking any more money in.”
Violating state finance laws does not necessarily bar Willis from holding onto a job providing guidance in schools, according to Nate Olson, a spokesman for the Office of Superintendent of Public Instruction.
“There are specific offenses that would trigger suspension and generate an investigation,” Olson said. “Fraud is not on that list.”
Short of violence or sexual crimes against a child — which can automatically trigger action by the state — it is up to school districts to file complaints. And so far, Seattle has taken no such action against Willis.
“Mr. Willis is currently employed by Seattle Public Schools. We are aware of the situation and are looking into it and will follow state law,” said a district spokesman in an emailed statement.
Neither the Washington Education Association nor the Seattle teachers union would comment on Willis’ legal situation or whether they support the fact that he continues to guide young people.
In 2014, state documents say, Willis raised more than $40,000 from several dozen investors in MiniHYA, which he said would soon market an anti-wrinkle product. It had been patented, approved by the Food and Drug Administration and subjected to “extensive ‘research clinical studies,’ ” the documents quote Willis as saying.
But few of those things were true, investigators said.
“A search of filings with the United States Patent Office does not reveal that MiniHYA Corporation or Raymond Willis have any patent applications pending or that they hold any patents,” they wrote in a statement of charges dated December 2015.
Meanwhile, Willis continued to portray himself as a successful entrepreneur. Last summer, he contacted Florida real-estate agent Chris Rey, who says Willis told him he owned three large pharmaceutical companies and wanted to purchase two luxury properties for his investors — each valued at about $50 million.
“That’s a life-changing commission for me,” said Rey, who works at The Nickley Group in Orlando.
Rey got to work. But his suspicions were quickly piqued.
“He said his investors were part of the royal family of Abu Dhabi! It was this tall tale that just seemed extremely bizarre,” recalled Rey in an interview.
He began searching online for information about Willis, and the legal proceedings from the Department of Financial Institutions popped up, as did Willis’ day job as a guidance counselor at Garfield.
“It floored me — big-time,” Rey said.
Willis has a checkered history in Seattle schools. He was fired from his coaching job at Chief Sealth High in 2005 for improperly recruiting athletes for the girls basketball team. Two years later, the district reassigned him to work as a counselor at Garfield, saying only that the loss of his coaching job didn’t affect his status as a counselor.
There, Willis, who is African American, has worked primarily with black students. There is no evidence that Willis approached students or their families about his businesses.
According to Department of Financial Institutions documents, Willis told would-be investors that by 2018 MiniHYA would be worth $160 million, and a $2,000 investment could net them up to $40,000. They also said he solicited blacks, in particular, as investors, contacting them through an online chat room aimed at African Americans.
One woman earned a salary barely above the minimum wage and had used money from her retirement account to buy into MiniHYA, hoping it would help her “earn enough money from the investment to live independently,” investigators wrote.
It was not the first time Willis has been in trouble with financial regulators.
Documents show that in 2013, after an investor sued him, alleging fraud, Willis agreed to stop selling stock in two other companies — a skin-care firm called AuJeune, and a health-care company called Ra Ghala that was marketing a mammogram machine, a bandage and “a device to pick up pet waste.”
He’d solicited more than $250,000 from 40 investors to fund those two enterprises, according to state regulators, who fined Willis $4,000 for violating securities law, an amount determined based on Willis’ ability to pay, not the gravity of the charges, said Suzanne Sarason, chief of securities enforcement with DFI.
Willis, who earns about $70,000 through his guidance-counselor job, paid the penalty and agreed to stop selling stock.
But it did not stop him from advertising himself as a CEO, trusted board chairman and respected health-care industry official — all titles that appear on the CV Willis submitted to real-estate agent Rey.
That paperwork makes no mention of his job with Seattle Public Schools.
“Mr. Willis’s work as a guidance counselor is community effort,” said Galletch, the lawyer. “He doesn’t do it as a regular source of income. He does it to help young people.”