SEC Alleges Texas Attorney Used Tax-Lien and Settlement Investment Deals to Raise $1.85 Million
The U.S. Securities and Exchange Commission has charged Texas attorney David T. Gilchrist and Texas-based podcast host Christopher Aaron Novinger in connection with multiple alleged fraudulent securities offerings.
According to the SEC, Gilchrist raised more than $1.85 million from at least 22 investors through four securities offerings between 2021 and 2025.
The Commission alleges that investors were presented with different investment strategies, including tax-lien purchases and funding connected with class-action settlement payments.
The SEC filed the case in the U.S. District Court for the Northern District of Texas.
Four Separate Securities Offerings
According to the SEC's complaint, Gilchrist conducted four alleged fraudulent securities offerings.
The Commission says the offerings operated from at least March 2021 through October 2025.
Across those offerings, more than:
$1.85 million
was allegedly raised from at least:
22 investors
The structure is notable because the alleged investment pitches were not all the same.
Different investors were allegedly given different explanations for how their money would be used.
One Investor Was Told Money Would Fund Class-Action Settlement Payments
According to the SEC, one investor was told that their money would be used to advance settlement payments to plaintiffs involved in class-action litigation.
Litigation-finance and settlement-funding strategies can be legitimate businesses.
However, investors should verify:
- The underlying cases
- Settlement status
- Expected payment dates
- Contractual rights
- Counterparties
- Custody of investor funds
- How returns are calculated
If the underlying settlement arrangements cannot be independently verified, the investment risk may be significantly higher.
Other Investors Were Told Their Money Would Buy Tax Liens
The SEC alleges that other investors were told their funds would be used to purchase tax liens on properties with delinquent taxes.
Tax-lien investing is a real investment strategy.
Local governments can place liens on properties when property taxes remain unpaid.
Investors may purchase those liens and potentially receive:
- Interest payments
- Penalty income
- Repayment when the property owner clears the debt
- In certain cases, foreclosure-related rights
However, the SEC alleges that the investor money in this case was not used as represented.
SEC Alleges Investor Money Was Misappropriated
According to the Commission, Gilchrist instead misappropriated investor funds for his own purposes.
The SEC also alleges that some investor money was used to make Ponzi-like payments to other investors.
This creates a critical distinction between:
- Investment-generated returns
- and
- Payments sourced from other investors' capital
Regular payments alone do not prove that an investment strategy is generating genuine profits.
Why Tax-Lien Investments Require Independent Verification
Tax liens can often be verified through public records.
Investors considering a tax-lien strategy may be able to confirm:
- Property address
- County records
- Tax delinquency
- Lien amount
- Lien ownership
- Auction records
- Redemption status
- Property valuation
This means a manager claiming to operate a tax-lien portfolio should generally be able to provide evidence of the underlying assets.
Podcast Host Was Also Charged
The SEC's case also names Christopher Aaron Novinger.
According to the complaint, Novinger solicited investors for two of Gilchrist's offerings.
The Commission alleges that in one offering, Novinger helped facilitate the transfer of investor money to Gilchrist.
The SEC further alleges that Novinger told two investors that he had personally invested in the offering.
According to the Commission, that representation was false.
Personal Investment Claims Can Influence Investor Trust
When a promoter tells investors that he has invested his own money into the same opportunity, it can create a strong impression of confidence.
Investors may assume:
- The promoter conducted due diligence
- The promoter shares the same financial risk
- The promoter believes the investment is legitimate
This is why claims involving personal investment participation should be verified when they materially influence an investment decision.
SEC Says Novinger Was Already Subject to a Prior Bar
The SEC also alleges that Novinger's conduct violated a 2016 SEC order that barred him from associating with a broker.
This adds a regulatory-history dimension to the case.
An investor evaluating a promoter should not only review the current business.
It can also be important to examine:
- Prior SEC orders
- FINRA records
- CRD history
- State securities actions
- Civil litigation
- Bankruptcy history
- Previous business entities
Regulatory History Can Be Material
A prior regulatory action does not automatically prove that a new investment is fraudulent.
However, it can materially change the level of due diligence required.
Investors should ask:
Was the individual previously barred
Was the bar temporary or permanent
What conduct led to the prior action
Is the person legally permitted to perform the activity they are currently performing
Are current activities consistent with prior restrictions
SEC Charges Federal Antifraud Violations
The SEC's complaint charges Gilchrist and Novinger with alleged violations of federal securities antifraud provisions.
These include:
- Section 17(a) of the Securities Act of 1933
- Section 10(b) of the Securities Exchange Act of 1934
- Rule 10b-5
The SEC also charged Novinger with additional alleged Exchange Act violations connected with broker activity.
The complaint further alleges that Novinger aided and abetted some of Gilchrist's alleged violations.
Rebecca Novinger Named as Relief Defendant
The SEC named Novinger's wife, Rebecca Novinger, as a relief defendant.
A relief defendant is generally a person or entity that is not accused of the primary securities-law misconduct but is alleged to possess proceeds connected with the conduct.
The SEC is seeking disgorgement of alleged ill-gotten gains received by Rebecca Novinger, together with prejudgment interest.
Parallel Criminal Case Against Gilchrist
The U.S. Attorney's Office for the Northern District of Texas also filed criminal charges against Gilchrist.
Parallel SEC and criminal proceedings can arise from the same underlying conduct.
However, they are separate legal actions.
The SEC civil case can seek remedies such as:
- Injunctions
- Disgorgement
- Prejudgment interest
- Civil penalties
A criminal case can involve different potential consequences.
Attorneys Are Not Automatically Investment Professionals
Another important lesson from this case is that professional credentials should not replace investment due diligence.
An attorney may have expertise in law.
That does not necessarily mean the person is:
- A registered investment adviser
- A registered broker
- A licensed securities professional
- Authorized to sell securities
- Experienced in portfolio management
Investors should verify regulatory status independently.
Promoters and Solicitors Should Also Be Checked
Investors often focus only on the individual or company receiving the money.
That can be a mistake.
People who introduce or promote an investment may also play an important role.
Before relying on a promoter, investors may want to investigate:
- CRD history
- SEC IAPD records
- Prior disciplinary actions
- Broker registrations
- Compensation arrangements
- Relationship with the issuer
- Whether the promoter invested personally
Multiple Investment Stories Can Be a Warning Sign
The SEC alleges that different investors were told their money would support different strategies.
This does not automatically prove wrongdoing.
Businesses can operate multiple strategies.
However, where an offering involves substantially different explanations for the use of investor money, investors should ask for clear documentation.
Useful records can include:
- Offering memoranda
- Subscription agreements
- Use-of-proceeds disclosures
- Bank statements
- Asset schedules
- Transaction records
Follow the Money
For private investments, one of the most useful due-diligence questions is simple:
Where does the money actually go
Investors should understand whether funds are transferred to:
- A segregated fund account
- An operating company
- An escrow account
- A qualified custodian
- A personal account
- A related company
The more layers between the investor and the underlying asset, the more important independent verification becomes.
SEC Verify Independent View
The Gilchrist case is valuable from a due-diligence perspective because the alleged fraud involved investment concepts that can sound legitimate.
Tax liens are real.
Settlement funding is real.
Professional legal services are real.
Podcast-based financial education is also real.
The existence of a legitimate underlying concept does not establish that a particular offering is legitimate.
The key question is whether the actual use of investor funds matches the investment story.
Google and Research Relevance
This case also illustrates why regulatory research should connect SEC enforcement records with broader investor-education topics.
Relevant areas include:
- Tax lien investment fraud
- Class-action settlement investing
- Attorney investment schemes
- Broker solicitation rules
- SEC disciplinary history
- Ponzi-like investor payments
- Private offering due diligence
- Promoter verification
These topics provide useful context beyond the original enforcement announcement.
Warning Signs Investors Can Review
Potential warning indicators include:
- Investment proceeds sent directly to an individual
- No independent custody
- No verifiable underlying assets
- Different investors receiving different use-of-proceeds explanations
- Promoters with prior regulatory bars
- Unverifiable personal investment claims
- Returns funded by new investor capital
- Limited independent documentation
- Professional credentials being used as a substitute for securities registration
These indicators do not independently prove fraud.
But multiple issues should lead to deeper verification.
Final Assessment
The SEC's case against David T. Gilchrist and Christopher Aaron Novinger concerns four alleged fraudulent securities offerings conducted between 2021 and 2025.
According to the Commission, Gilchrist raised more than $1.85 million from at least 22 investors.
Some investors were allegedly told that funds would be used for tax-lien investments, while another was told money would support class-action settlement payments.
The SEC alleges that investor funds were instead misappropriated and used in part for Ponzi-like payments.
The Commission also alleges that Novinger solicited investors, made false claims about his own investment participation and acted despite a prior SEC broker-association bar.
The case remains pending, and the allegations have not been established as final findings.
For investors, the broader lesson is that a legitimate-sounding investment strategy should always be matched against independent evidence showing where investor money was actually deployed.
Official SEC and federal court records remain authoritative.
This article is provided for independent research and informational purposes only and does not constitute legal, financial or investment advice.