PHOENIX – The Arizona Corporation Commission held its monthly Open Meeting on March 15th and 16th, 2022 to discuss and vote on various utilities, safety, and securities items. Below are highlights from the meeting:
Commission Moves to Create Water Task Force
The Commission approved the creation of a Water Task Force consisting of various utility companies and stakeholders to examine and make recommendations on future water-related decisions within the purview of the Corporation Commission.
The Water Task Force will consist of the following members, serving as members of various subcommittees: Arizona Public Service Company, Arizona Water Company, Central States Water Resources, EPCOR, Global Water Resources, Inc., Greenstone, JW Water/Pivotal, Liberty Utilities, Lincus, Melodee Loyer, NextEra Water, the Residential Utility Consumer Office, Southwestern Utility Management, Tucson Electric Power Company, UNS Electric, Inc., the Water Infrastructure Finance Authority, the Water Utilities Association of Arizona, and Commission Staff. Additional parties will be contacted directly to determine if they wish to participate, including Grand Canyon State Electric Cooperative Association, Tierra Water Management, and a minimum of two non-profit/non-governmental organizations with expertise in water conservation, as part of an amendment from Commissioner Sandra D. Kennedy.
The Water Task Force will have the following subcommittees: Water Use, to include issues of water loss, supply, conservation, and long-term planning; Infrastructure, to include the issues of long-term planning, and resilient and reliable infrastructure; Water-Energy Nexus; and, Water Policies, to recommend specific updates to the Commission’s water policies approved in Decision Nos. 75626, 75743, and 78384 within the context of Demand-Side Management, rate design, and regulatory climate.
All documents related to this agenda item can be found in the Corporation Commission’s online docket at https://edocket.azcc.gov and entering docket number W-99999A-21-0313.
Commission Approves Grade Crossing Improvements Along Grand Avenue in Phoenix
The Commission voted to approve an application from the Arizona Department of Transportation (ADOT) to modify two existing crossings of the Burlington Northern Santa Fe Railway (BNSF) at 27th Avenue and Thomas Road west of Grand Avenue in Phoenix. Several crossings along Grand Avenue in Phoenix are among the most dangerous grade crossings in the nation according to a 2016 report from the Federal Railroad Administration.
The project will consist of installing new cantilevers, new gates, and flashing lights. Additionally, construction of new raised center medians, sidewalks, ramps, curbs, signage, and striping will also be part of the project. The street will be widened to accommodate those modifications. Completion of this project will ensure greater public safety for drivers and pedestrians.
All documents related to this agenda item can be found in the Corporation Commission’s online docket at https://edocket.azcc.gov and entering docket number RR-02635B-21-0317.
Commission Sanctions Promoters of “Secret” Fraudulent Investment Scheme
The Corporation Commission ordered multiple respondents from Arizona to pay restitution and penalties for defrauding investors with a clandestine prime bank investment scheme.
In its default order, the Corporation Commission ordered D2D Financial, LLC, Rone Dolph of Scottsdale and Susan Jean Arcadia of Surprise to pay restitution in the amount of $100,000. Respondents D2D Financial, LLC and Rone Milton Dolph are required to pay a $30,000 administrative penalty and Susan Arcadia, Anthony “Tony” Bellassai of Scottsdale and Super Commercial Loans, LLC are required to each pay a $15,000 administrative penalty.
The Corporation Commission found the respondents have been carrying out the fraudulent investment scheme by offering investment products such as a "private placement program" and "proprietary loan program" through D2D Financial, LLC. Investors were promised astronomical returns within a short period of time and were required to sign a form to maintain secrecy and confidentiality, which the respondents claimed was required by the “rules” of the International Chamber of Commerce in Paris, France.
The Corporation Commission found the respondents made material misrepresentations and omissions to investors such as the risks associated with the investment and Susan Arcadia's prior criminal convictions for charges that included forgery and trafficking in stolen property. Also, the respondents were not registered to offer or sell securities in Arizona.
All documents relating to this agenda item can be found in the Corporation Commission's online docket at https://edocket.azcc.gov and entering docket number S-2172A-21-0400.
Commission Revokes License and Registration and Penalizes Mesa Man for Fraud
The Corporation Commission revoked the securities salesman registration and investment adviser representative license of Scott Wayne Reed of Mesa for fraudulently selling promissory notes and ordered him to pay $1,804,901 in restitution and a $50,000 administrative penalty.
The Corporation Commission found Reed sold at least $3.5 million of investments in unregistered, high-interest promissory notes issued by Pebblekick, Inc. and received $191,340 in commissions, which Reed concealed from the firm that employed him. The Commission found Reed engaged in “selling away,” an unethical and dishonest practice of selling investments his firm did not offer and had not approved for him to sell.
The Corporation Commission also found Reed impeded the Securities Division's investigation by providing false, incomplete and misleading responses, and that he failed to timely disclose four liens the I.R.S. recorded against him for unpaid income taxes.
In settling this matter, Reed admits for purposes of this proceeding the Commission’s findings and agrees to the entry of the consent order.
All documents relating to this agenda item can be found in the Corporation Commission's online docket at https://edocket.azcc.gov and entering docket number S-21132A-20-0370.
Commission Finds Mesa Man Defrauded Investors with Ponzi Scheme Involving Real Estate
The Corporation Commission ordered respondents Timothy La Duca of Mesa and his affiliated company, Marketing Dynamics, Inc., to pay $84,216 in restitution and a $20,000 administrative penalty for defrauding investors with a real estate Ponzi scheme.
The Corporation Commission found the respondents offered and sold securities, notes issued by companies controlled by EquiAlt, LLC, to at least 22 investors, many of whom had no investment experience. As a result, the Commission found many of the investors are now struggling financially, living month-to-month.
The Corporation Commission found respondents La Duca and his affiliated company represented EquiAlt was raising capital to purchase, improve, lease and dispose of distressed real property when in actuality, EquiAlt was allegedly operating as a nationwide Ponzi scheme. The Commission found respondents made material misrepresentations and omissions to investors regarding the risk and liquidity of the securities during the offering or sale of the securities. La Duca and Marketing Dynamics, Inc. were not registered to offer or sell securities in Arizona.
In settling this matter, the respondents admit only for the purpose of this proceeding and agrees to the entry of the consent order.
All documents relating to this agenda item can be found in the Corporation Commission's online docket at https://edocket.azcc.gov and entering docket number S-21164A-21-0321.