ATLANTA (Bloomberg) The US Securities and Exchange Commission has won a federal court order in Atlanta to freeze assets of a Utah man and his Ontario business partner in an alleged investment scam that raised $30 million by touting risk-free profits.

Judge Orinda Evans issued the order after the SEC accused Ontarian James Jeffery and Thomas Repke of fraudulently luring more than 150 investors since 2006 by promising monthly returns of up to eight per cent on money placed in an escrow account, the agency said in a statement.

The SEC said in a civil lawsuit filed last Thursday that the pair loaned $3.4 million of investors' money to an entity they controlled and moved other funds offshore, possibly placing some in a Bermuda hedge fund that isn't yet operating.

"The defendants have misrepresented to investors that their principal is protected and never leaves the escrow account, or is secured by collateral," the SEC said in its suit. "In fact, no such risk-free investment exists."

Evans temporarily froze assets controlled by the defendants and entities they used, which included Coadum Advisors Inc., Mansell Capital Partners III, Coadum Capital Fund I, II and III, and Mansell Acquisition.

A hearing is set for January 17. There was no reply to a message left yesterday at a Belleville phone number listed in Jeffery's name.