Candace Klein: New documents detail Ohio's case against embattled entrepreneur and her defense

Hearing scheduled to start Feb. 19

Northern Kentucky native Candace Klein is either a passionate champion for crowdfunding who is being persecuted by regulators or a relentlessly ambitious entrepreneur willing to say whatever it takes to succeed.

A new hearing in the case against her was set to start Monday in Columbus. (WCPO's Lucy May will follow the case. Follow her on Twitter at @LucyMayCincy for updates as they happen.)

Pre-hearing documents filed Feb. 12 in an Ohio Division of Securities case against Klein paint those two starkly different pictures of the embattled founder and former CEO of Cincinnati-based SoMoLend.

The briefs, obtained by WCPO through a public records request, set the stage for a hearing in Columbus scheduled to start Feb. 19. Neither Klein nor state officials have been willing to say much publicly before the hearing.

As a result, the brief filed by Klein’s Chicago-based attorney offers her most detailed public defense since last August, when the state’s allegations against her and SoMoLend made local and national headlines.

In the brief, attorney Michelle L. Casper argues the Ohio Division of Securities’ allegations have gone “overboard and are completely without merit.”

Those allegations were detailed in a June 14 notice from the division, which accused Klein and SoMoLend of various misdeeds. Those included selling unregistered securities, committing securities fraud by overstating SoMoLend’s early success and making fraudulent financial projections by exaggerating revenue projections during public presentations and statements.

This much is clear: Klein appears ready for battle with state regulators at the hearing, which could determine her future in the crowdfunding industry she helped shape. 

WCPO Insiders can read more about Klein's defense and the case the state will make against her. Insiders can also see both briefs in their entirety.

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