Litigation Releases (Mark D. Anderson; BBFY USA, Inc.; and Captain Drake, LLC)

U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 26523 / April 8, 2026

Securities and Exchange Commission v. Mark D. Anderson, BBFY USA, Inc., and Captain Drake, LLC, No. 26-cv-02174 (D. Minn. filed Apr. 7, 2026)

SEC Charges Founder and CEO of Minnesota Company in Alleged Fraud Scheme

On April 7, 2026, the Securities and Exchange Commission filed charges against Mark D. Anderson, the founder and CEO of Drake's Organic Spirits, Inc., and two entities he owned and controlled, BBFY USA, Inc. and Captain Drake, LLC, for allegedly orchestrating sham sales transactions and conducting an offering fraud using false financial statements to solicit investors.

The SEC's complaint alleges that in the last two weeks of December 2021, Anderson directed Drake's Organic Spirits staff to book approximately $2.6 million in sham sales. To accomplish these sham sales, Anderson allegedly utilized bank accounts in the names of BBFY USA and another Anderson d/b/a entity to transfer funds to Drake's Organic Spirits. In a series of alleged round-trip transactions, Anderson then transferred approximately the same amount from Drake's Organic Spirits to Captain Drake. The complaint alleges that between February and December 2022, using offering documents that included the 2021 sham sales, Drake's Organic Spirits and Anderson raised approximately $1.5 million from investors in an offering of convertible debt. The complaint further alleges that, in 2022, Anderson again directed Drake's Organic Spirits staff to book approximately $391,000 in sham sales and between approximately February and March 2023, using offering documents that included the false 2022 sales, Drake's Organic Spirits and Anderson raised more than $900,000 from investors in a rights offering for preferred stock.

The SEC's complaint charges Anderson with violating the antifraud provisions of Sections 17(a)(1) and (3) of the Securities Act of 1933 and Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint charges BBFY USA and Captain Drake with violating the antifraud provisions of Sections 17(a)(1) and (3) of the Securities Act of 1933 and Section 10(b) of the Securities and Exchange Act of 1934 and Rules 10b-5(a) and (c) thereunder. The SEC seeks permanent injunctions and civil penalties against all defendants and a conduct-based injunction against Anderson, barring him from participating in the issuance, purchase, offer, or sale of any security, except for purchases or sales for his own personal accounts.

The SEC's investigation was conducted by Emily Scruggs and Kimberly Steckling and supervised by Ian Karpel and Nicholas Heinke, all of the SEC's Denver Regional Office. The litigation will be led by Zachary Carlyle and supervised by Gregory Kasper.