Digi Outdoor Media Sued by SEC

Digi Outdoor Media Inc., a company which raised $4.5 million to construct and install digital signs for commercial advertising around Washington DC has been sued by the Securities and Exchange Commission for theft of more than $2.3 million from investors.

You can read the lawsuit here.  The lawsuit alleges that Donald MacCord Jr. and Shannon D. Doyle siphoned off more than $2 million of the $4.5 million in proceeds that from 60 investors to build a digital sign network in Washington DC by creating a fictitious vendor – Signworks, LLC.  Signworks, LLC charged Digi Outdoor for construction and improvements at properties in DC.  The lawsuit alleges that the work was never performed and that “MacCord and Doyle then used at least 2.3 million of the Digi investor money transferred to Signworks to pay MacCord’s personal expenses and to fund Doyle’s other businesses.”

Insider wrote in December 2016 that Digi Media Communications, LLC. was attempting to install 52 digital signs at 20 locations in Washington DC by placing the signed underneath building facade overhangs in order to avoid DC sign restrictions.  Washington DC has requested a court order requiring Digi Media Communications LLC. to remove the digital billboards.  The case is pending.

Insider’s take:  Insider expects this will be the nail in the coffin of Digi Media’s attempt to avoid DC sign restrictions.  Fraud in the out of home business usually occurs in the markup of construction expenses for new signs.  If you are invested in an out of home business you need to carefully monitor how much money is being invested in new builds and who the money is being paid to.

 


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