Peterson claimed that two prominent Wall Street financial firms had partnered with him to bring his offering to market, and that the firms had conducted due diligence on USA Real Estate Fund and were structuring sales agreements and pricing, the SEC said.

Peterson promised the early investors they would profit massively once the purported future offering was under way.

However, Peterson's claims were false, according to the SEC. He had no guaranteed investment product to offer, the projected returns were either fictitious or based on implausible and unsupported analyses, and he has no affiliation with any financial firm to underwrite his purported future offering, the SEC alleged.

Peterson used investor money to pay for his rent, food, entertainment, vacations, and a rented Mercedes Benz SUV, the SEC said. He also used investor funds on clothing for friends, luggage for his wife, and expenses at a Las Vegas casino.

“We've brought this court action to stop Peterson's fraud in its tracks before it picks up more steam,” said Michael Dicke, associate director in the SEC's San Francisco regional office. “The JOBS Act is intended to help small businesses raise capital, not to legalize fraud or give unscrupulous entrepreneurs a right to make false claims to fleece investors.”

Signed into law on April 5, 2012, by President Obama, the JOBS Act was designed to encourage funding of U.S. small businesses by easing various securities regulations,

The SEC's complaint charges USA Real Estate Fund and Peterson with violating the anti-fraud provisions of the federal securities laws. The agency is seeking a court order requiring both to return their alleged ill-gotten gains, with interest, and pay financial penalties, the SEC said.

The agency is also seeking a preliminary injunction restraining USA Real Estate Fund and Peterson from engaging in conduct that would allow them to continue their operation and restraining them from further violations of the securities laws.