SEC Sues Business Owner Over $614,000 Medical Device Scam

A Tennessee resident raised about $730,000 through promissory notes sold to a single investor to buy and install medical devices in doctors’ offices, but paid back only a fraction, the SEC alleges.

Clayton Thomas and his business, Personalized Healthcare Solution LLC, padded the cost of the TM-Flow System devices and overstated the anticipated monthly profit when speaking to the investor, the Securities and Exchange Commission says. It filed its suit Tuesday in the US District Court for the Middle District of Tennessee.

The investor ultimately lost about $614,000, the agency says.

The TM-Flow device, made by another company, “collects multiple ...