The SEC and the U.S. Attorney’s Office for the Eastern District of Virginia have charged a Virginia real-estate developer with securities fraud and skimming investor funds that were intended to be used to purchase an office building near the site of a planned commuter rail station on the Washington, D.C. Metro’s Area Silver Line.

Todd Elliott Hitt, 53, used two of his companies--Kiddar Capital LLC and Kiddar Group Holdings Inc.--to raise more than $20 million from investors over at least a four-year period, according to the Securities and Exchange Commission complaint. The money was raised to acquire and operate the office building, new home construction in Northern Virginia, and to invest in a startup business.

The complaint further alleges that Hitt raised the funds by misrepresenting that he would invest $6 million as a general partner as part of the planned $33 million purchase. The SEC complaint also alleges commingling and misappropriation of investments in various real estate and other projects.

Hitt is alleged to have committed securities fraud in connection with his ownership and operation of Kiddar Capital, a self-described asset management firm based in Falls Church. According to court documents, he falsely claimed that Kiddar Capital managed $1.4 billion in assets and had offices located in Houston, Palm Springs and London.

The SEC alleges that Hitt misappropriated several million dollars of investor funds to support his extravagant lifestyle and that he made Ponzi-like payments to prior investors. As part of his settlement with the SEC, the terms of which remain subject to court approval, Hitt consented to entry of a judgment freezing his assets and that prevent him from participating in the offer or sale of interests in real estate development companies.

Also, he consented to the appointment of a receiver over a number of the corporate defendants and relief defendants. Under the terms of the proposed settlement, the receiver would protect investors, prevent asset dissipation and loss, and attend to the businesses. Penalties and disgorgement will be determined by the court at a later date.

“We moved quickly to preserve the value of investors’ stake in a number of commercial and residential properties in Northern Virginia,” said Melissa Hodgman, associate director in the division of enforcement for the SEC. “The total package of relief obtained in the settlement ensures that Hitt’s assets will be used to compensate harmed investors and will limit his ability to harm investors in the future.”