(Story updated 3:25 pm)

The landlord and key financial backer of the Evergreen Aviation & Space Museum – one of Oregon's biggest tourist attractions -- was accused of securities fraud this week by the U.S. Securities and Exchange Commission.

Federal regulators claim Utah-based entrepreneur Steve Down and his company, The Falls Event Center LLC, repeatedly misled investors and misrepresented the financial condition of the company. The Falls Event Center runs several large event venues and acquired the museum property in McMinnville in a bankruptcy sale.

Down, who has raised about $120 million from 300 investors since 2011, "vehemently denies" committing securities fraud, said John Neubauer, the corporate general manager of Down's organization.

The lawsuit filed Thursday raises enormous questions for the museum, home of the famed Spruce Goose. When Down's company bought the museum property in 2016, it agreed to pay the museum $70,000 a month. It's unclear now whether the company will be able to continue those payments.

The SEC lawsuit cites several examples of what it claims to be Down's false statements to investors. For example, in an October 2015 letter to investors Down said, "[w]e currently have five event centers operating; each one operating profitably." The five would have been St. George, Elk Grove (two buildings) and Fresno (two buildings). "In fact, the company's own Quickbooks accounting records show that St. George lost $104,757; Elk Grove lost $657,261; and Fresno lost $102,682," the SEC claimed.

Evergreen timeline

December 2013

: Evergreen International Airlines files for Chapter 7 bankruptcy on New Year’s Eve. The airline had helped fund the Evergreen Aviation & Space Museum.

November 2014

: Delford Smith, founder of Evergreen and the associated museum and waterpark, dies at age 84.

2015

: Maine developer George Schott buys aviation museum property for $22 million with support from an aviation nonprofit called The Collings Foundation.

February 2016

: Michael King Smith Foundation, owner of Evergreen Aviation & Space Museum, files for bankruptcy. The filing averts a foreclosure auction.

August 2016

: Utah investment group The Falls Event Center buys the space museum, the Wings & Waves Waterpark and other nearby property. Businessman Steve Down controls Falls Event Center and led the deal.

August 2017

: Aviation buffs learn The Falls Event Center quietly sold two of its vintage airplanes. The Oregonian/OregonLive reports federal securities regulators are investigating Steve Down and his companies, including The Falls Event Center.

September 2017

: Down files $25 million lawsuit against two Oregon men, accusing them of trying to sabotage his business.

April 2018

: Evergreen museum sues The Falls Event Center – which runs the waterpark – alleging it hasn’t made agreed-upon monthly payments.

May 2018:

The SEC accuses Down of securities fraud.

The complaint came prepackaged, with a settlement agreement in which Down agreed to a $150,000 fine. But on Friday, furious officials in the Down organization said they intended to back out of the agreement. The allegations in the complaint are false and the Down organization "looks forward to defending each and every allegation before a judge," the company said.

In a press release, the Falls Event Center included a passage from a letter its law firm sent to the SEC: "The complaint is literally a "death knell" for the events center and Steve Down's efforts to raise money for his businesses, which we assume you know," the letter said.

Later in the same press release, Down vowed the Falls Event Center will continue to conduct business as usual. " This is in no way a "death knell" to our company despite the recklessness and false allegations by the SEC," Down said.

The new lawsuit marks the second time Down has crossed swords with the SEC. In 1996, the commission sued Down and Investor Dynamics Corp. claiming they made fraudulent representations to investors while pitching a multi-level marketing scheme.

Down arrived in McMinnville calling himself a "cause capitalist," someone as interested in the social good as making money. For instance, he co-owned a sandwich restaurant chain that promised to feed a homeless person for every sandwich it sold.

But some museum officials began to have misgivings about Down last summer when he sold two airplanes out of the museum to get his organization through a cash-flow crunch. Down sold two rare World War II fighters -- a Corsair and a P-51 Mustang -- at a bargain basement price.

As The Oregonian/OregonLive first reported last July, the SEC had launched an investigation of Down's organization in late 2016. Down confirmed at the time that the securities regulators were investigating some of his companies. But he said he and his staff had followed the law and that federal investigators were preparing to shut down the inquiry.

Paul Gelinas, chair of the museum board, said he learned of the SEC lawsuit against Down after The Oregonian/OregonLive posted its story on Friday. Withe the retired Marine at the helm, the museum last month sued The Falls Event Center claiming the Down company was behind on its monthly payments by $59,000.

"We're not just going to tread water any more," Gelinas said. "We're going to go after this guy."

-- Jeff Manning