The Securities and Exchange Commission sued three individuals in Utah, alleging they fraudulently sold more than $3.5 million in 19th century state and railroad bonds.

In a case filed in federal court in Salt Lake City Thursday, the SEC alleged that Albert E. Carter, Kelly Polatis and Eunice Polatis sold the bonds, which allegedly have only nominal value as collectibles, as investment vehicles capable of generating huge returns.Lawyers for the defendants couldn't be reached immediately for comment.

The bonds, sold since at least March 1997, were issued by the Chicago, Saginaw & Canada Railway Co. in 1873, the East Alabama & Cincinnati Railway Co. in 1870 and by the state of Mississippi in 1838.

Also Thursday, a federal judge issued an order freezing the defendants' assets. Among other remedies, the SEC is seeking disgorgement of ill-gotten gains and civil penalties.