IJNTIED STAT.'ES DISTRICT COI]RT

NORTHERN DISTRICT OF ILLINOIS

EASTERN DTVISION

UI\ITED STATES SECURITIES

AI{D f,XCHANGE COMMISSION,

PIaintiff,

v.

KENITETEA. DACHMAN,

SCOTT A. WOLF' and

sroNE LroN MANAGEMEDTT, rNC.,

Case No. 1: 12-cv-00821-YMK

Hon. Judge Virginia M, Kendall

Hon. Magistrate Judge Sheila M, Finnegan

Defendants.

JTIDGMENT AS TO DETEI\DANT KEI\NETH A- DACEMAN

The Securities and Exohange Commission having filed a Complaint and Defendant

Kenneth A. Dachman (oDacbman') having entered a general appearance; consented to the

Court's jurisdiction over him and the subject matter of this actioq consented to entry of this

Judgment; waived findings of fact and conclusions of law; and waived any right to appeal from

this Judgment:

I.

IT ISI HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant

Dachman and Defendant Dachman's agents, servants, employees, attomeys, and all persons in

active concert or participation with them who receive actual notice ofthis Judgment bypersonal

service or otherwise are permanently restained and eqioined from violating Section 5 ofthe

Secnrities Act of 1933 ('Securities Act') [15 U.S.C. $ 77e] by, directly or indirectln in the

absence of any applicable exemption:

Case: 1:12-cv-00821 Document #: 71 Filed: 02/11/14 Page 1 of 7 PageID #:536
Unless a registation statement is in effect as to a security, making use of any

means or instrr:menls oftransportation or communication in interstate contmerce

or of the mails to sell such security through the use or medium of any prospectus

or otherwise;

Unless a regisfiation statement is in effect as to a security, carrying or causing to

be carried through the mails or in interstate corrmerce, by any means or

instruments of tansportation, any such security for the purpose of sale or for

delivery after sale; or

Making use of any means or instruments of transporiation or communication in

interstate commerce or of the mails to offer to sell or offer to buy tbrough the use

or medium of any prospectus or otherwise any secr:rity, unless a registration

statement has been fild with the Commission as to zuch secwity, or rlfiile the

regismation statement is the subject of a refusal order or stop order or (prior to the

effective date of the registation statement) any public proceeding or examination

under Section 8 ofthe Securities Act [l5 U.S.C. $ 77h].

II.

IT IS ITRREBY FURTHER ORDERED, ADJTIDGED, ATID DECREED that

Defendant Dachman and Defendant Dachman's agents, seryants, employees, afiorneys, and all

persons in active concert or participation with them who receive actual notice of this Judgment

by personal service or otlenrise are permanently restrained and eqjoined &om violating Section

17(a) of the Secruities Act [15 U.S.C. $ 77q(a)] in the offer or sale of any security by the use of

any means or insfr:ments of transportation or communication in interstate cornmerce or by use

of the mails, directly or indirectly:

(a)

(b)

(c)

Case: 1:12-cv-00821 Document #: 71 Filed: 02/11/14 Page 2 of 7 PageID #:537
to employ any device, scheme, or artifice to defraud;

to obtain money or property by means of any uotrue stratement of a material fact

or any omission of a material fact necessary in order to make the stalements

made, in light of the circumstances under which they were made, not misleading;

or

to engage in any transaction, practice, or course ofbusiness which operates or

would operate as a fraud or deceit upon the purchaser.

m.

rr rs HEREBY TURTHER ORDERED, {)JTIDGED, AND DECREED that

Defendant Dacbman and Defendant Dachman's agents, servants,.employees, attomeys, and all

percorxr in active concert or participation with them who receive actual notice of this Judgment

by personal service or otherwise are permanently restrained and er{oined from violating, directly

or indirectly, SecJion 10(b) of the Secudties Exchange Act of 1934 (the "Exchange Act") [15

U.S.C. $ 78j@)l and Rule l0b-'5 promulgated thereunder [7 C.F.R- $ 240.10b-5], by using any

means or instrumentality of intcrstate.cofilmerc€, or of the mails, or of any facility of any

national securities exchange, in connection with the purchase or sale of any security:

(a) to employ any device, scheme, or artifice to defraud;

O) to make any untrue statement of a material fact or to omit to state a material fact

necessary in order to make the statements made, in the light of the circr:mstances

rmder which they were made, not misleading; or

to engage in any ac{ pmctice, or course of business which operates orwould

operate as a fraud or deceit q)on any persoL

(a)

(b)

(c)

(c)

-3-

Case: 1:12-cv-00821 Document #: 71 Filed: 02/11/14 Page 3 of 7 PageID #:538
Iv.

IT IS IIEREBY FTIRTIIER ORDERED, ADJUDGED, AND DECREED thAt

Defendant Dachman is permanently barred from participating in an offering of penny stoch

including engaging in activities with a broker, dealer, or issuer for pulposes of issuing, trading, .

or inducing or attempting to induce the purchase or sale of any penny stock. A penny stock is

any equity secwity that has a price of less than five dollars, except as provided in Rule 3a51-l

uuderthe Exchange Act [17 C.F.R 240.3a51-11

is liable for disgorgement of $1,875,73r.F, represe,nting profits gained as aresult of the 

;

conduct alleged in the Complaint together with prejudgment interest thereon in the amount of ..

$289,648;86. Defendant Dachman shall satisff this obligation by paying $2,165,388.28 to the

Securities and Exchange Commissionwithin 14 days after enty ofthis Judgme,nt.

Defendant Dachman may tansmit payment electronically to the Commission, which will ,.

provide detailed ACH transferlFedwire insfirctions upon request. Payment may also be made , 

,

j

direcfly from a bank.account via Pay.gov through the SEC website at :

http://www.sec.qov/about/officeVofrn.htu. Defendant Dachman may also pay by certified

checlg bank cashier's check, or United States postal money order payable to the Securities and

Exchange Commission, which shall be delivered or mailed to

Enterprise Services Center

Accounts Receivable Branch

6500 South MacArthur Boulevard

OklahomaCiry, OK 73169

Case: 1:12-cv-00821 Document #: 71 Filed: 02/11/14 Page 4 of 7 PageID #:539
and shall be accompanied by a letter identi&ing the case title, civil action number, and narne of

this Courq Kenneth A. Dachman as a defendant in this action; and speciffing that payment is

made pursuantto this Judgment"

Defendant Dachman shall simultaneously transmit photocopigs of evidence of payment

and case identiffing informationto the Corimission's counsel in this action. By making this

paymen! Defendant Dachman relinquishes all legal and equitable rig!! title, and interest in such

fiuds and uo part of the firnds shall be retumed to Defendant Dachman.

The Commission shall hold the fimds (collectiveln the *Fund') and may pmpose aplan

to distribute the Fund subject to the Court's approval. The Court shall retain jurisdiction over the

administration of any disfibution of the Fund. If the Commission staffdetermines that the Fund

will not be dishibuted, the Commission shall sendthe flrnds paid pursuant to this Final Judgment

to the United States Treasury.

The Commission may enforce the Court's judgment for disgorgement and prejudgment

interest by moving for civil contempt (and/or through other collection procedures authorized by

law) at any time after 14 days following entry of this Judgment. Defendant Dachman shall pay

post judgment interest on any delinquent nmounts pursuant to 28 U.S.C. $ 1961.

YI.

Upon moton ofthe Commission, the Court shall determine whether it is appropriate to

order a civil penalty pursuant to Section 20(d) of the Securities Act [15 U.S.C. $ 7ft(dl and

Section 21(dX3) of the Exchange Act [15 U.S.C. $ 78(dX3)] and, if so, the amount ofthe civil

penalty. In connection with the Commission's motion for civil peiralties, and at any hearing held

on such a motion: (a) Defendant Dachman will be precluded from arguing that he did not violate

the federal securities laws as alleged in the Complain! (b) Defendant Dachman may not

-5-

Case: 1:12-cv-00821 Document #: 71 Filed: 02/11/14 Page 5 of 7 PageID #:540
challenge the vatidity of the Consent or this Judgpent; (c) solely for the purposes of such

motion, the allegations of the Complaint shall be accepted as and deemed tue by the CouS and

(d) the Court may determine the issues raised in the motion on the basis of affi.davits, 

.

declarations, excerpts of sworn deposition or investigative testimony, and documentary evidence,

without regard to the standards for summary judgment contained in Rule 56(c) of the Federal

Rules of Civil Procedure. In connection with the Commission's motion for civil penalties, the

parties maytake discovery, including discovery from appropriate non-parties

VII.

IT IS x"URTmR ORDERED, ADJIIDGED, AI\ID DECREED that Defendant

Dachman's Consent is incorporated herein with the same force and effect as if fully set forth

hereir:r and that Defendant Dacbman shall comply with all of the undertakings and agreements

set forlh therein

vrII.

m IS FURTHER ORDERED, ADJLIDGED, AND DECREED tha! solely for

purposes of exceptions to discharge set forth in Section 523 of the Banlcruptcy Code, I I U.S.C.

$523, the allegations inthe complaint axe true aod admitted by Defendan! and fi:rther, any debt

for disgorgemen! prejudgment interes! civil penalty or other amormts due by Defendantunder

this Judgment or any other judgment order, consent order, decree or settlement agreement

entered in connection with this proceeding, is a debt for the violation by Defendant Dachman of

the federal securities laws or any regulation or order iszued under such laws, as set forth in

Section 523(a)(19) ofthe Bankruptcy Code, 11 U.S.C. $523(a)(19).

-6-

Case: 1:12-cv-00821 Document #: 71 Filed: 02/11/14 Page 6 of 7 PageID #:541
I)L

m IS f"URTmR ORDERED, ADJUDGED, AND DECREED that this Court shall

retain jurisdiction of this matter for the purposes of enforcing the terms of this Judgment.

x

There being no just reason for delan pursuant to Rule 5 (b) of Federal Rules of Civil

Procedure, the Clerk is orderedto enter this Judgment andwithout

"?- /k //

M]

-7-

Case: 1:12-cv-00821 Document #: 71 Filed: 02/11/14 Page 7 of 7 PageID #:542