UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION

__________________________________________

 : 

UNITED STATES SECURITIES : 

AND EXCHANGE COMMISSION, : Civil Action No: 03 C 2182 

 : 

 Plaintiff, : 

 : Judge Gottschall 

 v. : 

 : 

FRANK J. CUSTABLE, JR., et al., : Magistrate Judge Valdez 

 : 

 Defendants. : 

__________________________________________: 

FINAL JUDGMENT AS TO DEFENDANT DAVID GILES

The Securities and Exchange Commission having filed a Complaint and Defendant David 

Giles (“Defendant”) having entered a general appearance; consented to the Court’s jurisdiction 

over Defendant and the subject matter of this action; consented to entry of this Final Judgment 

without admitting or denying the allegations of the Complaint (except as to jurisdiction); waived 

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

I. 

[PERMANENT INJUNCTION AGAINST FUTURE 

VIOLATIONS OF SECTION 10(b) OF SECURITIES EXCHANGE ACT] 

 IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant and 

Defendant’s agents, servants, employees, attorneys, and all persons in active concert or 

participation with them who receive actual notice of this Final Judgment by personal service or 

otherwise are permanently restrained and enjoined from violating, directly or indirectly, Section 

10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) [15 U.S.C. § 78j(b)] and 

Rule 10b-5 promulgated thereunder [17 C.F.R. § 240.10b-5], by using any means or 
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instrumentality of interstate commerce, 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; 

(b) 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 circumstances 

 under which they were made, not misleading; or 

(c) to engage in any act, practice, or course of business which operates or would 

 operate as a fraud or deceit upon any person. 

II. 

[PERMANENT INJUNCTION AGAINST FUTURE 

VIOLATIONS OF SECTION 17(a) OF SECURITIES ACT] 

 IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant 

and Defendant’s agents, servants, employees, attorneys, and all persons in active concert or 

participation with them who receive actual notice of this Final Judgment by personal service or 

otherwise are permanently restrained and enjoined from violating Section 17(a) of the Securities 

Act of 1933 (“Securities Act”) [15 U.S.C. § 77q(a)] in the offer or sale of any security by the use 

of any means or instruments of transportation or communication in interstate commerce or by 

use of the mails, directly or indirectly: 

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

(b) to obtain money or property by means of any untrue statement of a material fact 

or any omission of a material fact necessary in order to make the statements made, in 

light of the circumstances under which they were made, not misleading; or 
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(c) to engage in any transaction, practice, or course of business which operates or 

would operate as a fraud or deceit upon the purchaser. 

III. 

[PERMANENT INJUNCTION AGAINST FUTURE 

VIOLATIONS OF SECTION 5(a) OF SECURITIES ACT] 

 IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant 

and Defendant’s agents, servants, employees, attorneys, and all persons in active concert or 

participation with him who receive actual notice of this Final Judgment by personal service or 

otherwise are permanently restrained and enjoined from violating Section 5 of the Securities Act 

[15 U.S.C. § 77e] by, directly or indirectly, in the absence of any applicable exemption: 

(a) Unless a registration statement is in effect as to a security, making use of any 

means or instruments of transportation or communication in interstate commerce 

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

or otherwise; 

(b) Unless a registration statement is in effect as to a security, carrying or causing to 

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

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

delivery after sale; or 

(c) Making use of any means or instruments of transportation or communication in 

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

or medium of any prospectus or otherwise any security, unless a registration 

statement has been filed with the Commission as to such security, or while the 

registration statement is the subject of a refusal order or stop order or (prior to the 
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effective date of the registration statement) any public proceeding or examination 

under Section 8 of the Securities Act [15 U.S.C. § 77h]. 

IV. 

[OFFICER AND DIRECTOR BAR] 

 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, pursuant to Section 

21(d)(2) of the Exchange Act [15 U.S.C. § 78u(d)(2)], and Section 20(e) of the Securities Act 

[15 U.S.C. § 77t(e)], Defendant is prohibited from acting as an officer or director of any issuer 

that has a class of securities registered pursuant to Section 12 of the Exchange Act [15 U.S.C. 

§ 78l] or that is required to file reports pursuant to Section 15(d) of the Exchange Act [15 U.S.C. 

§ 78o(d)]. 

V. 

[PENNY STOCK BAR] 

 IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant 

is permanently barred from participating in an offering of penny stock, including engaging in 

activities with a broker, dealer, or issuer for purposes of issuing, trading, or inducing or 

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

security that has a price of less than five dollars, except as provided in Rule 3a51-1 under the 

Exchange Act [17 C.F.R. 240.3a51-1]. 
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V. 

[MONETARY RELIEF] 

IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant is liable 

for disgorgement of $68,239, representing profits gained as a result of the conduct alleged in the 

Complaint, together with prejudgment interest thereon in the amount of $33,502, for a total 

monetary judgment of $101,741. Based on Defendant’s sworn representations in his Statement 

of Financial Condition and other documents and information submitted to the Commission, 

however, the Court is not ordering Defendant to pay a civil penalty and payment of all 

disgorgement and pre-judgment interest thereon is waived. The determination not to impose a 

civil penalty and to waive payment of all disgorgement and pre-judgment interest is contingent 

upon the accuracy and completeness of Defendant’s Statement of Financial Condition. If at any 

time following the entry of this Final Judgment the Commission obtains information indicating 

that Defendant’s representations to the Commission concerning his assets, income, liabilities, or 

net worth were fraudulent, misleading, inaccurate, or incomplete in any material respect as of the 

time such representations were made, the Commission may, at its sole discretion and without 

prior notice to Defendant, petition the Court for an order requiring Defendant to pay the unpaid 

portion of the disgorgement, pre-judgment and post-judgment interest thereon, and the maximum 

civil penalty allowable under the law. In connection with any such petition, the only issue shall 

be whether the financial information provided by Defendant was fraudulent, misleading, 

inaccurate, or incomplete in any material respect as of the time such representations were made. 

In its petition, the Commission may move this Court to consider all available remedies, 

including, but not limited to, ordering Defendant to pay funds or assets, directing the forfeiture of 
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any assets, or sanctions for contempt of this Final Judgment. The Commission may also request 

additional discovery. Defendant may not, by way of defense to such petition: (1) challenge the 

validity of the Consent or this Final Judgment; (2) contest the allegations in the Complaint filed 

by the Commission; (3) assert that payment of disgorgement, pre-judgment and post-judgment 

interest or a civil penalty should not be ordered; (4) contest the amount of disgorgement and prejudgment and post-judgment interest; (5) contest the imposition of the maximum civil penalty 

allowable under the law; or (6) assert any defense to liability or remedy, including, but not 

limited to, any statute of limitations defense. 

VI. 

[INCORPORATION OF CONSENT] 

 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the Consent is 

incorporated herein with the same force and effect as if fully set forth herein, and that Defendant 

shall comply with all of the undertakings and agreements set forth therein. 

VII. 

[RETENTION OF JURISDICTION] 

 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court shall retain 

jurisdiction of this matter for the purposes of enforcing the terms of this Final Judgment. 
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VIII. 

[CLERK TO ENTER JUDGMENT] 

There being no just reason for delay, pursuant to Rule 54(b) of the Federal Rules of Civil 

Procedure, the Clerk is ordered to enter this Final Judgment forthwith and without further notice. 

Dated: ______________, 2009 ____________________________________ 

Honorable Joan B. Gottschall 

United States District Judge