Source: http://www.scribd.com/doc/33719372/S-E-C-Lawsuit-Against-Penny-Stock-Chaser
Timestamp: 2015-07-04 04:30:52
Document Index: 622172484

Matched Legal Cases: ['§77', '§ 77', '§78', '§240', '§77', '§78']

P. 1S.E.C. Lawsuit Against Penny Stock ChaserS.E.C. Lawsuit Against Penny Stock ChaserRatings: (0)|Views: 7,347|Likes: 31Published by DealBookLawsuit by the Securities and Exchange Commission against two penny stock touts for fraudulently pumping up shares in companies through their site, Penny Stock Chaser.Lawsuit by the Securities and Exchange Commission against two penny stock touts for fraudulently pumping up shares in companies through their site, Penny Stock Chaser.More info:Categories:Types, Business/Law, Court FilingsPublished by: DealBook on Jun 29, 2010Copyright:Attribution Non-commercialAvailability:Read on Scribd mobile: iPhone, iPad and Android.download as PDF, TXT or read online from ScribdFlag for inappropriate content|Add to collectionSee moreSee lesshttps://www.scribd.com/doc/33719372/S-E-C-Lawsuit-Against-Penny-Stock-Chaser03/08/2011pdftextoriginal UNITED STATES
FLORIDACASE NO.SECURITIES AND EXCHANGE COMMISSION,Plaintiff,
1 0 ~ 8 0 7 4 8
-COHN
) MAGISTRATE
) SELTZER
UNDER SEALCAROL MCKEOWN, DANIEL F. RYAN,
MEADOW VISTA FINANCIAL CORP.,
AND DOWNSHIRE CAPITAL INC.,
018T.CT.
OTHER RELI
Plaintiff Securities and Exchange Commission alleges:I. INTRODUCTION
The Commission brings this emergency action to enjoin two Canadian residentsfrom using a website they control to tout United States microcap companies, while at the·sametime clandestinely selling millions
the same companies to profit from the demandthey help create through their touting.2. Starting no later than April 2009, Carol McKeown and Daniel
Ryan, who holdthemselves out
husband and wife, have used the website www.PennyStockChaser.com.
toutdozens
U.S. companies. At the same time, McKeown and Ryan have liquidated millions
the same companies through their two corporations, Downshire Capital hie., andMeadow Vista Financial Corp.
compensate McKeown and Ryan for the PennyStockChaser website's touting,affiliates
the touted companies ("issuers") or third parties give shares to Downshire and
Meadow Vista.Those compames then sell the shares on the open market whilePennyStockChaser simultaneously predicts massive price increases for the issuers, a practiceknown as "scalping."
Furthermore, on at least two occasions, McKeown and Ryan have failed to fullydisclose on PennyStockChaser the full amount
the stock they and their companies havereceived
exchange for the touting.
The Defendants have realized at least $2.4 million in net proceeds from theirscalping scheme.
Through their conduct, McKeown, Ryan, Downshire, and Meadow Vista haveviolated Section 17(a)
1933 ("Securities Act") [15 U.S.C. §77q(a) and
U.S.C. § 77(q)(b)]; and Section lO(b)
1934 ("Exchange Act")and Exchange Act Rule
lOb-5
[15 U.S.C. §78j(b) and
C.F.R. §240.lOb-5]. McKeown, Ryan,and Meadow Vista have also violated Section 17(b)
the Securities Act. Unless the Courtenjoins them, they are reasonably likely to continue to violate these provisions.
McKeown, 44, is a Canadian citizen residing in Montreal, Canada. She is theowner and sole officer and director
Downshire and the president and owner
Meadow Vista.She also owns the trade mark "PennyStockChaser" in the United States and Canada. Shelicensed the trade mark "PennyStockChaser" to Downshire. She and Ryan controlPennyStockChaser.
Ryan also resides in Montreal. Ryan has entered into agreements on behalf
Downshire as its managing director, and has conducted trading on behalf
Downshire andMeadow Vista. He also helps control PennyStockChaser.2
Downshire is a Quebec, Canada corporation headquartered in Montreal.
purports to be a private investment banking group.
holds the license to use the trade mark"PennyStockChaser" in the United States and Canada, whose stated services include providing awebsite featuring stock market information.
Meadow Vista is a Wyoming corporation which purports to be an investmentbank headquartered in Cheyenne, Wyoming.
III. JURISDICTION AND
11. The Court has jurisdiction over this action pursuant to Sections 20(b), 20(d), and22(a)
U.S.C. §§77t(b), 77t(d), and 77(v)(a)]; and Sections 21(d), 21(e),and 27
U.S.C. §§78u(d), 78u(e), and 78aa].
The Court has personal jurisdiction over the Defendants, and venue is appropriatein the Southern District
Florida. As described below, many
transactions, acts, practicesand courses
c o n s t ~ t u t i n g
the Securities Act and Exchange Act occurredin the Southern District
Florida as well as in the United States.
For example, Meadow Vista maintains brokerage accounts at a firm in BocaRaton, Florida, where the Defendants receive, purchase, and sell shares
the companies toutedon PennyStockChaser. McKeown signed the account opening forms for these accounts, and islisted as corporation owner on them. McKeown and Ryan control and manage these brokerageaccounts, including by regularly sending e-mails to brokers at the Boca Raton
directingtrading in these accounts. Downshire and Meadow Vista also maintain accounts at no fewer thanthree other brokerage firms in the United States, where McKeown has also signed accountopening forms.
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