Source: https://www.compliance.ai/enforcement-report/august-26-2018/
Timestamp: 2020-05-26 05:21:29
Document Index: 499458604

Matched Legal Cases: ['in Fine', '§ 4012', 'in Fine', 'in Fine', 'in Fine', '§ 201']

Financial Enforcement Actions | Week of August 26 to 31 | Compliance.ai
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Financial Enforcement Actions | Week of August 26 to 31
August 2018 Enforcement Action Summary
$16,000.00 in Fines
Penalties: $16,000.00
Violation: A pattern or practice of violations under Section 102(f)(2) of the Act, 42 U.S.C. § 4012a(f)(2)... Read More
$1,466,781.00 in Fines
Respondent: Victoria Lucia DelloRusso
Violation: On September 26, 2017, while associated with RBC, DelloRusso possessed prohibited material during unscheduled breaks while taking the Series 7 examination, in violation of FINRA Rule 2010... Read More
Respondent: J. Gordon Cloutier Jr.
Violation: Failing to appear and provide testimony under oath as requested pursuant to FINRA Rule 8210... Read More
Respondent: David W. Unsworth
Violation: Unsworth failed to disclose to NSC his participation in private securities transactions involving a private company. Unsworth sold his personal and business holdings in the company in March and April 2016 for proceeds totaling $68,237.99 to an individual without prior notice to NSC. Consequently, he violated FINRA Rules 3280 and 2010... Read More
Penalties: $1,011,781.00
Respondent: Matthew Evan Eckstein
Violation: Respondent made false and misleading statements in connection with purchases and sales of securities in willful violation of Section 10(b) of the Exchnage Act and Exchange Act Rule 10b-5, as well as FINRA Rules 2020 and 2010... Read More
Respondent: David N. Winger
Violation: Between April 2015 and April 2018 (the "Relevant Period"), while associated with PFS, Winger converted customer funds in violation of FINRA Rules 2150(a) and 2010... Read More
Violation: Respondent failed to submit, untimely submitted, or inaccurately submitted billions of ROEs over a four-year period... Read More
$21,000,000.00 in Fines
Image Source: Expert Senior Planning
Penalties: $21,000,000.00
Respondent: Lights of America Refunds
Violation: Violating federal law by overstating the light output and life expectancy of their LED bulbs, and falsely comparing the brightness of their LED bulbs with that of other light bulbs... Read More
53 Enforcement Documents
$204,564,562.59 in Fines
Respondent: Rio Bravo Oil, Inc. and UAN Cultural & Creative Co., Ltd.
Image Source: WacoTrib
Respondent: Kendricks, et al.
Violation: After meeting at a party, Mychal Kendricks began receiving illegal tips from Damilare Sonoiki, an analyst at an investment bank who had access to confidential, nonpublic information about upcoming corporate mergers. Kendricks allegedly made $1.2 million in illegal profits by purchasing securities in companies that were soon to be acquired and then selling his positions after the deals were publicly announced, in one instance generating a nearly 400 percent return on his investment in just two weeks... Read More
Respondent: David Gray
Violation: The defendants misrepresented to investors that their money would be used to develop and market LottoNet’s business, which purportedly facilitated online and cell phone sales of lottery tickets in various states, and that sales agents did not receive commissions. In fact, at least 35 percent of investor proceeds were allegedly paid to boiler room sales agents in the form of commissions, and Gray allegedly siphoned investor funds from LottoNet for personal spending on clothing, wedding-related expenses, and strip clubs... Read More
Penalties: $97,602,040.00
Respondent: AEGON USA Investment Management, LLC, et al.
Violation: Between July 2011 and June 2015 (the “Relevant Period”), Respondents violated the federal securities laws and rules thereunder while offering, selling, and managing 15 quantitative-model-based mutual funds, variable life insurance investment portfolios, and variable annuity investment portfolios (each of which was a registered investment company and collectively are the “Products”) and separately managed account (“SMA”) strategies (the “Strategies”) (collectively, the “Products and Strategies”)... Read More
Respondent: Kevin A. Giles
Violation: AUIM failed to adopt and implement certain compliance policies and procedures, including failing to take reasonable steps to ensure that: (1) its quantitative models worked as intended both before the Products’ launched and on a periodic basis after they launched; (2) it adopted and implemented reasonable controls regarding the testing, approval, and documentation of any changes to its quantitative models; and (3) the Products’ portfolio managers’ discretion to depart from model-directed trades was defined, monitored, and documented... Read More
Respondent: Lynette M. Robbins
Violation: Between June 2014, and December 2017, Robbins, through Knowles, offered and sold Woodbridge securities. Neither Knowles, Robbins, nor Woodbridge were associated with Commission-registered broker dealers and none of Woodbridge’s securities offerings were registered with the Commission... Read More
Penalties: $69,004,988.00
Respondent: Legg Mason, Inc.
Violation: From approximately 2005 to 2008, Société Générale paid the Libyan Intermediary approximately $26.25 million for supposed “introductory” services. Nevertheless, by at least 2006, two Permal employees were aware that the intermediary was paying bribes to Libyan government officials in order to secure investments. These two now former Permal employees agreed to continue to use the Libyan Intermediary notwithstanding that knowledge... Read More
Respondent: Micra Soundcards Inc., Mirex, Inc. and Myotec, Inc.
Respondent: IDO Security, Inc., Redify Group, Inc. and Spartan Gold Ltd.
Respondent: SEC Complaint - Sandy J. Masselli, Jr. et al.
Violation: This case involves a securities offering fraud perpetrated by Masselli, who misappropriated at least hundreds of thousands, and potentially millions, of dollars from retail investors for his own personal use... Read More
Penalties: $65,000.00
Respondent: Bradley J. Beman
Violation: Beman, despite being aware of the risks that the models would not work as intended, did not take sufficient steps to have AUIM confirm the accuracy of the models. He also did not identify the Analyst as the portfolio manager of certain of the Products despite being aware of his role in developing and managing the models... Read More
Respondent: Equilar Capital Corp. and Neuro-Biotech Corporation
Respondent: SEC Complaint - Richard J. Greenlaw et al.
Violation: This case involves the unregistered offering and sale of securities in a Mainebased medical marijuana company NECS, by Greenlaw, the founder and managing member of NECS, as well the Cannabis-Related Entities in violation of the registration provisions of the federal securities laws... Read More
Respondent: Sandy J. Masselli, Jr. et al.
Violation: Sold certain investors stock in the Carlyle entities, which were purportedly engaged in online gaming, by falsely claiming that the companies were on the verge of conducting a lucrative initial public offering (IPO) and were soon to be listed on major U.S. stock exchanges... Read More
Violation: Greenlaw sold ownership interests in the companies by posting advertisements on Craigslist. When prospective investors responded to his online ads, Greenlaw followed up with securities offering documents and sales materials describing the purported marijuana products. No registration statement was on file or in effect with the SEC with respect to this offering of securities... Read More
Respondent: Equitybuild, Inc. et al.
Violation: The defendants sold at least $135 million in unregistered promissory notes to at least 900 investors throughout the country... Read More
Respondent: Great Wall Builders Ltd., PuraMed BioScience, Inc. and TagLikeMe Corp.
Penalties: $1,250,000.00
Respondent: Moody's Investors Service, Inc.
Violation: This matter concerns Moody’s failure to establish, maintain, enforce and document policies and procedures reasonably designed to clearly define and consistently apply credit rating symbols as required by the Exchange Act... Read More
Violation: From 2010 to 2013, MIS failed to establish, maintain, enforce, and document an effective internal control structure with regard to its use of certain models in its methodology for rating RMBS... Read More
Penalties: $10,779.65
Respondent: Delaney Equity Group LLC, David C. Delaney and Ian C. Kass
Violation: Between September 2009 and October 2013, three undisclosed control persons (the “Control Persons”) fraudulently manufactured at least 12 undisclosed “blank check” companies (the “Blank Check Companies”) for sale by reverse merger... Read More
Respondent: John A. Henderson and Global Resources Leadership, LLC
Violation: The SEC is investigating potential violations of the federal securities laws in connection with Global Resources Leadership's joint venture arrangement with a third party to raise money from investors to buy and sell crude oil. The joint venture arrangement was entered into in or about 2015... Read More
Penalties: $565,470.18
Respondent: David Michael Naylor, CPA
Violation: Engaged in an unregistered general solicitation of ITEC securities, obtained money or property by means of material misrepresentations in the offer or sale of ITEC securities, aided and abetted the making of numerous material misrepresentations in offering documents ITEC provided to prospective investors, and engaged in a fraudulent scheme which resulted in ITEC’s investor funds being misappropriated to pay for personal expenses of ITEC’s control persons and business expenses of entities that provided no services or other benefit to ITEC... Read More
Respondent: 1 Global Capital, LLC, Carl Ruderman, et al.
Violation: Defrauding at least 3,400 retail investors, more than one-third of whom invested their retirement funds. The Florida-based cash advance company and former CEO Carl Ruderman allegedly fraudulently raised more than $287 million since 2014 in unregistered securities sold through a network that included barred brokers... Read More
Respondent: Chad Anthony Lewis
Violation: Between September 2013 and July 2016, Lewis worked at different times both for Aegis Oil, LLC and 7S Oil & Gas, LLC, and offered and sold securities in connection with the respective offerings... Read More
Respondent: Application - John A. Henderson and Global Resources Leadership, LLC
Violation: Respondents John r1. Henderson ("Henderson") and CJlobal Resources Leadership, LLC ("GRL") have failed and refused to compl~~ ~Uith subpoenas issued b5~ t~~e United States Securities and Exchange Commission ("SEC") in connection with its formal investigation into potential violations of the fedeial securities laws, including possible violations of Sections 5(a), 5(c) end "17(a) of t~1e Securities Act of 1933 and Section 10(b) of the Securities Eschang~ Act of 1934 and Rule 10b-5 promulgated thereunder... Read More
Respondent: SEC Complaint - 1 Global Capital, LLC, Carl Ruderman, et al.
Violation: The Commission brings this action as the result of a four-year-long unregistered securities offering fraud conducted by Defendant 1 Global Capital LLC, and overseen by Defendant Carl Ruderman, that victimized thousands of investors nationwide, many of whom used their retirement savings to invest... Read More
Penalties: $7,927,160.76
Respondent: Credit Suisse Securities (USA) LLC and Sanford Michael Katz - Distribution Plan
Violation: Credit Suisse’s disclosures did not adequately inform its advisory clients of the conflict of interest presented by its RMs’ share class selection practices or update or enhance its policies or procedures to address this issue... Read More
Violation: By order dated June 30, 2017, the Commission issued the “Omnibus Order Directing the Appointment of Tax Administrator in Administrative Proceedings that Establish Distribution Funds” (“Omnibus Order”),1 authorizing the Secretary to issue orders beginning June 2017 and for calendar year 2018 appointing, upon request by the Commission staff, Miller Kaplan Arase LLP... Read More
Respondent: Credit Suisse Securities (USA) LLC and Sanford Michael Katz
Violation: Katz’s practice of putting advisory clients in Class A shares when those clients were eligible for less expensive institutional share classes resulted in Credit Suisse collecting approximately $3.2 million in 12b-1 fees, approximately $1.1 million of which was paid to Katz... Read More
Respondent: Huntington Bancshares, Inc., et al.
Violation: In the Order, the Commission found that Huntington violated the federal securities laws by overstating its 2001 and 2002 operating earnings and that had it not been for the misstatements, Huntington's reported operating earnings per share for 2001 and 2002 would have been short of analyst expectations... Read More
Penalties: $581,170.00
Respondent: Amer Deeba
Violation: When Qualys publicly announced its financial results, it reported that it had missed its previously-announced firstquarter revenue guidance and that it was revising its full-year 2015 revenue guidance downward. On the same day, Deeba sent a message to one of his brothers saying, "We announced the bad news today." The next day, Qualys's stock price dropped 25%. Although Deeba made no profits from his conduct, Deeba's brothers collectively avoided losses of $581,170 by selling their Qualys stock... Read More
Penalties: $10,231,157.00
Violation: From at least July 2011 to December 2012, Visium, through two of its portfolio managers, engaged in a mismarking scheme, using sham broker quotes to falsely inflate the value of securities held by a fund for which Visium acted as investment adviser (the “Credit Fund”)... Read More
Respondent: SEC Complaint - Amer Deeba
Violation: Deeba tipping his brothers with material nonpublic information, both brothers sold all of their Qualys shares ahead of the announcement and avoided losses of $456,636 and $124,534, respectively... Read More
Violation: In 2014, Walter Grenda sold his investment advisory assets, including his longstanding client base, to Grenda Group, LLC and his son, Gregory Grenda, in anticipation of a negative outcome in an SEC fraud investigation... Read More
Respondent: Philip R. Jacoby, Jr.
Violation: The Securities and Exchange Commission deems it appropriate to issue an order of forthwith suspension of Philip R. Jacoby, Jr. pursuant to Rule 102(e)(2) of the Commission’s Rules of Practice [17 C.F.R. § 201.102(e)(2)]... Read More
Penalties: $1,900,000.00
Respondent: Massachusetts Financial Services Company
Violation: This matter arises from material misstatements and omissions by registered investment adviser MFS to certain of its advisory clients and others concerning hypothetical stock returns associated with MFS’s blended research stock ratings. In 2001, MFS introduced its blended research strategies to investors. The blended research strategies combine research ratings from MFS’s fundamental analysts and quantitative models to manage portfolios of stocks for client investment... Read More
Respondent: Bruce A. Broekhuizen
Violation: From at least 2008 to the present, Broekhuizen purchased new issue municipal bonds in primary offerings from underwriters, which he then immediately sold, or “flipped” to broker-dealer customers for a profit... Read More