Blog Posts Tagged With SEC

In re The Bank of New York Mellon (A.P. Dec. 17, 2018, Settled)

Action against Respondent, a financial services firm, in connection with an industry-wide sweep into practices related to the pre-release of American Depositary Receipts (ADRs).  According to the SEC, Respondent  pre-released ADRs to pre-release brokers pursuant to an agreement which required the broker receiving the pre-released ADRs to represent, among other things, that it beneficially owned the ordinary shares (or an equivalent security) represented by the ADRs.  The SEC alleges that Respondent should have known or
Continue Reading

In re UBS Financial Services Inc. (A.P. Dec. 17, 2018, Settled)

Action against Respondent, a broker-dealer, in connection with alleged failure to file Suspicious Activity Reports (SARs).  According to the SEC, Respondent failed to submit SARs related to money transfer services, despite red flags such as suspicious fund transfers and alerts generated by an internal monitoring system.  Respondent has agreed to pay a civil penalty of $5 million.  Respondent has separately agreed to pay $10 million to FINRA and FinCEN.

SEC Order 

SEC Administrative Summary
Continue Reading

SEC v. Peter Cho (S.D.N.Y. Dec. 17, 2018, Settled)

Action against Defendant, a banking consultant, for alleged insider trading.  According to the SEC, Defendant learned material nonpublic information about a pending acquisition from eavesdropping on his then-fiancée, an investment banker, and purchased call options while in possession of that information.  Defendant has agreed to pay disgorgement of $251,386, prejudgment interest of $26,405, and a civil penalty of $251,386.

SEC Litigation Release 

SEC Complaint
Continue Reading

In re NB Alternatives Advisers LLC (A.P. Dec. 17, 2018, Settled)

Action against Respondent, a registered investment adviser, for alleged Investment Advisers Act violations.  According to the SEC, Respondent charged three private equity fund clients for $2 million worth of employee time that was not actually spent providing services to the funds.  Respondent has agreed to pay disgorgement of $2,073,988, prejudgment interest of $284,620, and a civil penalty of $375,000.

SEC Order 

SEC Administrative Summary
Continue Reading

SEC v. Craig Arsenault, et al. (C.D. Cal. Dec. 13, 2018, Contested)

Action against Defendants, an investment adviser and his advisory firms, for alleged misrepresentations to investors and misappropriation of investor funds.  According to the SEC, Defendants falsely represented that funds would be invested in secured loans but instead put the funds towards riskier investments.  The SEC also alleges that Defendant adviser issued false account statements and misused investor funds.

SEC Litigation Release  

SEC Complaint
Continue Reading

SEC v. Hector A. May, et al. (S.D.N.Y. Dec. 13, 2018, Partially Settled, Partially Contested)

Action against Defendants, an investment adviser and his daughter, for alleged operation of a Ponzi scheme.  According to the SEC, Defendants used investor funds intended for investments in bonds for personal and business expenses and sent investors falsified account statements to conceal the scheme.  Defendant adviser has agreed to injunctive relief and monetary relief to be determined at a later date.  Parallel criminal charges have been filed against Defendant adviser.

SEC Press Release 

SEC Complaint
Continue Reading

In re Yucaipa Master Manager, LLC (A.P. Dec. 13, 2018, Settled)

Action against Respondent, a registered investment adviser, for alleged violations of the Investment Advisers Act.  According to the SEC, Respondent failed to disclose conflicts of interest related to third-party service provider agreements and certain administrative costs charged to Respondent’s funds.  The SEC also alleges that Respondent misallocated some of its costs.  Respondent has agreed to pay disgorgement of $1,863,242, prejudgment interest of $71,070, and a civil penalty of $1 million.

SEC Order  

SEC Administrative Summary
Continue Reading

In re America Modern Green Senior (Houston) LLC, et al. (A.P. Dec. 12, 2018, Settled)

Action against Respondents, three development companies organized to use EB-5 investor funds to finance development and construction projects, for alleged offering fraud.  According to the SEC, Respondents represented to investors that funds would be used to finance a real estate development project but instead used the funds for unrelated purposes.  Respondents have agreed to pay a total of $51,444,135.40 in disgorgement, prejudgment interest, and civil penalties.  $49.5 million of the disgorgement amount will be satisfied
Continue Reading

In re Landaas & Company and Robert W. Landaas (A.P. Dec. 12, 2018, Settled)

Action against Respondents, an investment adviser and broker-dealer and its owner and chairman, for alleged failure to disclose conflicts of interest.  According to the SEC, Respondents did not disclose that a clearing broker shared mutual fund revenues with Respondents and that Respondents kept portions of client fees paid to the broker.  The SEC further alleges that Respondents’ procedures were inadequate to ensure best execution.  Respondents have agreed to jointly and severally pay $408,483.06 in disgorgement,
Continue Reading

In re Lotus Bio-Technology Development Corporation (A.P. Dec. 11, 2018, Settled)

Action against Respondent, a biotechnology development company, for alleged violation of interim financial review requirements of Regulation S-X.  According to the SEC, Respondent filed a Form 10-Q with financial statements that had not been reviewed by an independent public accounting firm.  Respondent has agreed to a cease-and-desist order.  The SEC did not impose a civil penalty based on Respondent’s demonstrated inability to pay.  SEC Order
Continue Reading

In re The Hain Celestial Group, Inc. (A.P. Dec. 11, 2018, Settled)

Action against Respondent, an organic food and personal care product company, for alleged books and records and accounting controls violations.  According to the SEC, Respondent insufficiently documented sales incentives offered to distributors and failed to implement adequate policies and procedures related to documentation.  Respondent agreed to a cease-and-desist order.  The SEC did not impose a civil penalty due to Respondent’s self-reporting, remediation efforts, and cooperation.

SEC Order 

SEC Press Release
Continue Reading

In re Auscrete Corporation (A.P. Dec. 11, 2018, Settled)

Action against Respondent, a construction product manufacturer, for alleged violation of interim financial statement review requirements of Regulation S-X.  According to the SEC, Respondent filed three Forms 10-Q that included financial statements that had not been reviewed by an independent public accounting firm.  Respondent has agreed to a cease-and-desist order.  The SEC did not impose a civil penalty based on Respondent’s demonstrated inability to pay.

SEC Order
Continue Reading

In re Frontier Oilfield Services, Inc. (A.P. Dec. 11, 2018, Settled)

Action against Respondent, an oilfield fluid disposal corporation, for alleged violation of interim financial review requirements of Regulation S-X.  According to the SEC, Respondent filed a Form 10-Q with financial statements that had not been reviewed by an independent public accounting firm.  Respondent has agreed to pay a civil penalty of $25,000.

SEC Order
Continue Reading

In re Eastgate Biotech Corporation (A.P. Dec. 11, 2018, Settled)

Action against Respondent, a pharmaceutical company, for alleged violation of interim financial review requirements of Regulation S-X.  According to the SEC, Respondent filed three Forms 10-Q that included financial statements that had not been reviewed by an independent public accounting firm.  Respondent has agreed to a cease-and-desist order.  The SEC did not impose a civil penalty based on Respondent’s demonstrated inability to pay.

SEC Order
Continue Reading

In re Agria Corporation (A.P. Dec. 10, 2018, Settled)

Action against Respondent, an agricultural company, for alleged fraudulent accounting related to a 2010 divestiture.  According to the SEC, Respondent materially overstated the value of consideration received from the divestiture, thereby underreporting the loss it incurred on the transaction.  Respondent has agreed to pay a civil penalty of $3 million.

SEC Order 

SEC Press Release
Continue Reading

SEC v. Jared Jeffrey Davis and Dale Burke Pinchot (N.D. Ohio, Dec. 10, 2018, Settled)

Action against Defendants, two business partners, for alleged operation of  an unregistered binary options trading business and fraud on investors.  According to the SEC, Defendants misrepresented to investors the probability of success and failed to disclose that one Defendant manipulated its software to the detriment of customers.  Defendants have agreed to a permanent injunction against participating in the issuance, purchase, offer, sale, or promotion of any binary option security, and disgorgement and civil penalties to
Continue Reading

In re MUFG Securities Americas Inc. (A.P. Dec. 10, 2018, Settled)

Action against Respondent, a broker-dealer, for alleged incomplete and inaccurate regulatory filings.  According to the SEC, Respondent lacked adequate processes for validating the accuracy of the information provided in its electronic “blue sheets” submissions.  Respondent has agreed to pay a civil penalty of $1.4 million.

SEC Order 

SEC Press Release
Continue Reading

In re Lai Guanglin (Alan) (A.P. Dec. 10, 2018, Settled)

Action against Respondent, an executive chairman of an agricultural company, for alleged scheme to manipulate the market price of the company’s American Depositary Shares (“ADSs”).  According to the SEC, Respondent used brokerage accounts to engage in trading to inflate the company’s ADS price and made materially misleading statements about the company’s compliance with a New York Stock Exchange listing standard.  Respondent has agreed to a five-year officer-and-director bar and to pay a civil penalty of
Continue Reading

In re Citadel Securities LLC (A.P. Dec. 10, 2018, Settled)

Action against Respondent, a broker-dealer, for submission of incomplete or inaccurate data in response to SEC “electronic blue sheet” requests due to undetected coding and software issues.  According to the SEC, Respondent lacked adequate processes for validating the accuracy of the information provided in its blue sheet submissions.  Respondent has agreed to pay a civil penalty of $3.5 million.

SEC Order 

SEC Press Release
Continue Reading

In re CoinAlpha Advisors LLC (A.P. Dec. 7, 2018, Settled)

Action against Respondent, a corporate manager of an investment fund, for an alleged unregistered securities offering.  According to the SEC, Respondent raised money for a digital asset investment fund without filing a registration statement or obtaining an exemption and failed to ensure that its investors were accredited.  Respondent has agreed to pay a civil penalty of $50,000.

SEC Order
Continue Reading

SEC v. Rajeshwar R. Gannamaneni, et al. (S.D.N.Y. Dec. 6, 2018, Contested)

Action against Defendants—an investment bank IT contractor, his wife, and his father—for alleged insider trading.  According to the SEC, Defendants traded while in possession of material nonpublic information about upcoming mergers, acquisitions, and tender offers, which  Defendant contractor allegedly learned during his position at the investment bank and tipped the other two Defendants.

SEC Litigation Release 

SEC Complaint 

SEC Press Release
Continue Reading

In re KCAP Financial, Inc. (A.P. Dec. 4, 2018, Settled)

Action against Respondent, a business development company, for alleged improper recording and distribution of return-of-capital funds.  According to the SEC, Respondent failed to analyze the return-of-capital distributions it received in conformity with GAAP and instead improperly recorded and distributed those funds as dividends.  Respondent has agreed to a cease-and-desist order.

SEC Order 

SEC Administrative Summary
Continue Reading

LexBlog