Financial Enforcement Actions | Week of August 24 to August 30

Financial-Enforcement-Actions-Week-of-August-24-to-August-30

Financial-Enforcement-Actions-Week-of-August-24-to-August-30

UK-FCA

5 Enforcement Documents

£0.00 in Fines

Penalties: N/A
Respondent: Music Matters Limited
Violation: MML has failed to comply with the regulatory requirement to submit the Return. MML has not been open and co-operative in all its dealings with the Authority, in that MML has failed to respond adequately to the Authority’s repeated requests for it to submit the Return, and has thereby failed to comply with Principle 11 of the Authority’s Principles for Businesses and to satisfy the Authority that it is ready, willing and organised to comply with the requirements and standards under the regulatory system… Read More

Penalties: N/A
Respondent: Savatori Leonard Oliverio
Violation: Savatori Oliverio is not a fit and proper person to perform any function in relation to any regulated activity carried on by any authorised person, exempt person or exempt professional firm, as his conduct has demonstrated a serious lack of honesty and integrity. Specifically, Savatori Oliverio was convicted, upon his own confession, on 25 October 2017 at Stoke on Trent Crown Count, of 1 count of “Conspire to Defraud” and 1 count of “Conspiracy to Apply False Trade Marks” contrary to section 1(1) of the Criminal Law Act 1977… Read More

Penalties: N/A
Respondent: Giovanni Joseph Oliverio
Violation: Giovanni Oliverio is not a fit and proper person to perform any function in relation to any regulated activity carried on by any authorised person, exempt person or exempt professional firm, as his conduct has demonstrated a serious lack of honesty and integrity. Specifically, Giovanni Oliverio was convicted, upon his own confession, on 25 October 2017 at Stoke on Trent Crown Court, of 1 count of “Conspiracy to Apply False Trade Marks” contrary to section 1(1) of the Criminal Law Act 1977… Read More

Penalties: N/A
Respondent: Tunstall Trade Car Sales Limited
Violation: Tunstall has failed to comply with Principle 11 (Relations with regulators), in that Tunstall has not been open and co-operative in all its dealing with the Authority. Tunstall is failing to satisfy the Threshold Condition in relation to its permitted regulated activities and accordingly the Authority considers that Tunstall’s Part 4A permission should be cancelled… Read More

FTC

2 Enforcement Documents

$81,484.00 in Fines

Penalties: $41,484.00
Respondent: Career Education Corporation, American Intercontinental University, Inc. AIU Online, LLC, Marlin Acquisition Corp, Colorado Tech., Inc., Colorado Technical University, Inc.
Violation: Defendants have provided substantial assistance or support to one or more lead generators even though Defendants knew or consciously avoided knowing that one or more such lead generators were engaged in violations of § 310.4 of the TSR. Defendants, therefore, have violated 16 C.F.R. § 310.3(b)… Read More

Penalties: $40,000.00
Respondent: Third Point Offshore Fund, Ltd, Third Point Ultra LTD, Third Point Partners Qualified LP, Third Point LLC
Violation: Each Defendant Fund violated the HSR Act’s notice and waiting requirements when it acquired voting securities of Dow DuPont Inc. (“Dow DuPont”) on August 31, 2017, as a result of the consolidation of Dow Chemical Company (“Dow”) and E.I du Pont de Nemours and Company (“DuPont”)…. Read More

FINRA

6 Enforcement Documents

$85,000.00 in Fines

Penalties: $80,000.00
Respondent: Innovation Partners LLC, Patrick Emanuel Sutherland, Yanique Lawrence
Violation: IP and Lawrence failed to establish, maintain and enforce a supervisory system reasonably designed to ensure that unregistered and/or statutorily disqualified individuals were not acting in a capacity that required registration or that individuals no longer registered with the broker-dealer did not have access to its systems… Read More

Penalties: N/A
Respondent: Jesse Gil
Violation: Gil provided false answers on compliance certifications concerning acting as power of attorney and providing outside financial advice to FC for compensation. These actions violated FINRA Rule 2010. Finally, Gil violated FINRA Rules 8210 and 2010 by failing to provide information and documents in response to two requests made by FINRA pursuant to FINRA Rule 8210… Read More

Penalties: $5,000.00
Respondent: Micah 0. Handell
Violation: In May 2017, Handell impersonated a prospective customer on two telephone calls with another FINRA member firm in order to obtain information about the prospective customer’s retirement accounts at the other firm, in violation of FINRA Rule 2010… Read More

Penalties: N/A
Respondent: Kari Ann Buckles
Violation: Buckles intentionally ceased payments rot over two years, leaving the withholdings in the agency’s operating account and using them to pay other expenses, including her own, personal expenses. By \ irtue of the foregoing, Buckles converted Funds in violation of FINRA Rule 2010 Additionally, Buckles failed to provide testimony requested by FINRA pursuant to FINRA Rule 8210. As a icsult, Buckles violated FINRA Rules 8210 and 2010… Read More

Penalties: N/A
Respondent: Craig A. Zabala
Violation: During the course of an ongoing examination, Zabala failed to provide documents and information requested by FINRA pursuant to FINRA Rule 8210. Zabala thereby violated FINRA Rules 8210 and 2010… Read More

Penalties: N/A
Respondent: Craig A. Zabala
Violation: During the course of an ongoing examination, Zabala failed to provide documents and information requested by FINRA pursuant to FINRA Rule 8210. Zabala thereby violated FINRA Rules 8210 and 2010… Read More

CFPB

6 Enforcement Documents

$900,000.00 in Fines

Penalties: $500,000.00
Respondent: Maxitransfers Corporation
Violation: Maxi failed to provide certain consumer protection disclosures and did not maintain all of the policies and procedures required under the “Remittance Transfer Rule” of the Electronic Fund Transfer Act (“EFTA”). Maxi also violated the Consumer Financial Protection Act of 2010 (“CFPA”) by stating to consumers that it was not responsible for errors made by its third-party payment agents when in fact under the Remittance Transfer Rule a provider is liable for any violation by an agent when such agent acts for the provider… Read More

Penalties: $200,000.00
Respondent: Asset Recovery Associates, Inc
Violation: ARA violated the Fair Debt Collection Practices Act by threatening to sue or arrest consumers even though it did not intend to take such action, falsely representing to consumers that company employees were attorneys, threatening to garnish consumers’ wages or place liens on their homes even though it did not intend to so do, and representing that consumers’ credit reports would be negatively affected if they did not pay, even though ARA does not report consumer debts to credit-reporting agencies… Read More

Penalties: $200,000.00
Respondent: Financial Credit Service, Inc., d/b/a Asset Recovery Associates
Violation: ARA violated the Fair Debt Collection Practices Act by threatening to sue or arrest consumers even though it did not intend to take such action, falsely representing to consumers that company employees were attorneys, threatening to garnish consumers’ wages or place liens on their homes even though it did not intend to so do, and representing that consumers’ credit reports would be negatively affected if they did not pay, even though ARA does not report consumer debts to credit-reporting agencies… Read More

SEC

58 Enforcement Documents

$206,932,314.80 in Fines

Penalties: N/A
Respondent: Biolog, Inc., Bozki, Inc., and China Gewang Biotechnology, Inc
Violation: Bozki has failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder because it has not filed any periodic reports with the Commission since the period ended January 19, 2017… Read More

Penalties: N/A
Respondent: Joseph C. Buchanan
Violation: Buchanan willfully violated Section 206(1) of the Advisers Act, which prohibits an investment adviser from employing “any device, scheme, or artifice to defraud any client or prospective client… Read More

Penalties: N/A
Respondent: 5BARz International, Inc., Eagle Mountain Corporation, and EFT Holdings, Inc.,
Violation: BARZ has failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder because it has not filed any periodic reports with the Commission since the period ended December 31, 2017… Read More

Penalties: N/A
Respondent: Jonathan Paltiel Flom
Violation: Flom has been convicted of a felony involving moral turpitude and has been suspended from the practice of law, both within the meaning of Rule 102(e)(2) of the Commission’s Rules of Practice… Read More

Penalties: N/A
Respondent: Laurel Wealth Advisors, Inc
Violation: LWA failed reasonably to supervise the IAR who engaged in cherry-picking and failed to implement policies and procedures reasonably designed to prevent violations of the Advisers Act and its rules. More specifically, LWA had a compliance procedure to prevent conflicts of interest that required IARs to pre-clear and obtain written approval before trading in their personal accounts, but LWA did not implement that procedure until January 2015… Read More

Penalties: N/A
Respondent: MMRGlobal, Inc., Silver Hill Mines, Inc., and Sterling Group Ventures, Inc.,
Violation: SGGV has failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder because it has not filed any periodic reports with the Commission since the period ended December 31, 2016… Read More

Penalties: N/A
Respondent: Hartman Wright Group, LLC and Tytus W. Harkins
Violation: According to the SEC’s complaint, investors received monthly interest payments, which were often paid using other investor funds. The complaint further alleges that Hartman Wright Group and Harkins overstated the purchase price on properties to hide fees Hartman Wright Group paid itself, failed to use investor money for the specific properties as represented, misrepresented amounts invested in properties, and overstated Hartman Wright Group’s financial position… Read More

Penalties: $317,415.10
Respondent: EMS Capital LP
Violation: EMS violated Section 204 of the Advisers Act and Rules 204-2(a)(3) and 204-2(a)(7)(iii) thereunder, which require registered investment advisers to make and keep true, accurate and current order memoranda and written communications for the purchase and sale of any security on behalf of a client by failing to make accurate order tickets. EMS’s order tickets and written communications to its broker inaccurately reflected the short sale orders as long orders. Accordingly, EMS violated Section 204 of the Advisers Act and Rules 204-2(a)(3) and 204-2(a)(7)(iii) thereunder… Read More

Penalties: N/A
Respondent: Michael A. Carroll, Michael V. Pappagallo, Steven A. Splain and Michael Mortimer.
Violation: Faced with announced guidance they could not achieve that defendants engaged in two year campaig to engineer the numbers they needed which they described and falsifying accounting entries to produce results that comported with the expectations Brixmor had set for investors… Read More

Penalties: N/A
Respondent: LD Holdings, Inc., Mansfield-Martin Exploration Mining, Inc., and RadTek, Inc
Violation: Respondents are delinquent in their periodic filings with the Commission, have repeatedly failed to meet their obligations to file timely periodic reports, and failed to heed delinquency letters sent to them by the Division of Corporation Finance requesting compliance with their periodic filing obligations or, through their failure to maintain a valid address on file with the Commission as required by Commission rules, did not receive such letters. As a result of the foregoing, Respondents failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder… Read More

Penalties: N/A
Respondent: Bakken Resources, Inc., Ireland Inc., and Worlds Mall, Inc.,
Violation: Respondents are delinquent in their periodic filings with the Commission, have repeatedly failed to meet their obligations to file timely periodic reports, and failed to heed delinquency letters sent to them by the Division of Corporation Finance requesting compliance with their periodic filing obligations or, through their failure to maintain a valid address on file with the Commission as required by Commission rules, did not receive such letters. As a result of the foregoing, Respondents failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder… Read More

Penalties: N/A
Respondent: RSM US LLP
Violation: RSM US failed to maintain an adequate independence quality control system. These failures resulted in repeated instances of unreasonable conduct in which RSM US violated the auditor independence rules. Consequently, RSM US engaged in improper professional conduct, as defined by Section 4C(a)(2) of the Exchange Act and Rule 102(e)(l)(ii) of the Commission’s Rules of Practice… Read More

Penalties: $7,000,000.00
Respondent: Michael A. Carroll, Michael V. Pappagallo, Steven A. Splain, and Michael Mortimer
Violation: The SEC’s complaint charges Carroll, Pappagallo, Splain, and Mortimer with violating or aiding and abetting violations of the antifraud and books and records provisions of the Securities Exchange Act of 1934, as well as with violating Rule 100(b) of Regulation G, which pertains to the reporting of nonGAAP performance measures. The complaint seeks permanent injunctions, disgorgement plus interest and penalties, and officer-and-director bars. Splain and Mortimer have agreed to the entry of partial judgments against them in which they consent to injunctive relief with other monetary relief and bars to be determined by the court in the future… Read More

Penalties: N/A
Respondent: Quantumsphere, Inc. and Shenzhen Yidian Double Way of Innovation Culture Media Corp
Violation: QSIM has failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder because it has not filed any periodic reports with the Commission since the period ended March 31, 2017… Read More

Penalties: N/A
Respondent: Veris Gold Corp
Violation: “Respondent is delinquent in its periodic filings with the Commission, has repeatedly failed to meet its obligation to file timely periodic reports, and failed to heed a delinquency letter sent to it by the Division of Corporation Finance requesting compliance with its periodic filing obligations or, through its failure to maintain a valid address on file with the Commission as required by Commission rules, did not receive such
letter. As a result of the foregoing, the Respondent failed to comply with Exchange Act Section 13(a) and Rule 13a-1 thereunder… Read More

Penalties: $338,467.39
Respondent: Howard C. Burns
Violation: Burns willfully violated Section 15(a)(1) of the Exchange Act, which makes it unlawful for any broker or dealer to use the mails or any means or instrumentality of interstate commerce “to effect any transactions in, or to induce or attempt to induce the purchase or sale of, any security” unless such broker or dealer is registered with the Commission in accordance with Section 15(b) of the Exchange Act… Read More

Penalties: N/A
Respondent: Bitqyck, Inc., Bruce E. Bise, and Samuel J. Mendez
Violation: Defendants violated, and unless enjoined will continue to violate, the antifraud, securities registration, and securities exchange registration provisions of the federal securities laws. In the interest of protecting the public from further violations of the federal securities laws, the SEC brings this action seeking permanent injunctive relief, disgorgement of ill-gotten gains plus prejudgment interest, civil penalties, and all other equitable and ancillary relief the Court deems necessary… Read More

Penalties: $8,236,181.67
Respondent: Cambridge Capital Group Advisors, LLC (f/k/a Cambridge Capital Advisors, LLC), Phillip Timothy Howard, and Don Warner Reinhard
Violation: Howard prepared the Reinhard Memo, making representations about the 2009 criminal case against Reinhard. Specifically, in the Memo, Howard represented that the charges were a tax deduction charge and an “incorrect bankruptcy charge.” He also represented that the tax deductions were supported by documentation and the bankruptcy attorney failed to correct the filings at issue in the criminal case. In the Memo, Howard goes on to vouch for Reinhard, stating that he trusts Reinhard with securities investments and that Reinhard has integrity… Read More

Penalties: N/A
Respondent: William Hutchinson a/k/a William Cluxton
Violation: Hutchinson made a number of material misrepresentations on Symulto’s website and in offering documents, including that Symulto was in the business of developing stored-value debit card services and software for international gaming and sports books; had operations all over the world; had sales of over $251 million and net income of over $86 million; and had been audited by a large, multi-national accounting firm. As alleged, all of these statements were false… Read More

Penalties: $11,745,018.00
Respondent: Juniper Networks, Inc.
Violation: Juniper violated Section 13(b)(2)(A) because its books and records, did not, in reasonable detail, accurately and fairly reflect certain expenses. Juniper violated Section 13(b)(2)(B) because it did not devise and maintain internal accounting controls over the approval processes for incremental discounting and travel that were sufficient to provide reasonable assurances that access to assets and transactions were executed in accordance with management’s authorization… Read More

Penalties: N/A
Respondent: Wendy Katz
Violation: Katz understood that when she obtained pre-released ADRs, ITG did not own the corresponding foreign shares and she did not take reasonable steps to determine whether the counterparties borrowing the pre-released ADRs owned the foreign shares. The result of this conduct was the issuance of ADRs that in many instances were not backed by ordinary shares as required for the relevant pre-release transaction. This conduct violated Section 17(a)(3) of the Securities Act of 1933 (“Securities Act”)… Read More

Penalties: $179,195,232.60
Respondent: Anthony Massaro
Violation: Massaro pled guilty to one count of conspiracy to commit mail and wire fraud in violation of Title 18, United States Code, Section 1349 before the United States District Court for the Eastern District of New York, in U.S. v. Anthony Massaro, Crim. No. 12-CR357. On February 24, 2017, a judgment in the criminal case was entered against Massaro… Read More

Penalties: N/A
Respondent: Cambridge Capital Group Advisors, LLC (f/k/a Cambridge Capital Advisors, LLC), et al
Violation: Reinhard, and Cambridge with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1), 206(2), and 206(4) of the Investment Advisers Act of 1940 (“Advisers Act”) and Rule 206(4)-8 thereunder, and Howard and Cambridge with also violating Section 207 of the Advisers Act… Read More

Penalties: $100,000.00
Respondent: Robin Smyth
Violation: Smyth has been convicted of a felony within the meaning of Rule 102(e)(2) of the Commission’s Rules of Practice. Accordingly, it is ORDERED, that Smyth is forthwith suspended from appearing or practicing before the Commission pursuant to Rule 102(e)(2) of the Commission’s Rules of Practice… Read More

Penalties: N/A
Respondent: Cetera Advisors, LLC
Violation: The SEC’s complaint also alleges that Cetera participated in a program offered by its clearing broker whereby it agreed to share with Cetera revenues and service fees it received from certain mutual funds. As a result, Cetera had an incentive to favor these mutual funds in the program over other investments when advising clients. The SEC’s complaint further alleges that Cetera directed its clearing broker to markup certain fees charged to Cetera’s advisory clients, which Cetera then received indirectly from these same clients… Read More

Penalties: N/A
Respondent: Live Well Financial, Inc., Michael C. Hild, Eric Rohr, and Darren Stumberge
Violation: The SEC’s complaint charges Live Well, Hild, Rohr, and Stumberger, with violations of the anti-fraud provisions of the federal securities laws. The complaint seeks a permanent injunction, disgorgement of ill-gotten gains along with prejudgment interest, financial penalties, and officer and director bars against Hild and Rohr. Stumberger and Rohr have consented to the entry of a partial judgment that permanently enjoins them from future violations of the charged provisions of the federal securities laws… Read More

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