Financial Enforcement Actions | Week of July 20 to July 26

Financial-Enforcement-Actions-Week-of-July-20-to-July-26

Financial-Enforcement-Actions-Week-of-July-20-to-July-26

FINRA

12 Enforcement Documents

$40,000.00 in Fines

Penalties: $5,000.00
Respondent: Michael David Garris
Violation: In October and November, 2017, Respondent effected 26 unauthorized transactions in a deceased customer’s account in violation of FINRA Rule 2010… Read More

Penalties: $7,500.00
Respondent: Brian Gregory DiJulio
Violation: DiJulio violated NASD Rule 2510(b) and FINRA Rule 2010. DiJulio also failed to mark the Relevant Transactions as entered pursuant to the exercise of discretion and mismarked the trades as unsolicited. As a result, DiJulio violated FINRA Rules 4511(a) and 2010… Read More

Penalties: $5,000.00
Respondent: Aaron Williams
Violation: On November 27, 2018, while associated with Goldman Sachs, Williams possessed a prohibited device while taking the Securities Industry Essentials (“SIE”) examination, in violation of FINRA Rule 2010… Read More

Penalties: N/A
Respondent: Robert F. Montes
Violation: In connection with an investigation into whether Montes potentially misused customer assets, FINRA staff issued Montes a request to provide documents and information pursuant to FINRA Rule 8210. Montes refused to provide the documents and information, thereby violating FINRA Rules 8210 and 2010… Read More

Penalties: N/A
Respondent: Ernie Garcia
Violation: Garcia violated FINRA Rules 8210 and 2010 by failing to provide documents, information, and on-the-record testimony, as requested pursuant to FINRA Rule 8210. In response to a request for documents, information and on-the-record testimony pursuant to FINRA Rule 8210, Respondent did not provide the information and documents requested, and refused to appear for testimony… Read More

Penalties: N/A
Respondent: Stephen Michael Whiting
Violation: By falsifying three attestation forms and altering a wire transfer request form, Whiting violated F ENRA Rule 2010. In addition, Whiting violated FINRA Rules 4511 and 2010 by causing Concorde to maintain inaccurate books and records… Read More

Penalties: N/A
Respondent: Alpine Securities Corporation
Violation: Alpine misused customer assets in violation of FINRA Rules 2150 and 2010, both by virtue of its violation of Rule 2150 and independently. Alpine charged unfair prices and commissions in violation of FINRA Rules 2121 and 2010. Alpine effected unapproved capital withdrawals in violation of FINRA Rules 4110(c)(2) and 2010…. Read More

Penalties: N/A
Respondent: Michael P. Spolar
Violation: Spolar exercised discretion without written authorization in effecting four securities trades, in violation of NASD Rule 2510(b) and FINRA Rules 2360(b)(18)(A) and 2010. In addition, in connection with the three options securities trades, Spolar mismarked the trades as “unsolicited” and submitted falsified “Unsolicited Options Letter” forms to his employer member firm in connection with the trades, in violation of FINRA Rules 4511 and 2010… Read More

Penalties: N/A
Respondent: Louis Mark Miller
Violation: Miller failed to provide the information requested by the Questionnaire and his testimony in connection with a FINRA investigation, in violation of FINRA Rules 8210 and 2010… Read More

Penalties: $12,500.00
Respondent: Michael Thomas Lee
Violation: Lee engaged in an outside business activity, the Origin Fund, without providing prior written notice to Kestra, in violation of FINRA Rules 3270 and 2010. Lee also distributed written materials to potential investors that contained inaccurate statements about the Origin Fund, in violation of FINRA Rule 2010… Read More

Penalties: $10,000.00
Respondent: Richard O. White
Violation: White violated FINRA Rule 2010 when he structured cash deposits to evade the federal currency reporting requirements of the Bank Secrecy Act… Read More

Penalties: N/A
Respondent: Joseph Scott Eckhoff
Violation: Eckhoff violated FINRA Rules 8210 and 2010 by not providing certain documents and information requested pursuant to FINRA Rule 8210… Read More

SEC

31 Enforcement Documents

$17,752,511.92 in Fines

Penalties: $16,565,150.92
Respondent: Microsoft Corporation
Violation: Microsoft violated Section 13(b)(2)(A) of the Exchange Act, which requires issuers to make and keep books, records and accounts which, in reasonable detail, accurately and fairly reflect their transactions and dispositions of the assets of the issuer. Microsoft also violated Section 13(b)(2)(B) of the Exchange Act, which requires issuers to devise and maintain a system of internal accounting controls sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary… Read More

Penalties: $85,537.00
Respondent: Balaji Sundarraj and David O’Brien,
Violation: Respondents each violated Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, which prohibit fraudulent conduct in connection with the purchase or sale of securities… Read More

Penalties: N/A
Respondent: Quantumsphere, Inc. and Shenzhen Yidian Double Way of Innovation Culture Media Corp.,
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. Respondents failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder… Read More

Penalties: N/A
Respondent: Gold Lakes Corp. and Novagen Ingenium 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. Respondents failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder… Read More

Penalties: N/A
Respondent: American Smooth Wave Ventures, Inc.,
Violation: Respondent fails to file the directed Answer, or fails to appear at a hearing or conference after being duly notified, the Respondents, and any successor under Exchange Act Rules 12b-2 or 12g-3, and any new corporate names of the Respondent, may be deemed in default and the proceedings may be determined against them upon consideration of this Order, the allegations of which may be deemed to be true as provided by Rules 155(a), 220(f), 221(f), and 310 of the Commission’s Rules of Practice, 17 C.F.R. §§ 201.155(a), 201.220(f), 201.221(f), and 201.310… Read More

Penalties: N/A
Respondent: Enhanced Services Company, Inc. and Ingenex, 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. Respondents failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder… Read More

Penalties: $75,000.00
Respondent: N. Gary Price
Violation: Price willfully violated Section 206(2) of the Advisers Act, which prohibits fraudulent conduct by an investment adviser. Proof of scienter is not required to establish a violation of Section 206(2). SEC v. Steadman, 967 F.2d 636, 643 n.5 (D.C. Cir. 1992) (citing SEC v. Capital Gains Research Bureau, Inc., 375 U.S. 180, 195 (1963))… Read More

Penalties: $50,000.00
Respondent: Foundations Asset Management, LLC, Michael W. Shamburger, and Rob E. Wedel
Violation: FAM willfully violated, and Shamburger and Wedel caused FAM’s violations of, Section 206(2) of the Advisers Act. Proof of scienter is not required to establish a violation of Section 206(2). SEC v. Steadman, 967 F.2d 636, 643 n.5 (D.C. Cir. 1992) (citing SEC v. Capital Gains Research Bureau, Inc., 375 U.S. 180, 195 (1963))… Read More

Penalties: N/A
Respondent: Capital Trust Holdings, Inc., Florida Gaming Corporation, and Go Public, 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. Respondents failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder… Read More

Penalties: $75,000.00
Respondent: BKS Advisors, LLC
Violation: The Plan provides for distribution of the Net Fair Fund5 to investors who were harmed as a result of Denha’s and BKS’s fraudulent allocation or “cherry-picking” scheme and who suffered losses as calculated by the methodology described in paragraph 11 of the Plan… Read More

Penalties: N/A
Respondent: Sohin S. Shah
Violation: Pursuant to Section 15(b)(6) of the Exchange Act Respondent Shah be, and hereby is barred from participating in any offering of a penny stock, including: acting as a promoter, finder, consultant, agent or other person who engages in activities with a broker, dealer or issuer for purposes of the issuance or trading in any penny stock, or inducing or attempting to induce the purchase or sale of any penny stock… Read More

Penalties: $50,000.00
Respondent: Robert L. Baker, Jacob B. Herrera, Michael D. Bowen, and Terrence A. Ballard
Violation: Respondents willfully violated Section 15(a) of the Exchange Act and Sections 5(a) and 5(c) of the Securities Act… Read More

Penalties: $75,000.00
Respondent: BKS Advisors, LLC
Violation: The Plan provides for distribution of the Net Fair Fund5 to investors who were harmed as a result of Denha’s and BKS’s fraudulent allocation or “cherry-picking” scheme and who suffered losses as calculated by the methodology described in paragraph 11 of the Plan… Read More

Penalties: $15,000.00
Respondent: Chua Seong Seng
Violation: Chua willfully violated Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, which prohibit fraudulent conduct in connection with the purchase or sale of securities… Read More

Penalties: $736,824.00
Respondent: Timothy M. Rooney, SR
Violation: Rooney willfully violated Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, which prohibit fraudulent conduct in connection with the purchase or sale of securities… Read More

Penalties: N/A
Respondent: Bingo Nation, Inc., Sino-American Net Media Corp., and Wussler Worldwide Media Co
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. Respondents failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder… Read More

Penalties: N/A
Respondent: Mariposa Health, Inc. and STL Marketing Group, 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. Respondents failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder… Read More

UK-FCA

9 Enforcement Documents

£31,458,000.00 in Fines

Penalties: £214,300.00
Respondent: Jin-Yi Lee
Violation: Mr Lee was knowingly concerned in a number of breaches by Cathay International Holdings Limited (“Cathay”) of the Listing Principles and Disclosure Rules and Transparency Rules… Read More

Penalties: £30,792,500.00
Respondent: Standard Life Assurance Limited
Violation: Action against Standard Life for breaches of Principle 3 (Management and Control) and Principle 6 (Customers’ Interests) of the Authority’s Principles for Businesses (the Principles) that occurred between 1 July 2008 and 31 May 2016 (the Relevant Period) in relation to non-advised sales of annuities to existing customers who were approaching retirement and who may have been eligible for an enhanced annuityRead More

Penalties: £40,200.00
Respondent: Eric Ka Chi Siu
Violation: Mr Siu was a director and FD of Cathay at all material times and, by virtue of that role and his knowledge of, and involvement in, the matters which gave rise to Cathay’s breach, he was knowingly concerned in the breach of Listing Principle 2 throughout the 2016 Relevant Period. Mr Siu was responsible for drafting the correspondence with the Authority and knew that the information being provided was not a contemporaneous record of events… Read More

Penalties: £411,000.00
Respondent: Cathay International Holdings Limited
Violation: Cathay failed to disclose to the market as soon as possible on or shortly after 6 December 2015 a material change in its actual and expected financial performance for the year ending 31 December 2015 when, as a result of the deterioration of Cathay’s performance, Cathay was aware of circumstances in which there was projected to be a 56% deviation from market expectations of the loss after tax1. Cathay therefore breached DTR 2.2.1R… Read More

Penalties: N/A
Respondent: Potters Music Shop(Croydon)Limited
Violation: PMSCL has failed to comply with the regulatory requirement to submit the Return. PMSCL has not been open and co-operative in all its dealings with the Authority, in that PMSCL 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: Vale Veterinary Group
Violation: VVG has failed to comply with the regulatory requirement to submit the Return. VVG has not been open and co-operative in all its dealings with the Authority, in that VVG 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: Pitstop Motors (Swindon) Limited
Violation: PMSL has failed to comply with the regulatory requirement to submit the Return. PMSL has not been open and co-operative in all its dealings with the Authority, in that PMSL 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: Prindiville Plc
Violation: PP is failing to satisfy the suitability Threshold Condition, in that the Authority is not satisfied that PP is a fit and proper person having regard to all the circumstances, including whether PP managed its business in such a way as to ensure that its affairs were conducted in a sound and prudent manner…. Read More

Penalties: N/A
Respondent: Andrew Morris Cars Ltd
Violation: AMCL has failed to comply with the regulatory requirement to submit the Return. AMCL has not been open and co-operative in all its dealings with the Authority, in that AMCL 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

FTC

10 Enforcement Documents

$275,085,060.00 in Fines

Penalties: N/A
Respondent: Equifax, Inc
Violation: “Defendant engaged in acts or practices in violation of Section 5 of the FTC Act, 15 U.S.C. § 45, and the Standards for Safeguarding Customer Information Rule (“Safeguards Rule”), 16 C.F.R. Part 314, issued pursuant to Sections 501(b) and 505(b)(2) of the GrammLeach-Bliley Act (“GLB Act”), and 15 U.S.C. §§ 6801(b) and 6805(6b)(2), by failing to reasonably secure sensitive consumer personal information in Defendant’s networks and computer systems… Read More

Penalties: N/A
Respondent: Quaker Chemical Corporation, Global Houghton LTD. Gulf Houghton Lubricants LTD. AMAS Holding SPF
Violation: Respondents that the law has been violated as alleged in the Draft Complaint, or that the facts as alleged in the Draft Complaint, other than jurisdictional facts, are true… Read More

Penalties: $275,000,000.00
Respondent: Equifax
Violation: Equifax failed to implement basic security measures, according to the complaint. This includes failing to implement a policy to ensure that security vulnerabilities were patched; failing to segment its database servers to block access to other parts of the network once one database was breached; and failing to install robust intrusion detection protections for its legacy databases. In addition, the FTC also alleges that Equifax stored network credentials and passwords, as well as Social Security numbers and other sensitive consumer information, in plain text… Read More

Penalties: N/A
Respondent: Equifax, Inc
Violation: Defendant failed to segment the database servers connected to ACIS, a failure that permitted the attackers to easily gain access to vast amounts of information related to a broad variety of Equifax consumer products and services. The attackers did not need complex or advanced tools to pivot across Defendant’s network… Read More

Penalties: N/A
Respondent: Cambridge Analytica, LLC
Violation: Cambridge Analytica represented, directly or indirectly, expressly or by implication, that the GSRApp did not collect any identifiable information from Facebook users who authorized the app. GSRApp collected identifiable information from Facebook users who authorized the App, including the Facebook User ID of those users who used it… Read More

Penalties: $42,530.00
Respondent: Facebook, Inc.
Violation: “Facebook failed to disclose, or failed to disclose adequately, that Facebook would also use phone numbers provided by users for two-factor authentication for targeting advertisements to those users. Facebook as alleged in this Complaint constitute unfair or deceptive acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act, 15 U.S.C. § 45(a)”… Read More

CFPB

3 Enforcement Documents

$700,000,000.00 in Fines

Penalties: $700,000,000.00
Respondent: Equifax, Inc.
Violation: Equifax, Inc. engaged in unfair and deceptive practices in connection with the 2017 data breach of Equifax’s systems that impacted approximately 147 million consumers… Read More

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