Weekly Enforcement Action Tracker (May 06 – May 11)

Financial Enforcement Action Summary

FTC

Penalties: N/A
Respondent: Wilhelm Wilhelmsen
Violation: Wilhelmsen Maritime Services’ proposed $400 million acquisition of Drew Marine Group would violate the antitrust laws by significantly reducing competition in an important market for marine water treatment chemicals and services used by global fleets… Read More

Penalties: N/A
Respondent: Capital Home Advocacy Center
Violation: Deceiving distressed homeowners by falsely promising to make their mortgages more affordable and prevent foreclosure… Read More

SEC

$17,657,443.86 in Fines

Penalties: N/A
Respondent: Paul W. Smith
Violation: Smith devised or intended to devise a scheme to defraud investors in Haverford and obtain money and property by means of false and fraudulent pretenses, representations, and promises in connection with the purchase and sale of securities… Read More

Penalties: $125,000.00
Respondent: Anthony Coronati and Bidtoask, LLC
Violation: On February 22, 2017, the Securities and Exchange Commission (“Commission”) published a Notice of Proposed Plan of Distribution and Opportunity for Comment (“Notice”), 1 pursuant to Rule 1103 of the Commission’s Rules on Fair Fund and Disgorgement Plans (“Commission’s Rules”), 2 for the distribution of the Fair Fund in this administrative proceeding… Read More

Penalties: N/A
Respondent: Keith Houlihan
Violation: Respondent conspired to defraud investors and obtain money and property by means of materially false and misleading statements… Read More

Penalties: $10,520,634.00
Respondent: Murakami
Violation: Murakami misappropriated more than $8 million for business and personal expenses and made approximately $1.3 million in Ponzi-like payments… Read More

Penalties: N/A
Respondent: SEC Complaint – Bovorn Rungruangnavarat
Violation: The SEC now charges that Bovorn, in concert with his brother Badin, used material, nonpublic information to purchase or cause to be purchased the Smithfield securities noted in the original action as well as 74,900 Smithfield shares in four additional accounts, not known at the time of the original action, that Bovorn and his brother controlled, reaping additional profits of approximately $560,000. In total, Bovorn and Badin generated illicit gains of approximately $3.8 million… Read More

Penalties: TBD
Respondent: Bovorn Rungruangnavarat
Violation: The SEC’s complaint alleges that in early May 2013, Bovorn Rungruangnavarat coordinated with his brother, Badin Rungruangnavarat, to acquire large volumes of call options, futures, and shares of Smithfield after learning of the potential acquisition from a close, personal friend who worked as an investment banker. According to the complaint, the brothers’ purchases were so aggressive that they acquired control over approximately 32.5% of the average daily trading volume of Smithfield stock during May 2013. After the planned acquisition was announced on May 29, 2013, they sold their position for profits of approximately $3.8 million… Read More

Penalties: N/A
Respondent: Baltia Air Lines Inc.
Violation: “All of the 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.”… Read More

Penalties: N/A
Respondent: Content Checked Holdings, e.Digital Corp. and Liberty Coal Energy Corp.
Violation: All of the 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… Read More

Penalties: $5,475,934.00
Respondent: Visium Asset Management, LP
Violation: From at least July 2011 to December 2012, Visium portfolio managers Christopher Plaford (“Plaford”) and Stefan Lumiere (“Lumiere”) engaged in a mismarking scheme… Read More

Penalties: $100,000.00
Respondent: Steven Ku
Violation: From at least July 2011 to December 2012, Plaford and Lumiere engaged in a mismarking scheme to inflate falsely the value of certain securities held by the Credit Fund… Read More

Penalties: TBD
Respondent: SEC Complaint – Premium Point Investments, LP
Violation: Defendant Premium Point, a Commission-registered investment adviser that managed billions of dollars in assets at its height, and the individual defendants engaged in a fraudulent scheme to inflate the value of securities—at times by more than 100%—held by several private investment funds Premium Point advised… Read More

Penalties: $947,575.86
Respondent: Barcelona Strategies, LLC and Mario Hinojosa
Violation: Barcelona as its municipal advisor, Barcelona and Hinojosa overstated and misrepresented their municipal finance experience to LJISD… Read More

Penalties: TBD
Respondent: SEC Complaint – Keith Houlihan
Violation: Defendant participated in a fraudulent scheme that raised approximately $21 million from approximately 700 investors, by: (1) directly soliciting prospective investors to purchase Sanomedics shares based on false statements; (2) hiring a boiler room to pitch Sanomedics’ stock to prospective investors using false statements regarding the price and limited number of Sanomedics shares being sold; (3) supporting the boiler room by paying sales agents undisclosed commissions; and (4) signing Sanomedics’ periodic filings with the Commission that contained materially false and misleading statements and omissions regarding Sanomedics’ use of an illegal boiler room to finance its operations… Read More

Penalties: TBD
Respondent: Premium Point Investments
Violation: Used “imputed” mid-point valuations, which were applied in a manner that further inflated the value of securities. This practice allegedly boosted the value of many of Premium Point’s MBS holdings and further exaggerated returns. The complaint alleges that the defendants overstated the funds’ value in order to conceal poor fund performance and attract and retain investors… Read More

Penalties: N/A
Respondent: Keith Houlihan
Violation: Hired and worked with an unregistered broker and his boiler room operation to illegally sell shares of Sanomedics by cold-calling the investing public using high-pressure sales tactics… Read More

Penalties: N/A
Respondent: Longwei Petroleum Investment Holding Limited
Violation: Longwei is delinquent in its reporting obligations under Section 13(a) of the Exchange Act. Longwei last filed an annual report on Form 10-K for its fiscal year ended June 30, 2012, on September 13, 2012, and a quarterly report on Form 10-Q for the quarter ended September 30, 2012 on November 13, 2012… Read More

Penalties: N/A
Respondent: Yasuna Murakami
Violation: Murakami misused investor assets to make payments to other individuals who had invested in earlier hedge funds managed by Murakami… Read More

Penalties: $338,300.00
Respondent: Jason J. Lee and Law Offices of Jason J. Lee & Associates
Violation: Respondents, an immigration attorney, and a law firm, recommended that their clients participate in the Immigrant Investor Program by investing in securities offered through an EB-5 Regional Center and helped effect the purchases. In addition to receiving legal fees from their clients, Respondents received a commission from the Regional Center for each investment they facilitated… Read More

Penalties: $150,000.00
Respondent: The Falls Event Center, LLC and Steven L. Down
Violation: Down solicited investments in The Falls by making presentations to groups of professionals during continuing education seminars that he sponsored. In his presentations, Down represented that some or all of the event centers were and continued to be profitable. The complaint alleges that certain of these representations to investors were untrue… Read More

Penalties: TBD
Respondent: Steven J. Dykes
Violation: Beginning no later than January 2013 and during the period of the offenses described in Paragraph II.B.2, Dykes acted as an unregistered broker or dealer and participated in an offering of restricted shares of stock in VIP TV, LLC, VIP Television Inc., and The Spongebuddy, LLC (collectively “VIP”), which are penny stocks. Dykes, who has never been registered or associated with a registered broker-dealer, cold-called investors and pitched investments in VIP. Dykes received a commission for the investments he successfully solicited… Read More

Penalties: N/A
Respondent: SEC Complaint – The Falls Event Center, LLC and Steven L. Down
Violation: Misrepresentations in the offer or sale of securities by The Falls and Down, its CEO and founder. Down has raised approximately $120 million from approximately 300 investors for The Falls since 2011… Read More

FINRA

$4,440,000.00 in Fines

Penalties: TBD
Respondent: Edwin Rodriguez, Arthur Tacopino, Imtiaz (Raana) Khan, Bruce Meyers and Windsor Street Capital, f/k/a Meyers Associates
Violation: The Firm and its principals allowed associated persons to fraudulently abuse Windsor Street’s average price, riskless principal, and bond inventory accounts (collectively, the “Firm Accounts”) in order to reap ill-gotten gains at the expense of Firm customers… Read More

Penalties: $5,000.00
Respondent: Fatou Camara
Violation: Camara failed to repay any portion of the borrowed funds… Read More

Penalties: $4,000,000.00
Respondent: Fifth Third Securities, Inc.
Violation: Violated FINRA Rule 2010 (just and equitable principles of trade — for failing to comply with a prior AWC and for negligent misstatements and omissions); FINRA Rules 2330(b) and (c) and 2010 (VA suitability); and NASD Rules 2821(d) and 2110, and FINRA Rules 2330(d) and (e) and 2010 (supervision and training regarding VA Exchanges)… Read More

Penalties: N/A
Respondent: Vaughn Lee Andrews-McKay
Violation: From January through October 2017, Andrews-McKay converted $47,748.19 from two Firm clients, thereby violating FINRA Rules 2150(a) and 2010… Read More

Penalties: N/A
Respondent: Stacy Cheney-Jamison
Violation: Cheney-Jamison, through her attorney, has acknowledged that she received FINRA’s request and that she will not respond to FINRA’s request at any time. By refusing to provide information and documents as requested pursuant to FINRA Rule 8210, Chency-Jamison violates FINRA Rules 8210 and 2010… Read More

Penalties: N/A
Respondent: Brian K. Decker
Violation: “By failing to produce information and documents as requested pursuant to FINRA Rule 8210, Decker violated FINRA Rules 8210 and 2010.”… Read More

Penalties: $5,000.00
Respondent: Philip O. Fatta
Violation: Between August 2014 and April 2016 (the “Relevant Period”), Fatta engaged in quantitatively unsuitable trading in the account of customer MW in violation of FINRA Rules 2111 and 2010… Read More

Penalties: N/A
Respondent: Norman R Sicard Jr.
Violation: Sicard failed to appear for on-the-record testimony requested by FINRA staff pursuant to FINRA Rule 8210. Through this conduct, Sicard violated FINRA Rules 8210 and 2010… Read More

Penalties: $5,000.00
Respondent: Nas Adel Allan and Windsor Street Capital, LP, f/k/a Meyers Associates, L.P
Violation: Respondent Nas Adel Allan (CRD No. 4562149), while registered through Respondent firm Windsor Street Capital, LP (which was known as Meyers Associates, L.P. until December 2016) (BD No. 34171)) (“Windsor Street” or the “Firm”), recommended, over an approximate two-month period, that elderly husband and wife customers IR and DR engage in short-term trading of a single security that they had held for over 36 years, resulting in losses and capital gains tax liability for IR and DR and generating over $22,000 in commissions, markups, and markdowns for Respondent… Read More

Penalties: $5,000.00
Respondent: Gregory J. Anastos, Nas Adel Allan and Windsor Street Capital, LP f/k/a Meyers Associates, L.P.
Violation: Respondent Nas Adel Allan (CRD No. 4562149), while registered through Respondent firm Windsor Street Capital, LP (which was known as Meyers Associates, L.P. until December 2016) (BD No. 34171)) (“Windsor Street” or the “Firm”), recommended, over an approximate two-month period, that elderly husband and wife customers IR and DR engage in short-term trading of a single security that they had held for over 36 years, resulting in losses and capital gains tax liability for IR and DR and generating over $22,000 in commissions, markups, and markdowns for Respondent… Read More

Penalties: N/A
Respondent: Brandon Carl Rudolph
Violation: In 2018, Rudolph refused to provide information requested by FINRA staff pursuant to FINRA Rule 8210. Rudolph thereby violated FINRA Rules 8210 and 2010… Read More

Penalties: N/A
Respondent: Amy Pesina
Violation: Pesina has acknowledged that she received FINRA’s request and that she will not appear for on-the-record testimony at any time. By refusing to appear for on-the-record testimony as requested pursuant to FINRA Rule 8210, Pesina violates FINRA Rules 8210 and 2010… Read More

Penalties: $400,000.00
Respondent: Barclays Capital Inc.
Violation: The Firm failed to report and inaccurately reported OTC options positions to the LOPR in millions of instances,’-and for certain customer accounts, exceeded position limits in several different securities. In addition. the Firm failed to establish and maintain adequate supervisory procedures, including written supervisory procedures, by failing to implement an adequate system of follow-up and review reasonably designed to ensure compliance with applicable position limits and LOPR reporting obligations… Read More

Penalties: N/A
Respondent: James E. Knee
Violation: Knee declined to appear for the requested testimony and stated, through his lawyer, that he will not participate in FINRA’s investigation, in violation of FINRA Rules 8210 and 2010… Read More

Penalties: $5,000.00
Respondent: Robert N. Newman
Violation: From October 2013 through February 2015, Newman exercised discretion in one customer’s account without prior written authorization from the customer or approval by his member firm, in violation of NASD Rule 2510(b) and FINRA Rule 2010… Read More

Penalties: N/A
Respondent: Emil J. Skyba
Violation: By refusing to respond to FINRA’s requests pursuant to FINRA Rule 8210, Skyba violated FINRA Rules 8210 and 2010… Read More

Penalties: N/A
Respondent: Gregory J. Anastos
Violation: Respondent Gregory J. Anastos (CRD No. 5800831), while registered through Respondent firm Windsor Street Capital, LP (which was known as Meyers Associates, L.P. until December 2016) (BD No. 34171)) (“Windsor Street” or the “Firm”), recommended, over an approximately 13-month period, that elderly husband and wife customers IR and DR engage in short-term trading of a single security that they had held for over 36 years, resulting in significant losses for IR and DR and generating over $78,158 in commissions, markups, and markdowns for Respondent… Read More

Penalties: $15,000.00
Respondent: Kelly Marvin Barnett
Violation: While registered with MSI Financial Services, Barnett used discretion in the accounts of five customers without written authorization or acceptance of the accounts as discretionary accounts in violation of NASD Rule 2510(b) and FINRA Rule 2010. In addition, Barnett falsified notes of client contact in violation of FINRA Rule 2010 and falsified exchange forms, causing the Firm to maintain inaccurate books and records in violation of FINRA Rules 4511 and 2010… Read More

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