Financial Enforcement Actions | Week of May 19 to May 24

Financial Enforcement Actions | Week of May 19 to May 24

Financial Enforcement Actions | Week of May 19 to May 24

Penalties: N/A
Respondent: Qualcomm Inc.
Violation: Using anticompetitive tactics to maintain its monopoly in the supply of a key semiconductor device used in cell phones and other consumer products… Read More

Penalties: N/A
Respondent: AlliedWallet, Inc, Allied Wallet, Ltd, GTBill, LLC, GTBill, Ltd, Ahmad Khawaja, Mohammad Diab, and Amy Rountree
Violation: Defendants have knowingly processed payments for numerous merchant-clients engaged in fraudulent activities, including merchants that have been subject to law enforcement actions by the FTC, the Securities Exchange Commission (“SEC”), and criminal authorities. Defendants have submitted merchant applications containing false information and actively worked with their reseller agents, Thomas Wells, and his company Priority Payout, to circumvent card network rules and transaction monitoring designed to prevent fraud. Because of Defendants’ unfair acts and practices, perpetrators of business opportunity and coaching scams, pyramid schemes, and unlawful debt collection operations gained access to the credit and debit card payment system and charged more than $110 million to consumer accounts… Read More

Penalties: N/A
Respondent: Payless Solutions
Violation: La FTC está enviando por correo 305 cheques por un total cercano a $315,000 a quienes pagaron comisiones por adelantado a Payless Solutions LLC por programas de reducción de tasa de interés sin valor alguno… Read More

Penalties: N/A
Respondent: Simple Comms Limited
Violation: SCL has failed to manage its business in such a way as to ensure that its affairs are conducted in a sound and prudent manner, that it is not a fit and proper person, and that it is, therefore, failing to satisfy the Threshold Conditions in relation to the regulated activities for which SCL was granted a Part 4A permission… Read More

Penalties: N/A
Respondent: Capital Financial Management Limited
Violation: Capital Financial Management Limited has: Agreed that the two cancellation charge terms had the potential to be considered unfair. It has amended these two terms to state that the maximum fee consumers will be charged on cancellation will not exceed the initial set-up fee plus one month’s service fee, less any amount already paid. Agreed that the term setting out the notice period had the potential to be unclear. It has deleted the term and amended the two cancellation charge terms to make clear… Read More

FINRA

8 Enforcement Documents

$333,217.52 in Fines

Penalties: N/A
Respondent: William Joseph Kielczewski
Violation: William Joseph Kielczewski falsely and repeatedly represented to the Firm that he was merely a passive investor in a hedge fund called Mariemont Capital Partners L.P. when, in fact, he was actively involved with Mariemont, promoting it to potential investors. Kielczewski participated in multiple private securities transactions through which four Firm customers invested over $10 million in Mariemont, without providing prior written notice to Huntington. Kielczewski willfully caused the Firm to make five false regulatory filings in which he described himself as a “passive investor” in Mariemont when he was not… Read More

Penalties: $30,949.52
Respondent: J. W. Korth & Company Lansing, MI
Violation: J. W. Korth violated MSRB Rules G-30 and G-17 by charging excessive markups in 38 sales of municipal securities and violated NASD Rule 2440, NASD IM-2440, and FINRA Rule 2010 by charging excessive markups in nine sales of corporate debt securities and excessive markdowns in four purchases of corporate debt securities… Read More

Penalties: $243,000.00
Respondent: Frank Harmon Black and Southeast Investments, N.C., Inc.
Violation: A member and its president testified falsely during an on-the-record interview; provided FINRA with fabricated documents; failed to retain business-related electronic communications; and failed to exercise reasonable supervision to prevent the failure to inspect offices and retain business-related emails… Read More

Penalties: N/A
Respondent: Thomas Leroy Studer
Violation: After receiving a request for testimony issued by FINRA staff under FINRA Rule 8210, Studer represented to FINRA staff that he does not intend to appear for testimony or otherwise cooperate with FINRA’s investigation… Read More

Penalties: $5,000.00
Respondent: Lisa Jeanne Lastrapes
Violation: During the period of November 2016 to October 2017, Lastrapes’ adult daughter was named as the beneficiary of a Firm customer’s IRA account, and from August 2017 to October 2017, the Firm customer named Lastrapes as medical power of attorney (“MPOA”). Lastrapes did not disclose these appointments to Merrill Lynch, in violation of FINRA Rule 2010… Read More

Penalties: $29,268.00
Respondent: J. W. Korth & Company
Violation: Respondent firm charged excessive markups on sales of municipal and corporate bonds, and excessive markdowns on purchases of corporate bonds… Read More

Penalties: $25,000.00
Respondent: Robert L. Harger, Jr., Christopher Michael Dowden
Violation: During the period March 2010 through October 2016 (“Relevant Period”), Harger permitted customers to sign without date partially completed Variable Annuity (“VA”) Exchange Forms. Subsequently, Harger entered the missing information before submitting the forms to Dowden, the designated supervising principal, for review and approval of the proposed transactions. Dowden then wrote in a date next to the applicable customer’s undated signature using the date he approved the transaction… Read More

Penalties: N/A
Respondent: Michael Anthony Bastardi
Violation: Bastardi refused to provide documents and information requested pursuant to FINRA Rule 8210. As a result, Bastardi violated FINRA Rules 8210 and 2010… Read More

SEC

33 Enforcement Documents

$26,370,487.00 in Fines

Penalties: $11,145,487.00
Respondent: Andrew I. Farmer ; Scott R. Sieck ; Eddie D. Austin ; Jr., Carolyn P. Austin ; John D. Brotherton
Violation: Defendants engaged in a pattern of obtaining control of all the freely trading stock of a penny stock and then allocating the stock to foreign and domestic front companies they controlled. To create the false appearance of market interest in the penny stock and to set artificially elevated share prices, Defendants allegedly conducted coordinated trading between these front companies… Read More

Penalties: N/A
Respondent: Andrew I. Farmer; Eddie D. Austin, Jr.; Scott R. Sieck; Carolyn P. Austin; John D. Brotherton
Violation: Defendants Farmer, Eddie Austin, Sieck, Carolyn Austin and Brotherton, acting knowingly, recklessly, and negligently, in the offer or sale of one or more of Puget, Gankit, Nhale, Horizon, and Valmie securities, by use of the means or instruments of transportation or communication in interstate commerce or of the mails, directly or indirectly… Read More

Penalties: N/A
Respondent: Tracson McLeod
Violation: McLeod was receiving compensation for work performed on behalf of one or more of the parties engaging in these securities transactions, including an individual who has been the subject of prior SEC enforcement actions and who, as a result of those prior actions, has been permanently barred from participating in offerings of penny stock and from association with any broker-dealer… Read More

Penalties: $15,025,000.00
Respondent: UBS Financial Services Incorporated of Puerto Rico; Ramiro L. Colon, III
Violation: UBSPR, through Colon, violated Section 15(b)(4)(E) of the Securities Exchange Act of 1934 (“Exchange Act”) by failing to supervise Jose Ramirez, Jr., a registered representative and associated person of UBSPR and UBSPR’s Guaynabo branch, who engaged in conduct that violated the anti-fraud provisions of Section 17(a) of the Securities Act of 1933 (“Securities Act”) and Section 10(b) of the Exchange Act and Rule 10b-5… Read More

Penalties: N/A
Respondent: David N. Osegueda ; Ishmail Calvin Ross ; aka Calvin Ross ; Zachary R. Logan ; Jessica Snyder ; fka Jessica Gutierrez
Violation: Ishmail Calvin Ross of Canoga Park, California secured – but hid – his control of Green Cures behind a figurehead CEO and a front company created by Ross and Jessica Snyder of Avondale, Arizona. At the same time, David N. Osegueda of Sun Valley, California allegedly sold Ross portions of convertible promissory notes, which documented debts owed by Green Cures that could be repaid with the company’s stock… Read More

Penalties: N/A
Respondent: Marcus Bradford Bray
Violation: Bray, through Bradford Solutions, offered and sold Woodbridge securities. None of Woodbridge’s securities offerings were registered with the Commission. Bray sold investors two primary types of securities:… Read More

Penalties: N/A
Respondent: Andrew G. Costa
Violation: Costa, through Costa Financial, offered and sold Woodbridge securities. Neither Costa Financial, Costa, nor Woodbridge were Commission-registered broker-dealers, nor were they associated with Commission-registered broker-dealers, and none of Woodbridge’s securities offerings were registered with the Commission. Costa sold investors two primary types of securities… Read More

Penalties: $200,000.00
Respondent: Howard M. Appel
Violation: Appel and associates that he recruited and directed to buy and sell shares, secretly acquired ownership or control over enough of the companies’ stock that he effectively controlled the float. Then he and his associates artificially created a market for these stocks by engaging in matched trading designed to create the false appearance of genuine demand for the stock… Read More

Penalties: N/A
Respondent: Robert Kenneth Lindell, Jr.
Violation: From on or about February 1, 2010, to on or about March 31, 2012, Lindell obtained unauthorized control over funds designated for the purchases of securities by his client and diverted the funds to his personal use and/or rather than use the funds designated by his client to purchase the securities, instead purchased the securities with other client funds or on margin… Read More

Penalties: N/A
Respondent: Daniel Pacheco
Violation: Pacheco misallocated and misappropriated substantial amounts of investor funds to the point that IPro had insufficient funds to honor its obligations under the recruitment compensation plan that had enticed investors to join the IPro program. Among other things, Pacheco used IPro funds to purchase a multi-million dollar house, transfer millions of dollars to entities controlled by him, and buy a Rolls Royce for his personal use… Read More

Penalties: N/A
Respondent: Mark Christopher Parman
Violation: In connection with the unregistered offer and sale of Intertech Solutions, Inc. (“ITEC”) securities, Respondent sold ITEC securities; effected transactions in, or induced or attempted to induce the purchase and sale of, ITEC securities while he was neither registered with the Commission as a broker nor associated with a registered broker-dealer; and obtained money or property by means of untrue statements of material fact or omissions to state material facts necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading… Read More

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