SEC Settles Charges For Registration Violations in Unregistered Securities
On July 23, 2013, the Securities and Exchange Commission (the “SEC”) settled charges against Florida resident Jorge Bravo, Jr., for unlawful sales of millions of shares of unregistered securities without complying with the registration statement requirements of the Securities Act of 1933.According to the SEC’s complaint from April 2009 until May 2010, Bravo unlawfully sold approximately millions of shares of unregistered securities of AVVAA World Health Care Products, Inc. in unregistered transactions without an exemption from registration. The SEC complaint alleges that Bravo obtained the shares through wrap around agreements involving debts that AVVAA purportedly owed to its officers, affiliates, or other insiders for services rendered.
Under the wrap around agreements, the debt holders assigned their debts to Bravo.
In the transactions, AVVAA consented to the debt assignments and agreed to modify the terms of the original debt obligation so that the purported debt was owed to Bravo and immediately convertible into AVVAA common shares. According to the SEC’s complaint, Bravo began selling the shares he obtained under the agreements to the public almost immediately. He then delivered a portion of the proceeds of the debt holders.
Without admitting or denying the SEC’s allegations, Bravo consented to an entry of a final judgment permanently enjoining him from future violations of Sections 5(a) and 5(c) of the Securities Act; permanently enjoining him from participating in any offering of penny stock; and requiring him to pay disgorgement of $ 392,000, the amount of his ill-gotten gains, plus prejudgment interest of $ 53,866 and a civil penalty in the amount of $150,000.
For further information about this securities law blog post, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956, by email at firstname.lastname@example.org or visit www.securitieslawyer101.com. This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed herein do not guarantee similar outcomes.
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Brenda Hamilton, Securities Attorney
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