2020 has been a historic year for Securities and Exchange Commission (“SEC”) enforcement action against toxic lenders as unregistered dealers.
Category: Blog Posts Tags: broker-dealer, Chicago Venture Partners LP, Dilution, financing, FINRA, Ibrahim Almagarby, Iliad Research and Trading LP, JDF Capital Inc, JMJ Financial, John Fierro, John M. Fife, Justin Keener, litigation, Microcap Equity Group LLC, Microcap Stock, OTC Markets, Penny stocks, public Issuer, reverse split, scam, SEC, SEC Complaint, SEC enforcement action, Section 15(a), securities, Securities and Exchange Commission, securities attorneys, Securities Exchange Act of 1934, St George Investments LLC, stock price, Tonaquint Inc, toxic funding, toxic lenders, transfer agents, Typenex Co-Investment LLC, unregistered dealers
SPACs, which stand for special purpose acquisition companies, are similar to blank check companies. The SPAC does an Initial Public Offering (an “IPO”) as a shell company with no commercial operations to raise money from the public for the purpose of acquiring an existing private company with real operations.
Category: Blog Posts Tags: Bill Ackman, blank check company, capital raise, COVID-19, Diamond Eagle Acquisition Corp, DKNG, DraftKings Inc, Going Public, initial public offering, investors, IPO, Jay Clayton, merger, Nikola Corp, NKLA, Pershing Square Tontine Holdings, Renaissance Capital, SEC, SEC Chairman, Shell Company, Social Capital Hedosophia Holdings, SPAC, SPCE, Special Purpose Acquisition Company, VectolQ Acquisition, Virgin Holdings Inc
With Jay Clayton stepping down as the Chairman of the Securities and Exchange Commission at the end of the year, president-elect Joe Biden will have an opportunity to pick his replacement. Who are some of the top candidates as a full-time replacement for SEC chief?
Category: Blog Posts Tags: African American SEC Chair, Allison Herren Lee, Allison Lee, Annette L Nazareth, Annette Nazareth, Barack Obama, CFTC, Chris Brummer, Commodity Futures Trading Commission, crime, Department of Justice, dodd-frank, doj, Donald J Trump, federal prosector, Financial Industry Regulatory Authority, FINRA, Gary Gensler, George W Bush, hedge funds, Jay Clayton, Joe Biden, Kara Marlene Stein, Kara Stein, Keir Gumbs, law professor, Michael Barr, Michael S Barr, moderates, Preet Bharara, president, progressives, Robert J Jackson Jr, Robert Jackson, SEC, SEC chair, SEC Chairman, SEC chief, Securities and Exchange Commission, Securities Fraud, Steven Cohen, Timothy Geithner, Treasury, uber, wall street, Wall Street Reform
On November 16, 2020, Jay Clayton, Chairman of the Securities and Exchange Commission, announced that he would be stepping down at the end of the year after 3 years and 238 days on the job.
Category: Blog Posts Tags: 10b5-1, alternative trading systems, blank-check companies, blockchain, broker-dealer, CNBC, COVID-19, Cyber Unit, cybersecurity, Digital Assets, Division of Enforcement, Harold M Williams, ICO, Initial Coin Offerings, insider trading, investors, Jay Clayton, jobs act, Joe Biden, John Shad, Main Street Investors, Manuel F Cohen, Mary Jo White, municipal bond market, OCIE, regulations, SEC, SEC Chairman, SEC enforcement actions, sec rules, Securities and Exchange Commission, SPACs, special purpose acquisition companies, startups, whistleblower
On November 19, 2020, the United States Attorney William M. McSwain filed a superseded Indictment against Jeffrey D Martin, 61, of Orlando, FL. Martin was charged with conspiracy and multiple counts of securities fraud and wire fraud, related to his manipulation of several publicly-traded securities in a “pump and dump” scheme in which Martin and his co-schemers allegedly defrauded investors out of over $19 million.
Category: Blog Posts Tags: ACAP Financial Inc, aiding and abetting securities fraud, AIOM. QEBR, Am-Pac International Inc, Axiom Holdings Inc, Beaufort Capital Partners LLC, British Virgin Islands, Christian T Tedrow, co-conspirators, conspiracy to commit securities and wire fraud, conspiracy to commit securities fraud, Criminal Indictment, Department of Justice, disgorgement. fines, doj, fbi, FINRA, First Power and Light, fraud, fraudulent press releases, fraudulent securities disclosures, Gary Hume, Harold J Swart Jr, Hong Kong, Inc, Indictment, Jeffrey D Martin, Karen F Aalders, Kirk Lynn Ferguson, Mainstream Entertainment Inc, MSEI, OTC Markets William M McSwain, Penny Stock, pump and dump, Resort Savers Inc, Robert P Marino, RSSV, SEC, Sterling Craig Barton, stock manipulation, Superseded Indictment, Swart Baumruk & Co. LLP, Thomas L Tedrow, Tyler T Tedrow, UGHL, Union Bridge Holdings LTD, United States Attorney, United States Attorney's Office Eastern District of Pennsylvania, United States Securities and Exchange Commission, Virtual medical International Inc, VOLT, Volt Solar Systems Inc, wire fraud
Today, the Securities and Exchange Commission (the “SEC”) charged a San Francisco-based e-commerce startup and its chief executive officer with misleading investors about purported contracts with well-known consumer brands.
Category: Blog Posts Tags: Andrew J Chapin, Backcountry.com, Benja Incorporated, criminal charges, doctored bank statements, doj, falsified documents, Fanatics, forged contracts, fraud, impersonated customers, Indictment, investors, Nike, Patagonia, scam, SEC, SEC Complaint, Securities and Exchange Commission, Startup, US Attorney's Office for the Northern District of California, venture capital, Zappos
Last week, the SEC Division of Trading and Markets published a staff bulletin highlighting various risks for broker-dealers arising from certain transactions in “penny stocks” and other low-priced securities. The Commission emphasized that these risks are heightened when the identities of a foreign financial institution’s underlying customer and/or the ultimate beneficial owner of the funds and securities are unknown to a broker-dealer because of the omnibus account structure.
Category: Blog Posts Tags: AML, AML Program, Bank Secrecy Act, broker-dealers, BSA, enforcement actions, federal securities laws, FINRA, foreign accounts, fraud, illegal stock sales, illicit activities, Jay Clayton, Money Laundering, omnibus accounts, OTC Markets, Penny stocks, SAR, SEC, SEC Division of Trading and Marketing, securities, Special Due Diligence Program, Stock Promotion, Suspicious Activity Report, unregistered securities offering, US Securities and Exchange Commission
According to the annual report published by the Division of Enforcement of the U.S. Securities and Exchange Commission (the “SEC”), there were 715 overall enforcement actions in fiscal 2020, down 17% from the previous year.
Despite the slow down, financial remedies ordered “set a new high,” according to Stephanie Avakian, the agency’s enforcement chief. The Commission obtained judgments and orders totaling approximately $4.68 billion in disgorgement and penalties – the highest amount on record.
Category: Blog Posts Tags: 2020, administrative proceedings, Aethlon Medical Inc, Applied BioSciences Corp, Arrayit Corporation, BioElife Corp, BioXyTran Inc, Blackhawk Growth Corp, Bravatek Solutions Inc, CNS Pharmaceuticals Inc, complaints, Cornerstone Research, coronavirus, COVID-19, Covid-19 Pandemic, criminal authorities, Custom Protection Services Inc, Decision Diagnostics Corp, delinquent SEC filers, disgorgements, Division of Enforcement, Douglas Roe, Eastgate Biotech, EastWest Bioscience Inc, enforcement actions, Jason C. Nielsen, Kelly Warawa, Key Capital Corporation, Kleangas energy Technologies Inc, Lord Global Corp, Mark Schena, Michael Luckhoo-Bouche, Microcap, Micron Waste Technologies Inc, Moleculin Biotech Inc, Nano Magic Inc, Nelson Gomes, No Borders Inc, NYU Pollack Center for Law & Business, OTC Markets, Parallax Health Sciences Inc, penalties, Penny Stock, Praxsyn Corporation, PreCheck Health Services Inc, Predictive Technologies Group Inc, Prestige Capital Corp, public companies, referrals, regulators, Roadman Investments Corp, Sandy Steele Unlimited Inc, SCWorx Corp, SEC, SEC Issuers, Securities Exchange Commission, SEED, Signpath Pharma Inc, Solei Systems Inc, Solutions Inc, SpectrumDNA Inc, Stephanie Avakian, TCRs, tips, tradings suspension, Turbo Global Partners Inc, US Lithium Corp, US Securities and Exchange Commission, Wellness Matrix Group Inc, whistleblower, WOD Retail, WPD Pharmaceuticals Inc, Zoom Technologies Inc
Last week, E*TRADE, a subsidiary of Morgan Stanley, which offers an electronic trading platform to trade financial assets including common stocks, announced that effective November 21, 2020, customers will no longer be able to open positions in Caveat Emptor securities due to the risks associated with trading shares in these companies.
Category: Blog Posts Tags: Caveat Emptor, E-Trade, E*TRADE, Expert Market, fraud, Grey Market, OTC Markets, OTC Markets Group, Penny stocks, Promotion, Public Interest Concerns, Risk, SEC, Securities Exchange Commission, Suspension/Halt
On November 13, 2020, the Securities and Exchange Commission (the “SEC”) announced an award of over $1.1 million to a whistleblower whose independent analysis led the staff to look at new conduct during an ongoing investigation.
Category: Blog Posts Tags: Dodd-Frank Act, fraud, Jane Norberg, OTC Markets, Overseas, Penny Stock, SEC, SEC Action, SEC Investigation, SEC Issuer, SEC tips, Securities Exchange Commission, Securities Laws, Securities Laws Violations, Whistlerblower
The SEC adopted amendments to: (1) establish a new integration framework for issuers to move from one securities offering exemption to another; (2) increase the current offering and investment limits for Regulation A Offerings, Regulation Crowdfunding – Regulation CF and Rule 504 offerings; and (3) amend “Test-the-Waters” and “Demo Day” offering communications rules.
Category: Blog Posts Tags: Crowdfund, Crowdfunding, Crowdfunding Lawyer, Crowdfunding Lawyers, Form C-AR, Ongoing Reporting, Regulation A, Regulation A Attorney, Regulation A Lawyer, Regulation CF, Regulation CF Attorney, Regulation CF Attorneys, Regulation CF Capital Raise, Regulation CF Crowdfunding, Regulation CF Funding, Regulation CF Law Firm, Regulation CF Lawyer, Regulation CF Lawyers, Regulation CF offering, Regulation CF Requirements, Regulation Crowdfunding, Regulation Crowdfunding Offering, Regulation Crowdfunding Reporting, Regulation Crowdfunding Requirements, Regulation Crowdfunding SEC Reporting, Regulation Crowdfunding Securities Offering, Regulation D, SEC Reporting Requirements
On October 6, 2020, the Securities and Exchange Commission (the “SEC”) charged businessman and computer programmer, John McAfee, for promoting investments in initial coin offerings (ICOs) to his Twitter followers without disclosing that he was paid to do so. McAfee’s bodyguard, Jimmy Watson, Jr., was also charged for his role in the alleged scheme.
Category: Blog Posts Tags: Jimmy Watson, John McAfee, Jr., microcap securities, Microcap Stock, OTC Markets, Penny Stock, Penny Stock Bars, Penny Stock Investor, Penny Stock Issuer, ponzi scheme, regulation, SEC, SEC Action, SEC Administrative Proceeding, SEC Attorney, SEC Claim, SEC Defendant, SEC Defense, SEC Defense Attorney, SEC enforcement, SEC Fraud, SEC Injunction, SEC Law Firm, SEC Lawsuit, SEC Lawyer, SEC Litigation, SEC Penny Stock Bar, SEC Subpoena, Securities Fraud, Securities Law Defense, stock scheme
Edward T. Kelly, Aceto Corporation, Insider Trading, Lakewood Ranch Florida
Category: Blog Posts Tags: Aceto, Aceto Corporation, Edward Kelly, Edward T. Kelly, Florida, Lakewood Ranch Floirda, microcap securities, Microcap Stock, OTC Markets, Penny Stock, Penny Stock Bars, Penny Stock Investor, Penny Stock Issuer, ponzi scheme, regulation, SEC, SEC Action, SEC Administrative Proceeding, SEC Attorney, SEC Claim, SEC Defendant, SEC Defense, SEC Defense Attorney, SEC enforcement, SEC Fraud, SEC Injunction, SEC Law Firm, SEC Lawsuit, SEC Lawyer, SEC Litigation, SEC Penny Stock Bar, SEC Subpoena, Securities Fraud, Securities Law Defense, stock scheme
On October 1, 2020, the U.S. District Court for the Eastern District of Pennsylvania entered a final consent judgment against Nicholas Tornello, a former senior accountant at Hill International, Inc.
Category: Blog Posts Tags: Hill International Inc, microcap securities, Microcap Stock, Nicholas Tornello, OTC Markets, Pennsylvania, Penny Stock, Penny Stock Bars, Penny Stock Investor, Penny Stock Issuer, ponzi scheme, regulation, SEC, SEC Action, SEC Administrative Proceeding, SEC Attorney, SEC Claim, SEC Defendant, SEC Defense, SEC Defense Attorney, SEC enforcement, SEC Fraud, SEC Injunction, SEC Law Firm, SEC Lawsuit, SEC Lawyer, SEC Litigation, SEC Penny Stock Bar, SEC Subpoena, Securities Fraud, Securities Law Defense, stock scheme
At its October 7, 2020 open meeting, the Securities and Exchange Commission (the “SEC”) voted to propose exemptive relief for certain finders engaged in raising capital from accredited investors. If the proposal is adopted, it would allow them to receive commissions and other transaction-based compensation without registration as a broker-dealer under Section 15 of the Securities Exchange Act of 1934 (the “Exchange Act”).
Category: Blog Posts Tags: broker-dealer, Dealer, Finder, Finders, Finders Exemption, Finders Exemption from Registration, registered representative, SEC Proposal, SEC Reporting Company, SEC Reporting Requirements, The Exchange Act, The Securities Act, Tier 1 Finder, Tier 1 Finders, Tier 2 Finder, Toxic Lender, Unregistered Dealer
On September 16, 2020, SEC amended Exchange Act Rule 15c2-11 and Form 211. Changes to Rule 15c2-11 were proposed last year. The OTC Markets will be impacted by the changes as will penny stock issuers on the OTCQB and OTC Pink tiers.
Online Platforms for Rule 506(c) Offerings The most common exemption from SEC Registration is Rule 506(c) of Regulation D which provides for two unique exemptions from SEC registration that allow the issuer to raise unlimited amounts of capital… Read More
Category: Blog Posts Tags: Accredited Investor, Accredited Investors, Brenda Hamilton, FINRA, Regulation D, Regulation D Rule 506, Rule 501, Rule 501(a), Rule 506(b), Rule 506(c), SEC Amendment, the Securities Act of 1933
On August 26, 2020, the United States Securities and Exchange Commission (the “SEC”) finalized its proposed rule amending the disclosure requirements under Items 101, 103, and 105 of Regulation S-K. The revisions to Regulation S- K modernize SEC disclosure requirements and provide investors with more meaningful information about an issuer’s business, legal proceedings, and risks of an investment in the issuer’s securities. They also reduce the burden on issuers to disclose certain information that might be immaterial to the issuer’s business. Items 101, 103 and 105 have not been substantially revised for over 30 years. Issuers conducting direct public offerings or filing registration statements on Form F-1 or S-1 should be aware of these changes.
Category: Blog Posts Tags: Item 105 Risk Factors, Direct Public Offering, Form F-1, Form S-1, Go Public, Going Public, Item 101 Description of the Business, Item 101(c), Item 103, Item 103 Legal Proceedings, Regulation S-K, Regulation S-K Item 101, Regulation S-K Item 103, Regulation S-K Item 105. Form S-1, SEC Description of Business, SEC Disclosure Requirements, SEC Legal Proceedings, SEC Risk Factors, Smaller Reporting Companies
Rule 506 Offerings are the most common of the Regulation D exemptions from registration under the Securities Act of 1933, as amended (the “Securities Act”). Rule 506 contains two distinct offering exemptions. Rule 506(b) and Rule 506(c). Rule 506 (b) provides an exemption to an unlimited number of accredited investors and up to thirty-five non-accredited investors without the use of general solicitation and advertising while Rule 506(c) allows the issuer to sell to an unlimited number of accredited investors so long as it verifies that each investors is an accredited investor.
Category: Blog Posts Tags: Accredited Investor, Accredited Investors, Brenda Hamilton, FINRA, Regulation D, Regulation D Rule 506, Rule 501, Rule 501(a), Rule 506(b), Rule 506(c), SEC Amendment, the Securities Act of 1933
The SEC filed an enforcement action against John Fife, an unregistered dealer and 5 companies he controlled including St. George Investments LLC and Tonaquint, Inc. According to the SEC, Fife and his companies had acted for years as securities dealers, but failed to register with the SEC and with the Financial Industry Regulatory Authority (“FINRA”) as the Securities Exchange Act of 1934 (“Exchange Act”) requires.
We’ve previously written about Securities and Exchange Commission (“SEC”) enforcement actions pending against John Fierro and Justin Keener alleging unregistered dealer activity. Filed in February and March 2020 respectively, they are similar to a lawsuit the agency brought… Read More
Category: Blog Posts Tags: Almagarby, Convertible Note, Dealer, Dilution, Dilution Funder, Ibrahaim Almagarby, Ibrahaim Almagarby Microcap Equity Group, John Fierro, Justin Keener, Microcap, Microcap Equity, Microcap Equity Group, SEC Action, Toxic Funders, Unregistered Dealer
As business owners, it’s important that you watch out for all of these forms of business identity theft. Your business, whether big or small, is vulnerable to all of these schemes, just by virtue of being in business.
On June 17th, 2020, the SEC charged international insurance company AmTrust Financial Services, Inc. and its former CFO Ronald E. Pipoly Jr. with failing to disclose material facts …
Category: Blog Posts Tags: AmTrust, microcap securities, Microcap Stock, OTC Markets, Penny Stock, Penny Stock Bars, Penny Stock Investor, Penny Stock Issuer, ponzi scheme, regulation, Ronald E. Pipoly Jr, SEC, SEC Action, SEC Administrative Proceeding, SEC Attorney, SEC Claim, SEC Defendant, SEC Defense, SEC Defense Attorney, SEC Defense Lawyer, SEC enforcement, SEC Fraud, SEC Injunction, SEC Law Firm, SEC Lawsuit, SEC Lawyer, SEC Litigation, SEC Penny Stock Bar, SEC Subpoena, Securities Fraud, Securities Law Defense, stock scheme
The SEC has obtained final judgments against movie director and convicted felon Daniel Adams, music producer Michael Flanders, and companies under their control for defrauding two investors in connection with financing the movie entitled An L.A. Minute.
Category: Blog Posts Tags: Daniel Adams, L.A. Minute LLC, Michael Flanders, microcap securities, Microcap Stock, OTC Markets, Penny Stock, Penny Stock Bars, Penny Stock Investor, Penny Stock Issuer, ponzi scheme, regulation, SEC, SEC Action, SEC Administrative Proceeding, SEC Attorney, SEC Claim, SEC Defendant, SEC Defense, SEC Defense Attorney, SEC enforcement, SEC Fraud, SEC Injunction, SEC Law Firm, SEC Lawsuit, SEC Lawyer, SEC Litigation, SEC Penny Stock Bar, SEC Subpoena, Securities Fraud, Securities Law Defense, Spiderworx Media LLC, stock scheme
Dilution Funders and Dilution Financings Challenged by SEC
Category: Blog Posts Tags: broker-dealer, convertible promissory note, David Foley, Dealer, Dilution Financing, Dilution Funder, Exchange Act Section 15(a), financing agreement, JDF Capital, JMJ Financial, John Fierro, microcap securities, Microcap Stock, OTC Markets, Penny Stock, Penny Stock Bars, Penny Stock Investor, Penny Stock Issuer, ponzi scheme, regulation, Ronald E. Pipoly Jr, SEC, SEC Action, SEC Administrative Proceeding, SEC Attorney, SEC Claim, SEC Defendant, SEC Defense, SEC Defense Attorney, SEC Defense Lawyer, SEC enforcement, SEC Fraud, SEC Injunction, SEC Law Firm, SEC Lawsuit, SEC Lawyer, SEC Litigation, SEC Penny Stock Bar, SEC Subpoena, Securities Fraud, Securities Law Defense, stock scheme, Toxic Funder
The U.S. District Court for the Eastern District of New York entered a final judgment as to monetary relief against the former de facto CEO of Giga Entertainment Media, Inc., Gary S. Nerlinger, whom the SEC previously charged in connection with a scheme to mislead investors.
Category: Blog Posts Tags: Gary Nerlinger, Giga Entertainment Inc, Lawrence Silver, microcap securities, Microcap Stock, New York, OTC Markets, Penny Stock, Penny Stock Bars, Penny Stock Investor, Penny Stock Issuer, ponzi scheme, regulation, SEC, SEC Action, SEC Administrative Proceeding, SEC Attorney, SEC Claim, SEC Defendant, SEC Defense, SEC Defense Attorney, SEC enforcement, SEC Fraud, SEC Injunction, SEC Law Firm, SEC Lawsuit, SEC Lawyer, SEC Litigation, SEC Penny Stock Bar, SEC Subpoena, Securities Fraud, Securities Law Defense, stock scheme
The SEC announced that it has obtained final judgments by consent against Ronald Hardy, Anthony Vassallo, and Sergio Ramirez charged for their roles in a $10 million boiler room scheme.
Category: Blog Posts Tags: Anthony Vassallo, microcap securities, Microcap Stock, OTC Markets, Penny Stock, Penny Stock Bars, Penny Stock Investor, Penny Stock Issuer, ponzi scheme, regulation, Ronald Hardy, SEC, SEC Action, SEC Administrative Proceeding, SEC Attorney, SEC Claim, SEC Defendant, SEC Defense, SEC Defense Attorney, SEC enforcement, SEC Fraud, SEC Injunction, SEC Law Firm, SEC Lawsuit, SEC Lawyer, SEC Litigation, SEC Penny Stock Bar, SEC Subpoena, Securities Fraud, Securities Law Defense, Sergio Ramirez, stock scheme
The SEC announced that it has obtained court approval of settlements with eight defendants: Arkadiy Dubovoy, Igor Dubovoy, Southeastern Holding and Investment Company LLC, APD Developers, Inc., Leonid Momotok, Aleksandr Garkusha, Vladislav Khalupsky, and Memelland Investments Ltd, charged in connection with an international scheme to trade on hacked news releases.
Category: Blog Posts Tags: Aleksandr Garkusha, APD Developers, Arkadiy Dubovoy, Igor Dubovoy, Inc, Leonid Momotok, Memelland Investments Ltd, microcap securities, Microcap Stock, OTC Markets, Penny Stock, Penny Stock Bars, Penny Stock Investor, Penny Stock Issuer, ponzi scheme, regulation, SEC, SEC Action, SEC Administrative Proceeding, SEC Attorney, SEC Claim, SEC Defendant, SEC Defense, SEC Defense Attorney, SEC enforcement, SEC Fraud, SEC Injunction, SEC Law Firm, SEC Lawsuit, SEC Lawyer, SEC Litigation, SEC Penny Stock Bar, SEC Subpoena, Securities Fraud, Securities Law Defense, Southeastern Holding and Investment Company LLC, stock scheme, Ukraine, Vladislav Khalupsky
Sales of restricted securities by affiliates and control persons of publicly traded companies are subject to requirements not applicable to other sellers under federal securities laws. Control person and affiliate are defined by Rule 405.
Form 3 must be filed within ten (10) calendar days after a person becomes a Section 16 insider. Form 3 is a simplified SEC form that allows insiders to report initial ownership information.
