Securities Lawyer 101 Blog On January 31, 2014, the Securities and Exchange Commission charged two Florida college professors with perpetrating a complex naked short selling scheme for more than $400,000 in illicit profits.
Read MoreSecurities Lawyer 101 Blog On January 27, 2014, the Securities and Exchange Commission (the “SEC”) announced the temporary suspension, pursuant to Section 12(k) of the Securities Exchange Act of 1934 (the “Exchange Act”), of trading in the securities of OLIE, Inc. (“OLIE”), of Vancouver, Canada, and of Hi Score Corp. (R…
Read MoreSecurities Lawyer 101 Blog Recently, the SEC’s Office of Compliance Inspections and Examinations (“OCIE”) issued guidance concerning Rule 105 (“Rule 105”) of Regulation M of the Securities Exchange Act of 1934, as amended. Rule 105 prohibits the purchase of securities in a secondary offering if the purchaser has a short position…
Read MoreSecurities Lawyer 101 Blog On November 12, 2013, the Securities and Exchange Commission (the “SEC”) announced a deferred prosecution agreement with Scott Herckisa, a former hedge fund administrator at Hellelwhite Fund LP, who assisted the SEC in an investigation involving Berton Hochfeld, a hedge fund manager who allegedly stole assets from inves…
Read MoreSecurities Lawyer 101 Blog On November 6, 2013, the Securities and Exchange Commission (the “SEC”) announced sanctions against a New York-based auditing firm, its founder, two other partners, and an audit manager for their roles in the failed audits of three publicly traded China-based companies. According to the SEC, an investigation found that…
Read MoreSecurities Lawyer 101 Blog On October 31, 2013, the Securities and Exchange Commission (the “SEC”) announced an award of more than $150,000 to a whistleblower whose tips helped the agency stop a scheme that was defrauding investors. The award recipient, who does not wish to be identified, provided significant information that allowed the SEC to…
Read MoreSecurities Lawyer 101 Blog On October 25, 2013, FINRA announced the release a set of proposed crowdfunding portal rules and forms for equity crowdfunding. Crowdfunding portals that engage in crowdfunding on behalf of issuers relying on the JOBS Act’s crowdfunding exemption must register with the SEC and become a member of a national securities associat…
Read MoreSecurities Lawyer 101 Blog On September 16, 2013, the Securities and Exchange Commission (the “SEC”) brought enforcement actions against more than 20 broker dealers and other financial firms alleging violations of Rule 105 of Regulation M of the Securities Exchange Act of 1934 (“Rule 105”), which prohibits the purchase of securities i…
Read MoreSecurities Lawyer 101 Blog On October 18, 2013, the Securities and Exchange Commission (the “SEC”) charged Yuhe International, Inc. (“Yuhe”), a China-based provider of broiler chickens, and its Chief Executive Officer, Gao Zhentao (“Gao”), with fraud and other violations of the securities laws. The SEC charges allege that Yuhe, under Gao’s direction and cont…
Read MoreSecurities Lawyer 101 Blog When the Securities and Exchange Commission (“SEC”) substantially completes an investigation into violations of the securities laws, it may issue what’s known as a “Wells notice” to targets, informing them that it intends to bring litigation, pending the Commission’s approval. The notice is named…
Read MoreSecurities Lawyer 101 Blog Like many other countries, the United States offers potential immigrants preferential treatment—in the form of conditional visas and eventual green cards—if they’re willing to invest in economic development projects that will preserve or create jobs in their new home. What’s offered is called the EB-5 Visa Program. W…
Read MoreSecurities Lawyer 101 Blog On October 1, 2013, the Securities and Exchange Commission (the “SEC”) announced it had awarded more than $14 million to a whistleblower whose information led to an SEC enforcement action that recovered substantial investor funds. Payments to whistleblowers are made from a separate fund previously established by the Do…
Read MoreSecurities Lawyers Gone Wild Blog On 23 September 2013, the U.S. Attorney’s Office for the Central District of California announced that attorney David Tamman, formerly of the Nixon Peabody law firm, had been sentenced to seven years’ imprisonment for obstructing two investigations into a $22 million investment fraud. Judge Phillip S. Gutierrez n…
Read MoreSecurities Lawyers Gone Wild Blog On September 19, 2013, the Dallas Division of the Federal Bureau of Investigation (“FBI”) announced the unsealing of an indictment charging Jason Wynn, a former penny stock promoter, and securities attorney Martin Cantu with crimes committed in connection with a company called ConnectAJet.com (CAJT). The two men were arreste…
Read MoreSecurities Lawyer 101 Blog On September 17, 2013, the Securities and Exchange Commission (“SEC”) issued a trading suspension of the common shares of PacWest Equities (“PWEI”), a company whose shares were quoted on the OTC Markets with an OTC Pink Current tier. The SEC trading suspension is for a ten day period. The SEC action was brought because…
Read MoreOn September 3, 2013, the Securities and Exchange Commission (“SEC”) filed a fraud complaint in Federal District Court for the Southern District of New York charging Ronald Feldstein and two entities controlled by him, Mara Capital Management and Vita Health of America, with a “free-riding” fraud scheme on the one hand, and with bilking investors […]
Read MoreOn 22 August 2013, Douglas Hollingsworth of Santa Rosa, California was sentenced to 64 months in prison for defrauding investors of at least $4.9 million in a five-year Ponzi scheme. The U.S. Attorney’s Office for the Northern District of California had brought charges against him in 2011. Earlier in the year, Hollingsworth pled guilty [&hellip…
Read MoreOn August 30, 2013, the Securities and Exchange Commission (the “SEC”) announced that it had awarded three whistleblowers for tips and information they provided to help the SEC and Justice Department stop a sham hedge fund. The SEC’s whistleblower program under the Dodd-Frank Act allows the SEC to reward bounties to individuals who offer high-qu…
Read MoreQ. How Much Money Can I Raise In A Rule 504 Offering? A. The aggregate amount raised for an offering of securities under Rule 504 cannot exceed $1,000,000, less the aggregate offering price for all securities sold within the twelve months before the start of and during the offering of securities under this Rule 504, […]
Read MoreSecurities Lawyer 101 Blog On August 13, 2013, the U.S. Attorney’s Office for the Eastern District of New York announced the indictment of Sandy Winick, a Canadian promoter now living in Thailand; Gregory Curry, a Canadian living in Thailand; Kolt Curry, a Canadian living in Thailand and Canada; Gregory Ellis, a Canadian; Gary Kershner, a U.S. [&hellip…
Read MoreOn August 6, 2013, the Securities and Exchange Commission (the “SEC”) obtained an emergency court order to halt a hedge fund investment scheme targeting mostly unsophisticated investors including friends, family members, and military personnel to invest in his hedge fund. According to the SEC, the fund was controlled by a former Marine living in…
Read MoreSEC issued a trading suspension of Camelot Entertainment Group, Inc. (CMGR), Cavico Corp. (CAVO), Global 8 Environmental Technologies, Inc. (GBLE), GTC Telecom Corp. (GTCC), ICF Corporation (ICFO) and New NRG, Inc. (NNRG) due to a lack of current and accurate information. The suspended issuers failed to file required periodic reports with the SEC. The SEC…
Read MoreSecurities Lawyer 101 Blog No company wants to become the target of a Securities and Exchange Commission (“SEC”) investigation, and no investor welcomes an inquiry into a stock he holds. Issuers and shareholders alike need to understand how an investigation begins, how it proceeds, and how it may end. If the SEC determines that someone […]
Read MoreSecurities Lawyer 101 Blog On June 26, 2013, the Securities and Exchange Commission (“SEC”) filed an enforcement action charging Imaging3, Inc. (IMGGQ), and Dean Janes, its CEO, with securities fraud, accusing Janes of misleading shareholders about actions taken by the Food and Drug
Read MoreSecurities Lawyer 101 Blog On June 25, 2013, the Securities and Exchange (“SEC”) suspended trading in the securities of Biozoom, Inc. (BIZM). In connection with the SEC action, it stated that “certain Biozoom affiliates and shareholders may have unjustifiably
Read MoreSecurities Lawyer 101 Blog On May 3, 2013, in connection with an action that went unnoticed by most penny stock observers, the U.S. Attorney’s Office for the District of Massachusetts announced that John Jordan, of Cameron Park, California, and James Prange, of Greenbush, Wisconsin,had been found guilty of conspiracy to commit securities fraud, and of…
Read MoreSecurities Lawyer 101 Blog In June 12, 2013, the Securities and Exchange Commission (“SEC”) brought an action against an additional defendant for his role in a frauduent kickback scheme involving the payment of millions of dollars in bribes to a Venezuelan finance official in order to obtain the bond trading business of a state-owned Venezuelan bank, the [&h…
Read MoreSecurities Lawyers Gone Wild Series Securities Law 101 Blog Sunrise Solar’s most recent financial report filed was a 10-Q for the period ended March 31, 2009. According to the SEC action, Sunrise Solar purported to be in the solar power business, and was located in San Antonio, Texas. The
Read MoreSecurities Lawyer 101 Blog On June 20, 2013, the Securities and Exchange Commission (the “SEC”) brought yet another securities fraud enforcement action against a China-based company that went public on the U.S. markets through a reverse merger. The SEC action charges China MediaExpress and its CEO with securities fraud for overstating cash balances by milli…
Read MoreCompany President Lies to Investors Most people think of the Securities and Exchange Commission (“SEC”) as a regulator of publicly traded companies. But the SEC’s authority extends to any company or individual—public or private—that offers or sells securities. If the
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