SEC ALLEGES BIOPHARMA CO. AND EXECUTIVES DID THE FRAUD THING

The following is an excerpt from the SEC wbsite:

"August 2, 2011
The Securities and Exchange Commission announced that on August 1, 2011, it charged Immunosyn Corporation (“Immunosyn”) and Argyll Biotechnologies, LLC (“Argyll”), both based in San Diego, California, with securities fraud in connection with materially misleading statements during 2006-2010 regarding the status of regulatory approvals for Immunosyn’s sole product, a drug derived from goat blood referred to as “SF-1019.” The Commission also charged Stephen D. Ferrone (“Ferrone”), of Lake Forest, Illinois, who was Immunosyn’s Chief Executive Officer (“CEO”), Douglas McClain Jr. (“McClain Jr.”), of Savannah, Georgia, who was Immunosyn’s Chief Financial Officer, Douglas McClain, Sr. (“McClain Sr.”), of Boerne, Texas, who was Argyll’s Chief Scientific Officer, and James T. Miceli (“Miceli”), of Poway, California, who was Argyll’s CEO, all with securities fraud; and it also charged Argyll, McClain, Jr., McClain, Sr., Miceli, Argyll Equities, LLC (“Argyll Equities”), based in San Diego, California, and Padmore Holdings, Ltd. (“Padmore”), an offshore entity, all with insider trading.
The Commission’s complaint, filed in federal court in Chicago, alleges that Immunosyn misleadingly stated in public filings with the Commission that Argyll, Immunosyn’s controlling shareholder, planned to commence the regulatory approval process for human clinical trials for SF-1019 in the U.S. or that regulatory approval was underway. The complaint alleges that these statements misled investors because the statements omitted to disclose that the U.S. Food and Drug Administration (“FDA”) had already twice issued clinical holds on drug applications for SF-1019, which prohibited clinical trials involving SF-1019 from occurring. The complaint also alleges that Immunosyn misleadingly stated that the regulatory approval process in Europe for human clinical trials for SF-1019 was imminent or underway, when in fact Argyll never submitted an application in Europe to conduct human clinical trials.
The Complaint alleges that McClain Jr., McClain Sr., and Miceli engaged in insider trading by raising approximately $20 million from their sale of Immunosyn shares while knowing that Immunosyn was making misrepresentations about the regulatory status of SF-1019. The Complaint alleges that they sold most of these shares through Argyll and Argyll Equities, which McClain Jr. and Miceli jointly owned, and Padmore, which McClain Jr., McClain Sr., and Miceli jointly owned. The Complaint also alleges that McClain Sr. made misstatements about the status of regulatory approval of SF-1019 in a video on Immunosyn’s public website, and in a 2008 presentation in which he sold Immunosyn stock he owned through Padmore to patients at a Texas holistic clinic, some of whom were terminally ill. The Complaint alleges that McClain Sr. raised approximately $300,000 from these patients but never gave them the shares they bought.
The Commission’s complaint seeks a final judgment permanently enjoining the defendants from future violations of the antifraud provisions of the federal securities laws, ordering each defendant to disgorge all ill-gotten gains, plus prejudgment interest, ordering each defendant to pay civil penalties, and barring Ferrone, McClain Jr., McClain Sr. and Miceli from serving as an officer or director of a public company.
The Commission acknowledges the assistance of the U.S. Food and Drug Administration.”