FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
The Securities and Exchange Commission today charged a father, son, and daughter with running a nationwide investment scheme that falsely promised investors whopping returns from a gold mining operation while their money was actually spent on family cars, jewelry, vacations, and vitamin supplements.
The SEC alleges that Harry Dean Proudfoot III of Mt. Vernon, Ohio, and his children Matthew Dale Proudfoot of Colbert, Wash., and Laurie Anne Vrvilo of Tigard, Ore., raised at least $2.7 million from approximately 140 investors in 23 states through their Portland, Oregon-based company 3 Eagles Research & Development LLC (3 Eagles). They told investors their company would extract gold worth more than $11 billion from gravel pits in central Ohio, and promised investors they could earn 35 times their initial investment. However, 3 Eagles did not even have rights to much of the property it claimed to be mining for gold, and the Proudfoots instead diverted investor money for personal use rather than the mining activities outlined in presentations to investors.
According to the SEC's complaint filed in federal court in Portland, the scheme primarily occurred between September 2009 and October 2011. The Proudfoots sold investors "royalty units" in the purported gold mining project, claiming their money would be used to purchase mining equipment and conduct mining operations at two gravel pits. The Proudfoots falsely touted they had an expert geologist on the mining project. They solicited investors in a variety of ways, including through a Power Point presentation filled with misleading information. They also hired a securities broker named Dennis Ashley Bukantis of Denver, who is not registered with the SEC and assisted in the sale of royalty units in exchange for nearly $165,000 in commissions. Bukantis is charged along with the Proudfoots in the SEC's complaint.
The SEC alleges that rather than using investor funds for gold mining equipment and operations, the Proudfoots siphoned off more than $1.1 million of investor money and misused 3 Eagles corporate accounts as their own personal piggy bank, leaving the company penniless and unable to pay the necessary expenses to get the Ohio mine into production. Among their illicit personal expenditures, the Proudfoots spent $80,000 on automobiles, $235,000 in personal travel, and upwards of $30,000 per year for vitamins and nutritional supplements.
According to the SEC's complaint, after being served investigative subpoenas by the SEC and various state securities regulators in the fall of 2011, Harry Proudfoot was removed from the company and 3 Eagles represented it stopped selling royalty units. However, by December, Matthew Proudfoot was again selling investors a stake in 3 Eagles, this time calling them "membership interests" that would be used to move the Ohio mining project into production. Yet once again, much of the investor money was misused for personal expenses, including defense lawyers for each of the Proudfoots and 3 Eagles as well as Matthew Proudfoot's bankruptcy payments and household bills.
The SEC's complaint charges 3 Eagles, Harry Proudfoot, Matthew Proudfoot and Laurie Vrvilo with violations of Sections 5(a), 5(c) and 17 (a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5(a), (b) or (c) thereunder. The complaint also charges Bukantis with acting as an unregistered broker in violation of Section 15 (a) of the Exchange Act. The complaint seeks permanent injunctions, disgorgement with prejudgment interest and civil monetary penalties.
The SEC's case was investigated by Heather E. Marlow and Tracy L. Davis of the SEC's San Francisco Regional Office, and the litigation will be led by John Yun. The SEC thanks the State of Washington's Department of Financial Institutions for its assistance in this matter.
Saturday, July 28, 2012
Friday, July 27, 2012
U.S. DEPARTMENT OF JUSTICE REQUIRES UTC TO DIVEST CERTAIN ASSETS IN ANTITRUST CASE
FROM: U.S. DEPARTMENT OF JUSTICE
WASHINGTON — The Department of Justice announced today that it will require United Technologies Corporation (UTC) to divest certain assets used in the production of electrical power systems and aircraft engine control systems in order to proceed with its acquisition of Goodrich Corporation. At approximately $18.4 billion, the acquisition is the largest merger in the history of the aircraft industry. The department said that the acquisition, as originally proposed, likely would have resulted in higher prices, less favorable contractual terms and less innovation for several critical aircraft components, including generators, engines and engine control systems.
The department’s Antitrust Division filed a civil antitrust lawsuit today in the U.S. District Court for the District of Columbia to block the proposed acquisition. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive concerns alleged in the lawsuit.
"The acquisition as originally proposed would have lessened the vigorous competition that currently exists among manufacturers of large main engine generators, aircraft turbine engines and engine control systems for large aircraft turbine engines," said Jamillia Ferris, Chief of Staff and Counsel at the Department of Justice’s Antitrust Division.
The department’s Antitrust Division, the European Commission and the Canadian Competition Bureau cooperated closely throughout the course of their respective investigations, with frequent contact among the agencies. In addition, the Antitrust Division had discussions with other competition agencies, including the Federal Competition Commission in Mexico and the Administrative Council for Economic Defense in Brazil.
"The Antitrust Division’s dialogue with our international counterparts around the world facilitated our investigation," said Ferris. "In particular, the division’s close cooperation with the European Commission and Canadian Competition Bureau resulted in a coordinated remedy that will preserve competition in the United States and internationally."
The department’s complaint alleges that the proposed acquisition would lessen competition substantially in the worldwide markets for the development, manufacture and sale of large main engine generators, aircraft turbine engines and engine control systems for large aircraft turbine engines. The department said that the acquisition, as originally proposed, would combine the only two significant suppliers of large main engine generators for aircraft in the world. UTC also would acquire Goodrich’s engine control systems business, which supplies critical components to several of UTC’s leading competitors for aircraft turbine engines. Finally, UTC, which is currently one of three leading suppliers of engine control systems for large aircraft turbine engines, would acquire Goodrich’s 50 percent share in a joint venture that forms one of the other two producers of such engine control systems.
Aircraft main engine generators produce the electrical power used by communication and navigation equipment, environmental control systems, interior and exterior lighting and other aircraft systems. Large main engine generators are complex mechanical devices that are difficult to produce, and for which there are no substitutes. Turbine engines power virtually all modern commercial, business and military aircraft. UTC is one of the few firms worldwide that produce aircraft turbine engines. Engine control systems, consisting of electronic engine controls, pumps, fuel metering units and related components, control the flow of fuel into an aircraft turbine engine such that the engine performs in a safe and efficient manner. It would be difficult and time-consuming for an engine producer to switch to an alternative supplier of engine control systems.
The proposed settlement requires UTC to divest the following assets:
Goodrich’s business that designs, develops and manufactures large main engine generators for aircraft, including Goodrich’s shares in TRW-Thales Aerolec SAS (Aerolec);
Goodrich’s business that designs, develops and manufactures engine control systems; and
Goodrich’s shares in Aero Engine Controls (AEC), a joint venture to manufacture engine control systems for large aircraft turbine engines.
In addition, the proposed settlement provides:
UTC must extend the term of certain contracts held by customers of Goodrich’s engine control systems business for a period of 30 days after the divestiture of the engine control systems business;
UTC must provide various supply and transition services agreements to the acquirers of the assets being divested in order to assist in the transition of the businesses and allow the acquirers to continue to fulfill obligations of the divested businesses; and
UTC must extend the period for its joint venture partner, Rolls-Royce Group plc (Rolls Royce), to exercise its option to acquire the Goodrich business that provides aftermarket services for Rolls-Royce engines equipped with AEC engine control systems.
The extension of Rolls-Royce’s option to acquire the Goodrich aftermarket business will ensure that Rolls-Royce has sufficient control over the AEC aftermarket business. The extension of the customer contracts for the engine control systems business will ensure that Goodrich’s engine control systems customers have a reliable source of supply during the divestiture period.
UTC is a Delaware-based company that produces a wide range of products for the aerospace industry and other industries, including, among other products, aircraft generators, aircraft engine control systems and components, aircraft engines and helicopters. UTC’s main aerospace divisions are Pratt & Whitney, Hamilton Sundstrand and Sikorsky. In 2010, UTC had revenues of approximately $54 billion.
Goodrich is a New York-based company that produces a variety of products for the aerospace industry, including, among other products, aircraft generators, aircraft engine control systems and components, landing gear and actuation systems. In 2010, Goodrich had revenues of approximately $7.2 billion.
As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Maribeth Petrizzi, Chief, Litigation II Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 8700, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may approve the proposed settlement upon finding it is in the public interest.
WASHINGTON — The Department of Justice announced today that it will require United Technologies Corporation (UTC) to divest certain assets used in the production of electrical power systems and aircraft engine control systems in order to proceed with its acquisition of Goodrich Corporation. At approximately $18.4 billion, the acquisition is the largest merger in the history of the aircraft industry. The department said that the acquisition, as originally proposed, likely would have resulted in higher prices, less favorable contractual terms and less innovation for several critical aircraft components, including generators, engines and engine control systems.
The department’s Antitrust Division filed a civil antitrust lawsuit today in the U.S. District Court for the District of Columbia to block the proposed acquisition. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive concerns alleged in the lawsuit.
"The acquisition as originally proposed would have lessened the vigorous competition that currently exists among manufacturers of large main engine generators, aircraft turbine engines and engine control systems for large aircraft turbine engines," said Jamillia Ferris, Chief of Staff and Counsel at the Department of Justice’s Antitrust Division.
The department’s Antitrust Division, the European Commission and the Canadian Competition Bureau cooperated closely throughout the course of their respective investigations, with frequent contact among the agencies. In addition, the Antitrust Division had discussions with other competition agencies, including the Federal Competition Commission in Mexico and the Administrative Council for Economic Defense in Brazil.
"The Antitrust Division’s dialogue with our international counterparts around the world facilitated our investigation," said Ferris. "In particular, the division’s close cooperation with the European Commission and Canadian Competition Bureau resulted in a coordinated remedy that will preserve competition in the United States and internationally."
The department’s complaint alleges that the proposed acquisition would lessen competition substantially in the worldwide markets for the development, manufacture and sale of large main engine generators, aircraft turbine engines and engine control systems for large aircraft turbine engines. The department said that the acquisition, as originally proposed, would combine the only two significant suppliers of large main engine generators for aircraft in the world. UTC also would acquire Goodrich’s engine control systems business, which supplies critical components to several of UTC’s leading competitors for aircraft turbine engines. Finally, UTC, which is currently one of three leading suppliers of engine control systems for large aircraft turbine engines, would acquire Goodrich’s 50 percent share in a joint venture that forms one of the other two producers of such engine control systems.
Aircraft main engine generators produce the electrical power used by communication and navigation equipment, environmental control systems, interior and exterior lighting and other aircraft systems. Large main engine generators are complex mechanical devices that are difficult to produce, and for which there are no substitutes. Turbine engines power virtually all modern commercial, business and military aircraft. UTC is one of the few firms worldwide that produce aircraft turbine engines. Engine control systems, consisting of electronic engine controls, pumps, fuel metering units and related components, control the flow of fuel into an aircraft turbine engine such that the engine performs in a safe and efficient manner. It would be difficult and time-consuming for an engine producer to switch to an alternative supplier of engine control systems.
The proposed settlement requires UTC to divest the following assets:
Goodrich’s business that designs, develops and manufactures engine control systems; and
Goodrich’s shares in Aero Engine Controls (AEC), a joint venture to manufacture engine control systems for large aircraft turbine engines.
In addition, the proposed settlement provides:
UTC must provide various supply and transition services agreements to the acquirers of the assets being divested in order to assist in the transition of the businesses and allow the acquirers to continue to fulfill obligations of the divested businesses; and
UTC must extend the period for its joint venture partner, Rolls-Royce Group plc (Rolls Royce), to exercise its option to acquire the Goodrich business that provides aftermarket services for Rolls-Royce engines equipped with AEC engine control systems.
The extension of Rolls-Royce’s option to acquire the Goodrich aftermarket business will ensure that Rolls-Royce has sufficient control over the AEC aftermarket business. The extension of the customer contracts for the engine control systems business will ensure that Goodrich’s engine control systems customers have a reliable source of supply during the divestiture period.
UTC is a Delaware-based company that produces a wide range of products for the aerospace industry and other industries, including, among other products, aircraft generators, aircraft engine control systems and components, aircraft engines and helicopters. UTC’s main aerospace divisions are Pratt & Whitney, Hamilton Sundstrand and Sikorsky. In 2010, UTC had revenues of approximately $54 billion.
Goodrich is a New York-based company that produces a variety of products for the aerospace industry, including, among other products, aircraft generators, aircraft engine control systems and components, landing gear and actuation systems. In 2010, Goodrich had revenues of approximately $7.2 billion.
As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Maribeth Petrizzi, Chief, Litigation II Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 8700, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may approve the proposed settlement upon finding it is in the public interest.
Wednesday, July 25, 2012
JAPAN-BASED COMPANY TO PAY $127.5 MILLION TO SETTLE ALLEGATIONS OF MISLEADING INVESTORS
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
Mizuho to Pay $127.5 Million to Settle SEC Charges of Misleading Investors in CDOThe Securities and Exchange Commission has charged the U.S. investment banking subsidiary of Japan-based Mizuho Financial Group and three former employees with misleading investors in a collateralized debt obligation (CDO) by using "dummy assets" to inflate the deal’s credit ratings. The SEC also charged the firm that served as the deal’s collateral manager and the person who was its portfolio manager.
According to the SEC’s complaint filed July 18 against Mizuho Securities USA Inc., the firm made approximately $10 million in structuring and marketing fees in the deal. Mizuho agreed to pay $127.5 million to settle the SEC’s charges, and the others charged also agreed to settle the SEC’s actions against them.
The SEC alleges that Mizuho structured and marketed Delphinus CDO 2007-1, a CDO that was backed by subprime bonds at a time when the housing market was showing signs of severe distress. The deal was contingent upon Mizuho obtaining credit ratings it used to market the notes to investors. When its employees realized that Delphinus could not meet one rating agency’s newly announced criteria intended to protect CDO investors from the uncertainty of ratings downgrades, they submitted to the rating firm a portfolio containing millions of dollars in dummy assets that inaccurately reflected the collateral held by Delphinus. Once the firm rated the inaccurate portfolio, Mizuho closed the transaction and sold the notes to investors using the misleading ratings. Delphinus defaulted in 2008 and eventually was liquidated in 2010. Mizuho sustained substantial losses from Delphinus.
According to the SEC’s settled administrative proceedings against the three former Mizuho employees responsible for the Delphinus deal, Alexander Rekeda headed the group that structured the $1.6 billion CDO, Xavier Capdepon modeled the transaction for the rating agencies, and Gwen Snorteland was the transaction manager responsible for structuring and closing Delphinus. Delaware Asset Advisers (DAA) served as Delphinus’s collateral manager and the DAA portfolio manager was Wei (Alex) Wei.
Mizuho Securities USA Inc.According to the SEC’s complaint against Mizuho filed in federal court in Manhattan, all of the collateral assets for Delphinus had been purchased by July 17, 2007, and the transaction was scheduled to close on July 19. However, around noon on July 18, Standard & Poor’s (S&P) issued a press release announcing changes to its CDO rating criteria requiring certain categories of subprime residential mortgage-backed securities (RMBS) to be adjusted downward for purposes of calculating their default probability. The Mizuho employees knew that Delphinus’s actual portfolio contained a substantial amount of RMBS that were subject to the downward ratings, and that Delphinus, as constructed, could not meet its rating targets under these tougher standards. To enable Delphinus to close anyway, the Mizuho employees e-mailed multiple alternative portfolios to S&P that contained dummy assets that were superior in credit quality to the assets that had been actually acquired for the CDO. Once the necessary ratings were secured by the use of dummy assets, the Delphinus transaction closed by mid-afternoon on July 19 and securities were sold based upon these higher ratings. Investors were thus misled to believe that the Delphinus notes had achieved the advertised ratings that the actual closing portfolio would not support.
According to the SEC’s complaint, in connection with Delphinus’s subsequent request for a required rating confirmation from S&P, Mizuho employees provided and arranged for others to provide further inaccurate information about the composition of Delphinus’s assets. Primarily, they misrepresented that Delphinus’s effective date was August 6 rather than July 19. S&P then provided Delphinus with the ratings confirmation using the improper effective date of August 6.
As a result of Mizuho’s conduct, the SEC has alleged that Mizuho violated Sections 17(a)(2) and (3) of the Securities Act of 1933. Without admitting or denying the allegations of the SEC’s complaint, Mizuho agreed to settle by consenting to the entry of a final judgment that permanently enjoins Mizuho from violating those provisions of the Securities Act, and requires Mizuho to pay $10 million in disgorgement, $2.5 million in prejudgment interest and a $115 million penalty, for a total of $127.5 million. The settlement is subject to Court approval.
Rekeda, Capdepon, and SnortelandIn the related administrative proceedings against Rekeda, Capdepon, and Snorteland, the SEC found that Rekeda violated Sections 17(a)(2) and (3) of the Securities Act, and Capdepon and Snorteland violated Section 17(a). Rekeda and Capdepon each agreed to pay a $125,000 penalty while the decision on whether there will be a penalty for Snorteland will be decided at a later date. Rekeda agreed to be suspended from the securities industry for 12 months, Capdepon and Snorteland each agreed to be barred from the securities industry for one year, and all three agreed to cease and desist from further violations of the respective sections of the Securities Act they violated.
Delaware Asset Advisers and WeiIn related administrative proceedings against DAA and Wei, the SEC found that, as a result of the roles they played in providing misleading information in August and September 2007, DAA violated Sections 17(a)(2) and (3) of the Securities Act, and Section 206(2) of the Advisers Act, and Wei violated Section 17(a)(2) and (3) of the Securities Act, and caused DAA’s violation of Section 206(2) of the Advisers Act. Without admitting or denying the SEC’s findings: (1) DAA consented to the entry of an order requiring it to cease and desist from committing or causing violations or future violations of Sections 17(a)(2) and (3) of the Securities Act and Section 206(2) of the Advisers Act, and requiring it to pay disgorgement of $2,228,372, prejudgment interest of $357,776, and a civil money penalty of $2,228,372; and (2) Wei consented to the entry of an order requiring him to cease and desist from committing or causing violations or future violations of Sections 17(a)(2) and (3) of the Securities Act and Section 206(2) of the Advisers Act, suspending him from associating with any investment adviser for six months, and requiring him to pay a civil money penalty of $50,000.
The SEC’s investigation into the Delphinus transaction is continuing.
Mizuho to Pay $127.5 Million to Settle SEC Charges of Misleading Investors in CDOThe Securities and Exchange Commission has charged the U.S. investment banking subsidiary of Japan-based Mizuho Financial Group and three former employees with misleading investors in a collateralized debt obligation (CDO) by using "dummy assets" to inflate the deal’s credit ratings. The SEC also charged the firm that served as the deal’s collateral manager and the person who was its portfolio manager.
According to the SEC’s complaint filed July 18 against Mizuho Securities USA Inc., the firm made approximately $10 million in structuring and marketing fees in the deal. Mizuho agreed to pay $127.5 million to settle the SEC’s charges, and the others charged also agreed to settle the SEC’s actions against them.
The SEC alleges that Mizuho structured and marketed Delphinus CDO 2007-1, a CDO that was backed by subprime bonds at a time when the housing market was showing signs of severe distress. The deal was contingent upon Mizuho obtaining credit ratings it used to market the notes to investors. When its employees realized that Delphinus could not meet one rating agency’s newly announced criteria intended to protect CDO investors from the uncertainty of ratings downgrades, they submitted to the rating firm a portfolio containing millions of dollars in dummy assets that inaccurately reflected the collateral held by Delphinus. Once the firm rated the inaccurate portfolio, Mizuho closed the transaction and sold the notes to investors using the misleading ratings. Delphinus defaulted in 2008 and eventually was liquidated in 2010. Mizuho sustained substantial losses from Delphinus.
According to the SEC’s settled administrative proceedings against the three former Mizuho employees responsible for the Delphinus deal, Alexander Rekeda headed the group that structured the $1.6 billion CDO, Xavier Capdepon modeled the transaction for the rating agencies, and Gwen Snorteland was the transaction manager responsible for structuring and closing Delphinus. Delaware Asset Advisers (DAA) served as Delphinus’s collateral manager and the DAA portfolio manager was Wei (Alex) Wei.
Mizuho Securities USA Inc.According to the SEC’s complaint against Mizuho filed in federal court in Manhattan, all of the collateral assets for Delphinus had been purchased by July 17, 2007, and the transaction was scheduled to close on July 19. However, around noon on July 18, Standard & Poor’s (S&P) issued a press release announcing changes to its CDO rating criteria requiring certain categories of subprime residential mortgage-backed securities (RMBS) to be adjusted downward for purposes of calculating their default probability. The Mizuho employees knew that Delphinus’s actual portfolio contained a substantial amount of RMBS that were subject to the downward ratings, and that Delphinus, as constructed, could not meet its rating targets under these tougher standards. To enable Delphinus to close anyway, the Mizuho employees e-mailed multiple alternative portfolios to S&P that contained dummy assets that were superior in credit quality to the assets that had been actually acquired for the CDO. Once the necessary ratings were secured by the use of dummy assets, the Delphinus transaction closed by mid-afternoon on July 19 and securities were sold based upon these higher ratings. Investors were thus misled to believe that the Delphinus notes had achieved the advertised ratings that the actual closing portfolio would not support.
According to the SEC’s complaint, in connection with Delphinus’s subsequent request for a required rating confirmation from S&P, Mizuho employees provided and arranged for others to provide further inaccurate information about the composition of Delphinus’s assets. Primarily, they misrepresented that Delphinus’s effective date was August 6 rather than July 19. S&P then provided Delphinus with the ratings confirmation using the improper effective date of August 6.
As a result of Mizuho’s conduct, the SEC has alleged that Mizuho violated Sections 17(a)(2) and (3) of the Securities Act of 1933. Without admitting or denying the allegations of the SEC’s complaint, Mizuho agreed to settle by consenting to the entry of a final judgment that permanently enjoins Mizuho from violating those provisions of the Securities Act, and requires Mizuho to pay $10 million in disgorgement, $2.5 million in prejudgment interest and a $115 million penalty, for a total of $127.5 million. The settlement is subject to Court approval.
Rekeda, Capdepon, and SnortelandIn the related administrative proceedings against Rekeda, Capdepon, and Snorteland, the SEC found that Rekeda violated Sections 17(a)(2) and (3) of the Securities Act, and Capdepon and Snorteland violated Section 17(a). Rekeda and Capdepon each agreed to pay a $125,000 penalty while the decision on whether there will be a penalty for Snorteland will be decided at a later date. Rekeda agreed to be suspended from the securities industry for 12 months, Capdepon and Snorteland each agreed to be barred from the securities industry for one year, and all three agreed to cease and desist from further violations of the respective sections of the Securities Act they violated.
Delaware Asset Advisers and WeiIn related administrative proceedings against DAA and Wei, the SEC found that, as a result of the roles they played in providing misleading information in August and September 2007, DAA violated Sections 17(a)(2) and (3) of the Securities Act, and Section 206(2) of the Advisers Act, and Wei violated Section 17(a)(2) and (3) of the Securities Act, and caused DAA’s violation of Section 206(2) of the Advisers Act. Without admitting or denying the SEC’s findings: (1) DAA consented to the entry of an order requiring it to cease and desist from committing or causing violations or future violations of Sections 17(a)(2) and (3) of the Securities Act and Section 206(2) of the Advisers Act, and requiring it to pay disgorgement of $2,228,372, prejudgment interest of $357,776, and a civil money penalty of $2,228,372; and (2) Wei consented to the entry of an order requiring him to cease and desist from committing or causing violations or future violations of Sections 17(a)(2) and (3) of the Securities Act and Section 206(2) of the Advisers Act, suspending him from associating with any investment adviser for six months, and requiring him to pay a civil money penalty of $50,000.
The SEC’s investigation into the Delphinus transaction is continuing.
BAKED-GOODS CO. TO PAY BACK WAGES FOR DISCHARGING WORKERS FOR TRYING TO ORGANIZE A UNION
FROM: NATIONAL LABOR RELATIONS BOARD
Baked-goods manufacturer Sterling Foods, LLC, has agreed to pay more than $58,000 in back pay and interest to six employees who were discharged in the fall of 2011 following a union organizing campaign. Three of the employees have also accepted offers of reinstatement to their previous jobs.
The United Food and Commercial Workers Local Union No. 455 filed charges alleging the employer engaged in multiple unfair labor practices during and after the union’s attempt to organize about 500 employees at the San Antonio, Texas facility. An election petition was not filed.
Following an investigation by regional staff, NLRB Regional Director Martha Kinard issued a complaint alleging that, in response to the union’s campaign, Sterling Foods unlawfully discharged six employees, threatened to terminate other employees, solicited an employee to report on union activities, offered an employee a financial benefit if he reported the union activities of employees, engaged in surveillance of employee union activities, called the police on employees and union organizers engaged in union activity, prohibited employees from accepting union literature and directed employees to throw away union literature. A hearing on the complaint had been scheduled to start on August 6, 2012 in San Antonio.
The Regional Director had also filed a petition with the U. S. District Court for the Western District of Texas, San Antonio Division, seeking a temporary injunction against Sterling Foods’ unfair labor practices and an interim order of reinstatement of the six discharged employees. A hearing on that petition had been scheduled for July 19, 2012.
The settlement, signed on July 13, 2012, eliminates the need for both hearings. Sterling Foods also agreed not to engage in such unfair labor practices in the future, to post a notice to that effect at its San Antonio facility, and to mail a copy of the notice to all employees.
Baked-goods manufacturer Sterling Foods, LLC, has agreed to pay more than $58,000 in back pay and interest to six employees who were discharged in the fall of 2011 following a union organizing campaign. Three of the employees have also accepted offers of reinstatement to their previous jobs.
The United Food and Commercial Workers Local Union No. 455 filed charges alleging the employer engaged in multiple unfair labor practices during and after the union’s attempt to organize about 500 employees at the San Antonio, Texas facility. An election petition was not filed.
Following an investigation by regional staff, NLRB Regional Director Martha Kinard issued a complaint alleging that, in response to the union’s campaign, Sterling Foods unlawfully discharged six employees, threatened to terminate other employees, solicited an employee to report on union activities, offered an employee a financial benefit if he reported the union activities of employees, engaged in surveillance of employee union activities, called the police on employees and union organizers engaged in union activity, prohibited employees from accepting union literature and directed employees to throw away union literature. A hearing on the complaint had been scheduled to start on August 6, 2012 in San Antonio.
The Regional Director had also filed a petition with the U. S. District Court for the Western District of Texas, San Antonio Division, seeking a temporary injunction against Sterling Foods’ unfair labor practices and an interim order of reinstatement of the six discharged employees. A hearing on that petition had been scheduled for July 19, 2012.
The settlement, signed on July 13, 2012, eliminates the need for both hearings. Sterling Foods also agreed not to engage in such unfair labor practices in the future, to post a notice to that effect at its San Antonio facility, and to mail a copy of the notice to all employees.
Tuesday, July 24, 2012
BP AND THE U.S. DEPARTMENT OF LABOR SETTLEMENT
FROM: U.S. DEPARTMENT OF LABOR
BP to Pay More Than $13 Million in Settlement Agreement
BP Products North America Inc. and the Occupational Safety and Health Administration have resolved 409 of 439 citations issued by OSHA after an October 2009 inspection, Secretary Solis announced July 12. The inspection followed up on previous citations and a settlement that grew out of a 2005 explosion at a refinery that killed 15 workers. BP has or will address all covered violations by the end of 2012, and will pay more than $13 million in penalties. Solis was joined by Deputy Assistant Secretary of Labor for Occupational Safety and Health Jordan Barab in a teleconference call announcing the agreement. "For the workers at BP's Texas City refinery, this settlement will help establish a culture of safety," Solis said. "The workers who help keep our nation's oil and gas industries running deserve to go to work each day without fear of losing their lives."
BP to Pay More Than $13 Million in Settlement Agreement
BP Products North America Inc. and the Occupational Safety and Health Administration have resolved 409 of 439 citations issued by OSHA after an October 2009 inspection, Secretary Solis announced July 12. The inspection followed up on previous citations and a settlement that grew out of a 2005 explosion at a refinery that killed 15 workers. BP has or will address all covered violations by the end of 2012, and will pay more than $13 million in penalties. Solis was joined by Deputy Assistant Secretary of Labor for Occupational Safety and Health Jordan Barab in a teleconference call announcing the agreement. "For the workers at BP's Texas City refinery, this settlement will help establish a culture of safety," Solis said. "The workers who help keep our nation's oil and gas industries running deserve to go to work each day without fear of losing their lives."
Monday, July 23, 2012
CFTC ORDERS COMPANY TO PAY FINE FOR FOREX REGISTRATION VIOLATIONS
FROM: COMMODITY FUTURES TRADING COMMISSION
CFTC Orders LMC Asset Management, Inc. to Pay $140,000 Civil Penalty for Forex Registration Violations
Washington DC – The U.S. Commodity Futures Trading Commission (CFTC) today issued an order settling charges that LMC Asset Management, Inc. (LMC) of Deerfield Beach, Fla., exercised discretionary trading authority over customers’ accounts in retail, leveraged foreign currency (forex) transactions, without being registered with the CFTC as a Commodity Trading Advisor (CTA).The CFTC order finds that from at least October 18, 2010, to at least October 21, 2011, LMC exercised discretionary trading authority over accounts of persons who were not eligible contract participants (ECPs) in forex transactions without being registered with the CFTC as a CTA. As a result of LMC’s solicitations, 36 non-ECP customers opened forex trading accounts, with deposits totaling approximately $455,155.22.
The CFTC order requires LMC to pay a $140,000 civil monetary penalty and to cease and desist from further violations the Commodity Exchange Act and CFTC regulations, as charged. The order also prohibits LMC from entering into any commodity-related transactions, soliciting or accepting funds from any person for transactions involving commodity futures, commodity options, security futures products and/or forex contracts, and from trading or applying for registration, among other sanctions, until it has paid the civil monetary penalty.
On October 18, 2010, the CFTC enacted new regulations implementing certain provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the 2008 Farm Bill, regarding off-exchange retail forex transactions, including requiring CTAs to register before exercising discretionary trading authority over accounts of non-ECPs. According to the order, LMC failed to register as a CTA after October 18, 2010, as required, because it exercised discretionary trading authority over accounts of individuals who were not ECPs in connection with retail forex transactions.
The CFTC appreciates the assistance of the U.K. Financial Services Authority in this matter.
CFTC Division of Enforcement staff responsible for this case are Sophia Siddiqui, Timothy J. Mulreany, Michael Amakor, Elizabeth Padgett, Paul Hayeck, and Joan Manley.
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