FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
Securities and Exchange Commission v. Glenn Hoppes, United States Energy Corp., TN-KY Development Fund LP, TN-KY Development Fund II LP and TN-KY Development Fund III LP, Civil Action No. 13-CV-00868-SDM-AEP
The Securities and Exchange Commission today announced it has filed a civil injunctive action against Glenn Hoppes, of Clearwater, Florida, and four companies he controls, United States Energy Corp., TN-KY Development Fund LP, TN-KY Development Fund II LP and TN-KY Development Fund III LP, for fraudulently offering unregistered investments in oil drilling projects.
The SEC’s complaint alleges Hoppes hired Joseph Hilton to sell limited partnership units in three oil drilling projects in 2011 and 2012 and financially supported Hilton’s boiler room despite knowing Hilton was barred from acting as a broker by a 2008 SEC enforcement action and was using an alias to avoid association with the prior SEC action. Through Hilton’s efforts, US Energy raised approximately $2.5 million from approximately 100 investors. The US Energy securities offerings were not registered with the SEC as required under the federal securities laws.
According to the SEC’s complaint, Glenn Hoppes also made misrepresentations to investors in the sale of the units. Hoppes misled investors about US Energy’s oil well assets and omitted information from offering material concerning his personal bankruptcy and the prior SEC action against Hilton. The SEC brought an emergency action against Hilton in 2012 for violations of the antifraud and registration provisions of the federal securities laws in connection with his conduct at US Energy and at a subsequent company he founded.
The SEC’s complaint charges Hoppes, US Energy, TN-KY I, TN-KY II and TN-KY III with violations of Sections 5(a) and (c) and 17(a)(2) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5(b). The complaint also charges Hoppes and US Energy with violations of 17(a)(1) and (3) of the Securities Act and Exchange Act Rule 10b-5(a) and (c) and with aiding and abetting Hilton’s Exchange Act Section 15(a) violations. The SEC is seeking disgorgement of ill-gotten gains plus prejudgment interest, civil penalties, and permanent injunctions against Hoppes and his entities.
Showing posts with label UNREGISTERED SECURITIES. Show all posts
Showing posts with label UNREGISTERED SECURITIES. Show all posts
Saturday, April 13, 2013
Saturday, February 11, 2012
ILLIONOIS MAN CHARGED BY SEC WITH OFFERING UNREGISTERED SECURITIES IN THREE COMPANIES
The following excerpt is from the SEC website:
“On February 6, 2012, the Securities and Exchange Commission charged Glencoe, Illinois resident Kenneth A. Dachman with misappropriating over $1.8 million in investor funds and making false and misleading statements to investors in offerings for three companies for which he was the Chairman – Central Sleep Diagnostics, LLC (Central Sleep), Central Sleep Diagnostics of Florida, LLC (Central Sleep Florida), and Advanced Sleep Devices, LLC (Advanced Sleep). The SEC also charged Scott A. Wolf and his company, Stone Lion Management, Inc., the brokers for the three offerings, for their roles in selling unregistered securities to investors.
Filed in the U.S. District Court for the Northern District of Illinois, the SEC’s complaint alleges that between July 2008 and June 2010, Dachman raised at least $3,594,709 from investors located in 13 states and 12 foreign countries on behalf of Central Sleep, a purported provider of outpatient diagnostic sleep studies. Between December 2008 and April 2010, Dachman raised an additional $567,399 on behalf of Central Sleep Florida, a purported expansion of Central Sleep into Florida, and Advanced Sleep, a purported provider of medical devices. According to the complaint, Dachman made numerous misrepresentations to investors in each of the companies, including misrepresentations about how their funds would be used and his academic and business backgrounds. Dachman also failed to tell investors that he misappropriated at least $1,875,739 of their funds, over 45% of the total funds raised. According to the SEC’s complaint, among other things, Dachman used investor funds to rent-to-own a 10,000 square foot home, to pay for family vacations to Alaska, Europe and elsewhere, to purchase a new Range Rover, books, collectibles and antiques, and for personal expenses and credit card bills. Dachman also diverted investor funds to a tattoo parlor that he co-owned with his son-in-law.
The SEC’s complaint further alleges that Wolf and Stone Lion acted as unregistered brokers in selling unregistered securities to investors without qualifying for an exemption from the SEC’s registration provisions. The SEC alleges that Dachman violated Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and that Wolf and Stone Lion violated Sections 5(a) and 5(c) of the Securities Act and Section 15(a)(1) of the Exchange Act. The complaint seeks permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, civil penalties, and penny stock bars.
Wolf and Stone Lion each have agreed to settle the SEC’s charges without admitting or denying the allegations against them. Wolf and Stone Lion have consented to the entry of final judgments permanently enjoining them from violating Sections 5(a) and 5(c) of the Securities Act and Section 15(a)(1) of the Exchange Act. Wolf also has agreed to pay disgorgement of $335,216, prejudgment interest of $16,268, and a penalty of $20,000, and to be barred from participating in an offering of penny stock for one year. The proposed settlements are subject to the approval of the District Court.
The SEC thanks the U.S. Attorney’s Office for the Northern District of Illinois and the Federal Bureau of Investigation for their assistance in this matter.”
Sunday, December 18, 2011
CORPORATION ET. AL. PAY MILLIONS IN FINES AND DISGORGEMENT MONEY
The following is an excerpt from the SEC web site:
November 15, 2011
“The Securities and Exchange Commission announced today that on November 8, 2011, the U.S. District Court for the Northern District of Texas ruled that Timothy Page, of Malibu, California, and his company Testre LP are liable for violating the registration provisions of the federal securities laws. The Court ordered Page to pay $2.49 million in disgorgement and $400,284 in prejudgment interest. The Court also ordered three relief defendants - Reagan Rowland and Rodney Rowland, of Los Angeles, California, and John Coutris, of Irving, Texas - to pay back their ill-gotten gains.
The Commission's complaint alleged that Page and Testre violated the registration provisions of the federal securities laws when they engaged in an unregistered public offering of ConnectAJet.com, Inc., a reverse-merger company that claimed it would "revolutionize the aviation industry" by creating a real-time, online booking system for private jet travel. The Commission alleged that Page and his collaborators purchased tens of millions of shares directly from ConnectAJet.com, Inc. for pennies per share, under a purported registration exemption under the Securities Exchange Act of 1933, Regulation D, Rule 504. The Commission alleged that Page then touted the stock to investors through a national marketing campaign and dumped his shares into the public market when no registration statement was filed or in effect.
The Court ruled that Page and Testre violated Section 5 of the Securities Act of 1933. In addition to the monetary relief granted by the Court, the Commission continues to seek the following additional relief against Page and Testre: civil penalties, penny stock bars, and injunctions from future violations of Section 5 of the Securities Act of 1933. Reagan Rowland and Rodney Rowland were ordered to pay $138,219 and John Coutris was ordered to pay $281,840 in ill-gotten gains they received from Ryan Reynolds, one of Page's collaborators.
The Commission acknowledges the assistance of the Financial Industry Regulatory Authority (FINRA) in this matter.”
November 15, 2011
“The Securities and Exchange Commission announced today that on November 8, 2011, the U.S. District Court for the Northern District of Texas ruled that Timothy Page, of Malibu, California, and his company Testre LP are liable for violating the registration provisions of the federal securities laws. The Court ordered Page to pay $2.49 million in disgorgement and $400,284 in prejudgment interest. The Court also ordered three relief defendants - Reagan Rowland and Rodney Rowland, of Los Angeles, California, and John Coutris, of Irving, Texas - to pay back their ill-gotten gains.
The Commission's complaint alleged that Page and Testre violated the registration provisions of the federal securities laws when they engaged in an unregistered public offering of ConnectAJet.com, Inc., a reverse-merger company that claimed it would "revolutionize the aviation industry" by creating a real-time, online booking system for private jet travel. The Commission alleged that Page and his collaborators purchased tens of millions of shares directly from ConnectAJet.com, Inc. for pennies per share, under a purported registration exemption under the Securities Exchange Act of 1933, Regulation D, Rule 504. The Commission alleged that Page then touted the stock to investors through a national marketing campaign and dumped his shares into the public market when no registration statement was filed or in effect.
The Court ruled that Page and Testre violated Section 5 of the Securities Act of 1933. In addition to the monetary relief granted by the Court, the Commission continues to seek the following additional relief against Page and Testre: civil penalties, penny stock bars, and injunctions from future violations of Section 5 of the Securities Act of 1933. Reagan Rowland and Rodney Rowland were ordered to pay $138,219 and John Coutris was ordered to pay $281,840 in ill-gotten gains they received from Ryan Reynolds, one of Page's collaborators.
The Commission acknowledges the assistance of the Financial Industry Regulatory Authority (FINRA) in this matter.”
Thursday, November 17, 2011
CORPORATE PRINCIPALS PAY $1 MILLION DOLLARS TO SETTLE SEC CHARGES
The following excerpt is from the SEC website:
November 17, 2011
“The Securities and Exchange Commission announced today that the United States District Court for the Southern District of Florida entered final judgments, dated November 10, 2011, against Frank C. Calmes, Lynn D. Rowntree, and James E. Pratt. Calmes and Rowntree had been principals at First Equity Corporation, a Boca Raton company that took small companies public via reverse mergers. Pratt, a lawyer, provided legal opinions regarding the ability to sell stock in the newly public companies.
According to the SEC’s Complaint, Calmes, Rowntree, and Pratt, along with co-defendant Manny J. Shulman, illegally sold millions of shares of unregistered securities in violation of the registration provisions of the Securities Act of 1933 (“Securities Act”). In addition, Calmes, Rowntree, and Shulman were alleged to have committed fraud in selling securities, in violation of Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 thereunder. Calmes, Rowntree, and Pratt entered into bifurcated settlements with the SEC in May of 2011, just before a jury trial was to begin. Under the bifurcated settlements, Calmes and Rowntree agreed to be permanently enjoined from violating Sections 5(a) and 5(c) of the Securities Act, Section 10(b) of the Exchange Act, and Rule 10b-5 thereunder, while Pratt agreed to be permanently enjoined from violating Sections 5(a) and 5(c) of the Securities Act. All three agreed to be barred from participating in any penny stock offering, and to cancel any shares of the corporations at issue in their possession or control. In addition, Defendant Calmes consented to be permanently barred from acting as an officer or director of any public issuer.
The bifurcated settlements left open, and the final judgments entered last week addressed, defendants’ liability for disgorgement of ill-gotten gains, prejudgment interest thereon, and the imposition of penalties. The final judgments imposed the following relief: against Calmes, $1,886,918 in disgorgement, $468,441 in prejudgment interest, and a $5,000 penalty; against Rowntree, $693,948 in disgorgement, $157,411 in prejudgment interest, and a $5,000 penalty; and against Pratt, $258,796 in disgorgement, $64,247 in prejudgment interest, and a $5,000 penalty.
Shulman proceeded to trial and on May 9, 2011 the jury returned a verdict finding him liable for violating Sections 5(a) and 5(c) of the Securities Act by selling uregistered securities and for violating Section 10(b) of the Exchange Act and Rule 10b-5 thereunder by issuing materially false and misleading press releases regarding a company whose shares he was selling. On July 12, 2011, the Court enjoined Shulman from further violations of the federal securities laws, permanently barred Shulman from participating in any penny stock offering or acting as an officer or director of any public issuer, ordered disgorgement of $273,152, ordered payment of prejudgment interest of $95,633.44, and imposed a $5,000 penalty. The Court further ordered Shulman’s wife, Krystal Becnel, who was named as a relief defendant in the SEC’s Complaint, to disgorge $131,914.”
November 17, 2011
“The Securities and Exchange Commission announced today that the United States District Court for the Southern District of Florida entered final judgments, dated November 10, 2011, against Frank C. Calmes, Lynn D. Rowntree, and James E. Pratt. Calmes and Rowntree had been principals at First Equity Corporation, a Boca Raton company that took small companies public via reverse mergers. Pratt, a lawyer, provided legal opinions regarding the ability to sell stock in the newly public companies.
According to the SEC’s Complaint, Calmes, Rowntree, and Pratt, along with co-defendant Manny J. Shulman, illegally sold millions of shares of unregistered securities in violation of the registration provisions of the Securities Act of 1933 (“Securities Act”). In addition, Calmes, Rowntree, and Shulman were alleged to have committed fraud in selling securities, in violation of Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 thereunder. Calmes, Rowntree, and Pratt entered into bifurcated settlements with the SEC in May of 2011, just before a jury trial was to begin. Under the bifurcated settlements, Calmes and Rowntree agreed to be permanently enjoined from violating Sections 5(a) and 5(c) of the Securities Act, Section 10(b) of the Exchange Act, and Rule 10b-5 thereunder, while Pratt agreed to be permanently enjoined from violating Sections 5(a) and 5(c) of the Securities Act. All three agreed to be barred from participating in any penny stock offering, and to cancel any shares of the corporations at issue in their possession or control. In addition, Defendant Calmes consented to be permanently barred from acting as an officer or director of any public issuer.
The bifurcated settlements left open, and the final judgments entered last week addressed, defendants’ liability for disgorgement of ill-gotten gains, prejudgment interest thereon, and the imposition of penalties. The final judgments imposed the following relief: against Calmes, $1,886,918 in disgorgement, $468,441 in prejudgment interest, and a $5,000 penalty; against Rowntree, $693,948 in disgorgement, $157,411 in prejudgment interest, and a $5,000 penalty; and against Pratt, $258,796 in disgorgement, $64,247 in prejudgment interest, and a $5,000 penalty.
Shulman proceeded to trial and on May 9, 2011 the jury returned a verdict finding him liable for violating Sections 5(a) and 5(c) of the Securities Act by selling uregistered securities and for violating Section 10(b) of the Exchange Act and Rule 10b-5 thereunder by issuing materially false and misleading press releases regarding a company whose shares he was selling. On July 12, 2011, the Court enjoined Shulman from further violations of the federal securities laws, permanently barred Shulman from participating in any penny stock offering or acting as an officer or director of any public issuer, ordered disgorgement of $273,152, ordered payment of prejudgment interest of $95,633.44, and imposed a $5,000 penalty. The Court further ordered Shulman’s wife, Krystal Becnel, who was named as a relief defendant in the SEC’s Complaint, to disgorge $131,914.”
Saturday, October 15, 2011
SECURITY COMPANY ALLEGEDLY OFFERED UNREGISTERED SECURITIES
The following is an excerpt from the SEC website:
“On October 7, 2011, United States District Judge John G. Koeltl entered an order, consistent with a stipulated agreement between the Commission and Defendants, preliminarily enjoining Murdoch Security & Investigations, Inc. (“Murdoch”) and its two principal officers, Robert Goldstein and William Vassell from continuing an allegedly illegal, unregistered offering and sale of securities that the Commission alleges raised more than $1 million from noteholders, who were promised 22% annual interest on their investments. Judge Koeltl’s order also preliminarily enjoined Defendants Murdoch and Goldstein from further violations of certain anti-fraud provisions of the federal securities laws and froze certain of Defendants’ assets pending final disposition of the case.
The Commission’s complaint, filed in the U.S. District Court for the Southern District of New York, alleges that Defendants, beginning in approximately October 2010, offered and sold notes to investors by placing advertisements in the Wall Street Journal and other financial press. The Commission further alleges that Murdoch, through Goldstein, misrepresented material facts to investors about the security company, including boasts of highly lucrative overseas operations when, in fact, Murdoch lacked any international business whatsoever.
According to the Commission’s complaint, Murdoch told investors that capital was needed to finance acquisitions of additional security companies that would enhance Murdoch’s overall revenues and fund 22% interest payments to noteholders. In reality, the Commission alleges, money from new investors has been used primarily to fund interest payments to earlier investors and to pay the salaries of Defendants Goldstein and Vassell.
The Commission’s complaint charges each Defendant with violations of Sections 5(a) and 5(c) of the Securities Act of 1933, and Defendants Murdoch and Goldstein with violations of Section 17(a) of the Securities Act, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
The Commission is seeking permanent injunctions against the defendants, and to have them return their allegedly ill-gotten gains with prejudgment interest, and pay civil monetary penalties.
The Commission acknowledges the assistance of the New York District Attorney’s Office in connection with this matter.”
“On October 7, 2011, United States District Judge John G. Koeltl entered an order, consistent with a stipulated agreement between the Commission and Defendants, preliminarily enjoining Murdoch Security & Investigations, Inc. (“Murdoch”) and its two principal officers, Robert Goldstein and William Vassell from continuing an allegedly illegal, unregistered offering and sale of securities that the Commission alleges raised more than $1 million from noteholders, who were promised 22% annual interest on their investments. Judge Koeltl’s order also preliminarily enjoined Defendants Murdoch and Goldstein from further violations of certain anti-fraud provisions of the federal securities laws and froze certain of Defendants’ assets pending final disposition of the case.
The Commission’s complaint, filed in the U.S. District Court for the Southern District of New York, alleges that Defendants, beginning in approximately October 2010, offered and sold notes to investors by placing advertisements in the Wall Street Journal and other financial press. The Commission further alleges that Murdoch, through Goldstein, misrepresented material facts to investors about the security company, including boasts of highly lucrative overseas operations when, in fact, Murdoch lacked any international business whatsoever.
According to the Commission’s complaint, Murdoch told investors that capital was needed to finance acquisitions of additional security companies that would enhance Murdoch’s overall revenues and fund 22% interest payments to noteholders. In reality, the Commission alleges, money from new investors has been used primarily to fund interest payments to earlier investors and to pay the salaries of Defendants Goldstein and Vassell.
The Commission’s complaint charges each Defendant with violations of Sections 5(a) and 5(c) of the Securities Act of 1933, and Defendants Murdoch and Goldstein with violations of Section 17(a) of the Securities Act, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
The Commission is seeking permanent injunctions against the defendants, and to have them return their allegedly ill-gotten gains with prejudgment interest, and pay civil monetary penalties.
The Commission acknowledges the assistance of the New York District Attorney’s Office in connection with this matter.”
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