The following is an excerpt from the SEC website:
“The Securities and Exchange Commission announced today that the United States District Court for the District of Kansas entered a judgment, dated September 8, 2011, against Kyle L. Garst, the former chief executive officer of Kansas-based Brooke Capital Corporation (“Brooke Capital”). Brooke Capital was an insurance agency franchisor and a subsidiary of Brooke Corporation, a Kansas company founded by Robert Orr. Garst, without admitting or denying the Commission’s allegations, consented to a judgment enjoining him from future violations of the federal securities laws.
According to the SEC’s Complaint, in SEC filings signed by Garst, Brooke Capital’s former management inflated the number of reported insurance agency franchise locations by including failed and abandoned locations in totals set forth in SEC filings for year-end 2007 and the first quarter of 2008. The Complaint also alleges that Brooke Capital’s former management, among other things, concealed the nature and extent of Brooke Capital’s financial assistance to its franchisees, which included making franchise loan payments on behalf of struggling franchisees, and failed to disclose the company’s dire liquidity and financial condition.
Specifically, the judgment enjoins Garst from violating Sections 17(a)(1) and 17(a)(3) of the Securities Act of 1933, and Sections 10(b) and 13(b)(5) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rules 10b-5, 13b2-1, 13b2-2, and 13a-14 thereunder, and from aiding and abetting violations Sections 13(a), 13(b)(2)(A), and 13(b)(2)(B) of the Exchange Act and Rules 12b-20, 13a-1, and 13a-13 thereunder. In addition to the injunction, the judgment bars Garst from serving as an officer or director of a public company and imposes a $130,000 civil penalty.”
Saturday, September 10, 2011
Tuesday, September 6, 2011
NEW GOLDEN INVESTMENT GROUP, LLC AND PRINCIPALS ARE JUDGED
July 28, 2011
The following is an excerpt from the SEC website:
"Washington, DC
The judgments arise from a CFTC complaint filed in the U.S. District Court for the Central District of California, Western Division, on May 20, 2010, charging NGI, Gonzalez, and Naranjo with fraud and misappropriation in connection with a multi-million dollar Ponzi scheme (see CFTC Press Release 5828-10, May 2011). The CFTC’s complaint charged that the defendants fraudulently solicited and accepted approximately $3.65 million from at least 165 members of the Los Angeles-area Spanish speaking community for various investments, including commodity futures trading. Gonzalez and Naranjo were also charged with misappropriating hundreds of thousands of dollars of investor funds for their personal use.
The judgments against Gonzales, NGI, and Naranjo, entered on July 20, 2011, July 19, 2011, and February 15, 2011, respectively, impose permanent trading and registration bans on them. The orders require NGI and Naranjo each to pay $2,220,771.49 in restitution, NGI and Naranjo to pay disgorgement of $558,000 and 267,000, respectively, and civil monetary penalties of $1,674,000 and $801,000, respectively. Naranjo, a Mexican National, is believed to have fled the United States.
The judge ordered Gonzales to disgorge $249,000 and pay a $748,500 civil monetary penalty. Gonzalez was sentenced in December 2010 to more than 11 years imprisonment, after pleading guilty to fraud charges in a related criminal proceeding filed on the same day as the CFTC action (see United States v. Ruben Juan-Gonzalez, No. CR-10-0509-PA [C.D.Cal. filed May 20, 2010]). The criminal court ordered Gonzales to pay $2,220,771.49 in restitution to defrauded NGI pool participants for the same misconduct charged in the CFTC’s civil complaint.
The court’s judgments find that NGI, Gonzalez, and Naranjo solicited the Spanish speaking public in and around West Covina, Calif., to trade commodity futures and retail off-exchange foreign currency and falsely claimed that they would double their money within a year. In reality, NGI, Gonzalez, and Naranjo misappropriated over $1 million of customer funds to purchase a Mercedes-Benz, airline tickets, and to make house payments. The orders also find that NGI, Gonzalez, and Naranjo ran a Ponzi scheme using new investor money to pay phony profits to some existing investors.
The CFTC appreciates the assistance of the United States Attorney’s Office for the Central District of California and the Federal Bureau of Investigation.”
NOTE FROM CFTC: Gonzalez sentenced to more than 11 years imprisonment in a criminal proceeding for the same fraudulent scheme.— The U.S. Commodity Futures Trading Commission (CFTC) today announced that Judge Otis D. Wright II of the U.S. District Court for the Central District of California, Western Division, entered orders for default judgment and permanent injunction against defendants New Golden Investment Group, LLC (NGI) of West Covina, Calif., and its principals, Ruben Gonzalez also of West Covina, and Jose Naranjo, formerly of La Mirada, Calif.
The following is an excerpt from the SEC website:
"Washington, DC
The judgments arise from a CFTC complaint filed in the U.S. District Court for the Central District of California, Western Division, on May 20, 2010, charging NGI, Gonzalez, and Naranjo with fraud and misappropriation in connection with a multi-million dollar Ponzi scheme (see CFTC Press Release 5828-10, May 2011). The CFTC’s complaint charged that the defendants fraudulently solicited and accepted approximately $3.65 million from at least 165 members of the Los Angeles-area Spanish speaking community for various investments, including commodity futures trading. Gonzalez and Naranjo were also charged with misappropriating hundreds of thousands of dollars of investor funds for their personal use.
The judgments against Gonzales, NGI, and Naranjo, entered on July 20, 2011, July 19, 2011, and February 15, 2011, respectively, impose permanent trading and registration bans on them. The orders require NGI and Naranjo each to pay $2,220,771.49 in restitution, NGI and Naranjo to pay disgorgement of $558,000 and 267,000, respectively, and civil monetary penalties of $1,674,000 and $801,000, respectively. Naranjo, a Mexican National, is believed to have fled the United States.
The judge ordered Gonzales to disgorge $249,000 and pay a $748,500 civil monetary penalty. Gonzalez was sentenced in December 2010 to more than 11 years imprisonment, after pleading guilty to fraud charges in a related criminal proceeding filed on the same day as the CFTC action (see United States v. Ruben Juan-Gonzalez, No. CR-10-0509-PA [C.D.Cal. filed May 20, 2010]). The criminal court ordered Gonzales to pay $2,220,771.49 in restitution to defrauded NGI pool participants for the same misconduct charged in the CFTC’s civil complaint.
The court’s judgments find that NGI, Gonzalez, and Naranjo solicited the Spanish speaking public in and around West Covina, Calif., to trade commodity futures and retail off-exchange foreign currency and falsely claimed that they would double their money within a year. In reality, NGI, Gonzalez, and Naranjo misappropriated over $1 million of customer funds to purchase a Mercedes-Benz, airline tickets, and to make house payments. The orders also find that NGI, Gonzalez, and Naranjo ran a Ponzi scheme using new investor money to pay phony profits to some existing investors.
The CFTC appreciates the assistance of the United States Attorney’s Office for the Central District of California and the Federal Bureau of Investigation.”
NOTE FROM CFTC: Gonzalez sentenced to more than 11 years imprisonment in a criminal proceeding for the same fraudulent scheme.— The U.S. Commodity Futures Trading Commission (CFTC) today announced that Judge Otis D. Wright II of the U.S. District Court for the Central District of California, Western Division, entered orders for default judgment and permanent injunction against defendants New Golden Investment Group, LLC (NGI) of West Covina, Calif., and its principals, Ruben Gonzalez also of West Covina, and Jose Naranjo, formerly of La Mirada, Calif.
Monday, September 5, 2011
VA HAS ADDED MORE DISEASES TO LIST OF DISEASES CAUSED BY AGENT ORANGE
The following is an excerpt from the VA website:
"Last year, VA added ischemic heart disease, hairy cell leukemia and other chronic B-cell leukemias, and Parkinson’s disease to the list of diseases presumed to be related to exposure to Agent Orange in Vietnam. It was a long time coming for Veterans who have been debilitated by diseases they may have contracted as a result of their combat deployment. So far, over $2.2 billion has been paid to 89,000 Vietnam Vets and survivors who have filed claims.
Today, VA is recognizing many Vets who may have been exposed to Agent Orange by contact from operations on and off their Naval and Coast Guard vessels. An updated list of ships that navigated inland waterways, docked on shore, or had crewmembers sent ashore in Vietnam between January 9, 1962, and May 7, 1975 are listed alphabetically here.
If you served aboard any of those ships and have a disease linked to Agent Orange, you should file a claim immediately. You can file online through eBenefits after setting up a premium account. "
"Last year, VA added ischemic heart disease, hairy cell leukemia and other chronic B-cell leukemias, and Parkinson’s disease to the list of diseases presumed to be related to exposure to Agent Orange in Vietnam. It was a long time coming for Veterans who have been debilitated by diseases they may have contracted as a result of their combat deployment. So far, over $2.2 billion has been paid to 89,000 Vietnam Vets and survivors who have filed claims.
Today, VA is recognizing many Vets who may have been exposed to Agent Orange by contact from operations on and off their Naval and Coast Guard vessels. An updated list of ships that navigated inland waterways, docked on shore, or had crewmembers sent ashore in Vietnam between January 9, 1962, and May 7, 1975 are listed alphabetically here.
If you served aboard any of those ships and have a disease linked to Agent Orange, you should file a claim immediately. You can file online through eBenefits after setting up a premium account. "
Sunday, September 4, 2011
FEDERAL COURT FREEZES ASSETS OF FINANCIAL ROBOTICS INC., OF HOUSTON TEXAS
July 7, 2011
The following is an excerpt from the SEC website:
“Washington, DC
The order arises out of a CFTC civil complaint filed under seal on June 29, 2011 in the U.S. District Court for the Southern District of Texas. The complaint charges Rice and FinRob with fraudulently soliciting millions of dollars from at least one individual to trade off-exchange foreign currency (forex) through accounts that they managed. In their solicitations, the defendants allegedly falsely claimed that their investments were insured against loss. The defendants also falsely guaranteed the return of the principal amount invested, according to the complaint.”
- The U.S. Commodity Futures Trading Commission (CFTC) announced that a federal court in Houston entered an order freezing the assets of Mark E. Rice of Sugar Land, Texas, and his company, Financial Robotics, Inc. (FinRob) of Houston, Texas. The order, entered by Judge Lee H. Rosenthal, also prohibits the destruction of books and records and appoints a temporary receiver. The judge ordered Rice and FinRob to appear in court on July 28, 2011 for a preliminary injunction hearing.
The following is an excerpt from the SEC website:
“Washington, DC
The order arises out of a CFTC civil complaint filed under seal on June 29, 2011 in the U.S. District Court for the Southern District of Texas. The complaint charges Rice and FinRob with fraudulently soliciting millions of dollars from at least one individual to trade off-exchange foreign currency (forex) through accounts that they managed. In their solicitations, the defendants allegedly falsely claimed that their investments were insured against loss. The defendants also falsely guaranteed the return of the principal amount invested, according to the complaint.”
- The U.S. Commodity Futures Trading Commission (CFTC) announced that a federal court in Houston entered an order freezing the assets of Mark E. Rice of Sugar Land, Texas, and his company, Financial Robotics, Inc. (FinRob) of Houston, Texas. The order, entered by Judge Lee H. Rosenthal, also prohibits the destruction of books and records and appoints a temporary receiver. The judge ordered Rice and FinRob to appear in court on July 28, 2011 for a preliminary injunction hearing.
Friday, September 2, 2011
DOJ INCREASES ENFORCMENT OF FAIR LENDING LAWS
The following is an excerpt from the Department of Justice website:
Fair Lending
September 1st, 2011 Posted by Tracy Russo
In April, we told you about the Civil Rights Division’s increased efforts to combat lending discrimination with the establishment of a new Fair Lending Unit, and about strengthened partnerships with other federal agencies to more effectively enforce fair lending laws.
In recent months, these efforts have yielded a record number of fair lending enforcement actions. Since the beginning of May, the department has resolved or filed seven fair lending actions that protect individuals from unfair or discriminatory lending practices, more than the department has ever filed in such a short time period. The cases cover a variety of types of discrimination, and aim to remedy discrimination against a number of different communities.
Below are some highlights of our recent work.
Several of the cases have involved allegations of discrimination based on race or national origin:
On May 5, the Civil Rights Division announced a fair lending settlement with Citizens Republic Bancorp Inc. and Citizens Bank of Flint, Michigan, to resolve allegations of redlining. The division’s lawsuit, which was dismissed in light of the settlement, alleged that the bank failed to offer credit in African-American communities in the Detroit area on an equal basis with white communities. The bank agreed to open a loan production office in an African-American neighborhood in Detroit and invest approximately $3.6 million in Wayne County, Michigan.
On June 16, the division reached a fair lending settlement with Midwest BankCentre of St. Louis County, Missouri, to resolve allegations of redlining. The suit alleged that the bank failed to offer credit in African-American communities of the St. Louis area on an equal basis with white communities. The bank agreed to open a branch in an African-American neighborhood in St. Louis and invest approximately $1.45 million in those neighborhoods.
On June 17, the division settled another recent fair lending case against Nixon State Bank in Nixon, Texas, in which the lender was alleged to have charged higher prices on unsecured consumer loans made to Hispanic borrowers through the bank’s branch offices. As part of the settlement agreement, the bank agreed to establish uniform pricing policies to ensure non-discrimination, and to pay nearly $100,000 to Hispanic victims of discrimination.
Another recent case alleges discrimination against women on maternity leave:
On July 5, the division filed suit against the Mortgage Guaranty Insurance Corporation (MGIC), the nation’s largest mortgage insurance company, and two of its underwriters, alleging that MGIC required women on paid maternity leave to return to work before the company would insure their mortgages. Most mortgage lenders require applicants seeking to borrow more than 80 percent of their home’s value to obtain mortgage insurance, meaning MGIC’s denials to women on maternity leave could cost those women the opportunity to obtain a home loan.
The division has also taken aggressive action to protect our members of the military against unfair lending practices.
On May 26, the division announced two multi-million dollar settlements under Servicemembers Civil Relief Act (SCRA) resolving allegations that servicers unlawfully foreclosed on servicemembers. Both servicers also agreed to enact new policies and take other corrective action to ensure that in the future they fully comply with the (SCRA).
Bank of America/Countrywide agreed to pay a minimum of $20 million to resolve allegations that it unlawfully foreclosed on approximately 160 servicemembers. This is the largest SCRA settlement ever reached by the department.
Saxon Mortgage Services Inc., a subsidiary of Morgan Stanley, will pay a minimum of $2.35 million to resolve a lawsuit alleging that Saxon foreclosed on approximately 17 servicemembers.
On May 26, the division also resolved allegations that Bank of America charged servicemembers interest in excess of 6 percent on credit card debt, in violation of the SCRA.
The Fair Lending Unit works closely with the banking regulatory agencies, the Federal Trade Commission, and HUD, receiving from them fair lending referrals where the agency believes there is a pattern or practice of discrimination. In 2010, the division received 49 referrals from partner agencies, more than it had received in a single year in at least 20 years.
Critics of our increased enforcement efforts believe we must choose between vigorous enforcement of fair lending laws and a strong, sound climate for lending. This is a false choice. The truth is that fair lending enforcement is essential for a well functioning market where borrowers can access credit based on their qualifications and not be denied opportunity because of their race, national origin or gender.
In fact, the department’s enforcement efforts support sound lending practices. The department’s fair lending settlement agreements repeatedly refer to the extension of credit to “qualified applicants” only. The department makes clear that no provision in the agreements require banks to make any unsafe or unsound loan.
As we recover from our nation’s housing crisis, we all have a shared interest in ensuring that communities are rebuilt in a sustainable way that allows them to flourish not only in the near term, but for generations to come. This can only happen if all qualified homebuyers can access safe, sustainable credit, free from discrimination, on the same basis as their peers as is required by law. The Justice Department will unapologetically continue to ensure they can do so by vigorously enforcing fair lending laws.”
Fair Lending
September 1st, 2011 Posted by Tracy Russo
In April, we told you about the Civil Rights Division’s increased efforts to combat lending discrimination with the establishment of a new Fair Lending Unit, and about strengthened partnerships with other federal agencies to more effectively enforce fair lending laws.
In recent months, these efforts have yielded a record number of fair lending enforcement actions. Since the beginning of May, the department has resolved or filed seven fair lending actions that protect individuals from unfair or discriminatory lending practices, more than the department has ever filed in such a short time period. The cases cover a variety of types of discrimination, and aim to remedy discrimination against a number of different communities.
Below are some highlights of our recent work.
Several of the cases have involved allegations of discrimination based on race or national origin:
On May 5, the Civil Rights Division announced a fair lending settlement with Citizens Republic Bancorp Inc. and Citizens Bank of Flint, Michigan, to resolve allegations of redlining. The division’s lawsuit, which was dismissed in light of the settlement, alleged that the bank failed to offer credit in African-American communities in the Detroit area on an equal basis with white communities. The bank agreed to open a loan production office in an African-American neighborhood in Detroit and invest approximately $3.6 million in Wayne County, Michigan.
On June 16, the division reached a fair lending settlement with Midwest BankCentre of St. Louis County, Missouri, to resolve allegations of redlining. The suit alleged that the bank failed to offer credit in African-American communities of the St. Louis area on an equal basis with white communities. The bank agreed to open a branch in an African-American neighborhood in St. Louis and invest approximately $1.45 million in those neighborhoods.
On June 17, the division settled another recent fair lending case against Nixon State Bank in Nixon, Texas, in which the lender was alleged to have charged higher prices on unsecured consumer loans made to Hispanic borrowers through the bank’s branch offices. As part of the settlement agreement, the bank agreed to establish uniform pricing policies to ensure non-discrimination, and to pay nearly $100,000 to Hispanic victims of discrimination.
Another recent case alleges discrimination against women on maternity leave:
On July 5, the division filed suit against the Mortgage Guaranty Insurance Corporation (MGIC), the nation’s largest mortgage insurance company, and two of its underwriters, alleging that MGIC required women on paid maternity leave to return to work before the company would insure their mortgages. Most mortgage lenders require applicants seeking to borrow more than 80 percent of their home’s value to obtain mortgage insurance, meaning MGIC’s denials to women on maternity leave could cost those women the opportunity to obtain a home loan.
The division has also taken aggressive action to protect our members of the military against unfair lending practices.
On May 26, the division announced two multi-million dollar settlements under Servicemembers Civil Relief Act (SCRA) resolving allegations that servicers unlawfully foreclosed on servicemembers. Both servicers also agreed to enact new policies and take other corrective action to ensure that in the future they fully comply with the (SCRA).
Bank of America/Countrywide agreed to pay a minimum of $20 million to resolve allegations that it unlawfully foreclosed on approximately 160 servicemembers. This is the largest SCRA settlement ever reached by the department.
Saxon Mortgage Services Inc., a subsidiary of Morgan Stanley, will pay a minimum of $2.35 million to resolve a lawsuit alleging that Saxon foreclosed on approximately 17 servicemembers.
On May 26, the division also resolved allegations that Bank of America charged servicemembers interest in excess of 6 percent on credit card debt, in violation of the SCRA.
The Fair Lending Unit works closely with the banking regulatory agencies, the Federal Trade Commission, and HUD, receiving from them fair lending referrals where the agency believes there is a pattern or practice of discrimination. In 2010, the division received 49 referrals from partner agencies, more than it had received in a single year in at least 20 years.
Critics of our increased enforcement efforts believe we must choose between vigorous enforcement of fair lending laws and a strong, sound climate for lending. This is a false choice. The truth is that fair lending enforcement is essential for a well functioning market where borrowers can access credit based on their qualifications and not be denied opportunity because of their race, national origin or gender.
In fact, the department’s enforcement efforts support sound lending practices. The department’s fair lending settlement agreements repeatedly refer to the extension of credit to “qualified applicants” only. The department makes clear that no provision in the agreements require banks to make any unsafe or unsound loan.
As we recover from our nation’s housing crisis, we all have a shared interest in ensuring that communities are rebuilt in a sustainable way that allows them to flourish not only in the near term, but for generations to come. This can only happen if all qualified homebuyers can access safe, sustainable credit, free from discrimination, on the same basis as their peers as is required by law. The Justice Department will unapologetically continue to ensure they can do so by vigorously enforcing fair lending laws.”
Thursday, September 1, 2011
AFTERMARKET LIGHTS CORPORATION PLEADS GUILTY TO PRICE-FIXING
The following excerpt is from the Department of Justice website:
“WASHINGTON — A California aftermarket auto lights distributor has agreed to plead guilty today for its participation in a global conspiracy to fix the prices of aftermarket auto lights, the Department of Justice announced. Aftermarket auto lights are incorporated into an automobile after its original sale, often as repairs following a collision or as accessories and upgrades.
According to a one-count felony charge filed today in U.S. District Court in San Francisco, Sabry Lee (U.S.A.) Inc. conspired with others to suppress and eliminate competition by fixing the prices of aftermarket auto lights. The department said that Sabry Lee, a U.S. distributor for a Taiwan producer of aftermarket auto lights, participated in the conspiracy from about September 2003 until about September 2005. Under Sabry Lee’s plea agreement, which is subject to court approval, the company has agreed to pay a $200,000 criminal fine and to assist the department in its ongoing investigation into the aftermarket auto lights industry.
According to the charge, Sabry Lee and co-conspirators participated in a conspiracy in which the participants met and agreed to charge prices of aftermarket auto lights at certain predetermined levels. According to the court documents, the participants in the conspiracy issued price announcements and price lists in accordance with the agreements reached, and collected and exchanged information on prices and sales of aftermarket auto lights for the purpose of monitoring and enforcing adherence to the agreed-upon prices. The department said that the conspirators met in Taiwan, the United States and elsewhere for their discussions.
Sabry Lee is the first corporation to be charged in connection with the department’s ongoing investigation into the aftermarket auto lights industry. Three individuals have also been charged. Polo Shu-Sheng Hsu, the former president and chief executive officer of a U.S. distributor of aftermarket auto lights, entered his guilty plea on March 29, 2011, and was sentenced to serve 180 days in prison and to pay a $25,000 criminal fine. Chien Chung Chen, aka Andrew Chen, the former executive vice president of Sabry Lee, pleaded guilty to his participation in the conspiracy on June 7, 2011. He is currently scheduled to be sentenced on Dec. 13, 2011. Homy Hong-Ming Hsu was arrested at Los Angeles International Airport on July 12, 2011, and indicted on July 19, 2011. Homy Hong-Ming Hsu is the vice chairman and second highest-ranking officer of a Taiwan manufacturer of aftermarket auto lights.
Sabry Lee is charged with violating the Sherman Act, which carries a maximum penalty of a $100 million criminal fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims, if either of those amounts is greater than the statutory maximum fine.”
Fines and prison times for the executives and fines for the company. It seems that other companies and executives may meet the same fate since the investigation is ongoing.
“WASHINGTON — A California aftermarket auto lights distributor has agreed to plead guilty today for its participation in a global conspiracy to fix the prices of aftermarket auto lights, the Department of Justice announced. Aftermarket auto lights are incorporated into an automobile after its original sale, often as repairs following a collision or as accessories and upgrades.
According to a one-count felony charge filed today in U.S. District Court in San Francisco, Sabry Lee (U.S.A.) Inc. conspired with others to suppress and eliminate competition by fixing the prices of aftermarket auto lights. The department said that Sabry Lee, a U.S. distributor for a Taiwan producer of aftermarket auto lights, participated in the conspiracy from about September 2003 until about September 2005. Under Sabry Lee’s plea agreement, which is subject to court approval, the company has agreed to pay a $200,000 criminal fine and to assist the department in its ongoing investigation into the aftermarket auto lights industry.
According to the charge, Sabry Lee and co-conspirators participated in a conspiracy in which the participants met and agreed to charge prices of aftermarket auto lights at certain predetermined levels. According to the court documents, the participants in the conspiracy issued price announcements and price lists in accordance with the agreements reached, and collected and exchanged information on prices and sales of aftermarket auto lights for the purpose of monitoring and enforcing adherence to the agreed-upon prices. The department said that the conspirators met in Taiwan, the United States and elsewhere for their discussions.
Sabry Lee is the first corporation to be charged in connection with the department’s ongoing investigation into the aftermarket auto lights industry. Three individuals have also been charged. Polo Shu-Sheng Hsu, the former president and chief executive officer of a U.S. distributor of aftermarket auto lights, entered his guilty plea on March 29, 2011, and was sentenced to serve 180 days in prison and to pay a $25,000 criminal fine. Chien Chung Chen, aka Andrew Chen, the former executive vice president of Sabry Lee, pleaded guilty to his participation in the conspiracy on June 7, 2011. He is currently scheduled to be sentenced on Dec. 13, 2011. Homy Hong-Ming Hsu was arrested at Los Angeles International Airport on July 12, 2011, and indicted on July 19, 2011. Homy Hong-Ming Hsu is the vice chairman and second highest-ranking officer of a Taiwan manufacturer of aftermarket auto lights.
Sabry Lee is charged with violating the Sherman Act, which carries a maximum penalty of a $100 million criminal fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims, if either of those amounts is greater than the statutory maximum fine.”
Fines and prison times for the executives and fines for the company. It seems that other companies and executives may meet the same fate since the investigation is ongoing.
Wednesday, August 31, 2011
DOJ LAUNCHES LAWSUIT TO STOP AT@T’S PURCHASE OF T-MOBILE
The following is an excerpt from the Department of Justice website:
“WASHINGTON — The Department of Justice today filed a civil antitrust lawsuit to block AT&T Inc.’s proposed acquisition of T-Mobile USA Inc. The department said that the proposed $39 billion transaction would substantially lessen competition for mobile wireless telecommunications services across the United States, resulting in higher prices, poorer quality services, fewer choices and fewer innovative products for the millions of American consumers who rely on mobile wireless services in their everyday lives.
The department’s lawsuit, filed in U.S. District Court for the District of Columbia, seeks to prevent AT&T from acquiring T-Mobile from Deutsche Telekom AG.
“The combination of AT&T and T-Mobile would result in tens of millions of consumers all across the United States facing higher prices, fewer choices and lower quality products for mobile wireless services,” said Deputy Attorney General James M. Cole. “Consumers across the country, including those in rural areas and those with lower incomes, benefit from competition among the nation’s wireless carriers, particularly the four remaining national carriers. This lawsuit seeks to ensure that everyone can continue to receive the benefits of that competition.”
“T-Mobile has been an important source of competition among the national carriers, including through innovation and quality enhancements such as the roll-out of the first nationwide high-speed data network,” said Sharis A. Pozen, Acting Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “Unless this merger is blocked, competition and innovation will be reduced, and consumers will suffer.”
Mobile wireless telecommunications services play a critical role in the way Americans live and work, with more than 300 million feature phones, smart phones, data cards, tablets and other mobile wireless devices in service today. Four nationwide providers of these services – AT&T, T-Mobile, Sprint and Verizon – account for more than 90 percent of mobile wireless connections. The proposed acquisition would combine two of those four, eliminating from the market T-Mobile, a firm that historically has been a value provider, offering particularly aggressive pricing.
According to the complaint, AT&T and T-Mobile compete head to head nationwide, including in 97 of the nation’s largest 100 cellular marketing areas. They also compete nationwide to attract business and government customers. AT&T’s acquisition of T-Mobile would eliminate a company that has been a disruptive force through low pricing and innovation by competing aggressively in the mobile wireless telecommunications services marketplace.
The complaint cites a T-Mobile document in which T-Mobile explains that it has been responsible for a number of significant “firsts” in the U.S. mobile wireless industry, including the first handset using the Android operating system, Blackberry wireless email, the Sidekick, national Wi-Fi “hotspot” access, and a variety of unlimited service plans. T-Mobile was also the first company to roll out a nationwide high-speed data network based on advanced HSPA+ (High-Speed Packet Access) technology. The complaint states that by January 2011, an AT&T employee was observing that “[T-Mobile] was first to have HSPA+ devices in their portfolio…we added them in reaction to potential loss of speed claims.”
The complaint details other ways that AT&T felt competitive pressure from T-Mobile. The complaint quotes T-Mobile documents describing the company’s important role in the market:
T-Mobile sees itself as “the No. 1 value challenger of the established big guys in the market and as well positioned in a consolidated 4-player national market”; and
T-Mobile’s strategy is to “attack incumbents and find innovative ways to overcome scale disadvantages. [T-Mobile] will be faster, more agile, and scrappy, with diligence on decisions and costs both big and small. Our approach to market will not be conventional, and we will push to the boundaries where possible. . . . [T-Mobile] will champion the customer and break down industry barriers with innovations. . . .”
The department said that it gave serious consideration to the efficiencies that the merging parties claim would result from the transaction. The department concluded AT&T had not demonstrated that the proposed transaction promised any efficiencies that would be sufficient to outweigh the transaction’s substantial adverse impact on competition and consumers. Moreover, the department said that AT&T could obtain substantially the same network enhancements that it claims will come from the transaction if it simply invested in its own network without eliminating a close competitor.
AT&T is a Delaware corporation headquartered in Dallas. AT&T is one of the world’s largest providers of communications services, and is the second largest mobile wireless telecommunications services provider in the United States as measured by subscribers. It serves approximately 98.6 million connections to wireless devices. In 2010, AT&T earned mobile wireless telecommunications services revenues of $53.5 billion, and its total revenues were in excess of $124 billion.
T-Mobile, is a Delaware corporation headquartered in Bellevue, Wash. T-Mobile is the fourth-largest mobile wireless telecommunications services provider in the United States as measured by subscribers, and serves approximately 33.6 million wireless connections to wireless devices. In 2010, T-Mobile earned mobile wireless telecommunications services revenues of $18.7 billion. T-Mobile is a wholly-owned subsidiary of Deutsche Telekom AG.
Deutsche Telekom AG is a German corporation headquartered in Bonn, Germany. It is the largest telecommunications operator in Europe with wireline and wireless interests in numerous countries and total annual revenues in 2010 of €62.4 billion. “
“WASHINGTON — The Department of Justice today filed a civil antitrust lawsuit to block AT&T Inc.’s proposed acquisition of T-Mobile USA Inc. The department said that the proposed $39 billion transaction would substantially lessen competition for mobile wireless telecommunications services across the United States, resulting in higher prices, poorer quality services, fewer choices and fewer innovative products for the millions of American consumers who rely on mobile wireless services in their everyday lives.
The department’s lawsuit, filed in U.S. District Court for the District of Columbia, seeks to prevent AT&T from acquiring T-Mobile from Deutsche Telekom AG.
“The combination of AT&T and T-Mobile would result in tens of millions of consumers all across the United States facing higher prices, fewer choices and lower quality products for mobile wireless services,” said Deputy Attorney General James M. Cole. “Consumers across the country, including those in rural areas and those with lower incomes, benefit from competition among the nation’s wireless carriers, particularly the four remaining national carriers. This lawsuit seeks to ensure that everyone can continue to receive the benefits of that competition.”
“T-Mobile has been an important source of competition among the national carriers, including through innovation and quality enhancements such as the roll-out of the first nationwide high-speed data network,” said Sharis A. Pozen, Acting Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “Unless this merger is blocked, competition and innovation will be reduced, and consumers will suffer.”
Mobile wireless telecommunications services play a critical role in the way Americans live and work, with more than 300 million feature phones, smart phones, data cards, tablets and other mobile wireless devices in service today. Four nationwide providers of these services – AT&T, T-Mobile, Sprint and Verizon – account for more than 90 percent of mobile wireless connections. The proposed acquisition would combine two of those four, eliminating from the market T-Mobile, a firm that historically has been a value provider, offering particularly aggressive pricing.
According to the complaint, AT&T and T-Mobile compete head to head nationwide, including in 97 of the nation’s largest 100 cellular marketing areas. They also compete nationwide to attract business and government customers. AT&T’s acquisition of T-Mobile would eliminate a company that has been a disruptive force through low pricing and innovation by competing aggressively in the mobile wireless telecommunications services marketplace.
The complaint cites a T-Mobile document in which T-Mobile explains that it has been responsible for a number of significant “firsts” in the U.S. mobile wireless industry, including the first handset using the Android operating system, Blackberry wireless email, the Sidekick, national Wi-Fi “hotspot” access, and a variety of unlimited service plans. T-Mobile was also the first company to roll out a nationwide high-speed data network based on advanced HSPA+ (High-Speed Packet Access) technology. The complaint states that by January 2011, an AT&T employee was observing that “[T-Mobile] was first to have HSPA+ devices in their portfolio…we added them in reaction to potential loss of speed claims.”
The complaint details other ways that AT&T felt competitive pressure from T-Mobile. The complaint quotes T-Mobile documents describing the company’s important role in the market:
T-Mobile’s strategy is to “attack incumbents and find innovative ways to overcome scale disadvantages. [T-Mobile] will be faster, more agile, and scrappy, with diligence on decisions and costs both big and small. Our approach to market will not be conventional, and we will push to the boundaries where possible. . . . [T-Mobile] will champion the customer and break down industry barriers with innovations. . . .”
The department said that it gave serious consideration to the efficiencies that the merging parties claim would result from the transaction. The department concluded AT&T had not demonstrated that the proposed transaction promised any efficiencies that would be sufficient to outweigh the transaction’s substantial adverse impact on competition and consumers. Moreover, the department said that AT&T could obtain substantially the same network enhancements that it claims will come from the transaction if it simply invested in its own network without eliminating a close competitor.
AT&T is a Delaware corporation headquartered in Dallas. AT&T is one of the world’s largest providers of communications services, and is the second largest mobile wireless telecommunications services provider in the United States as measured by subscribers. It serves approximately 98.6 million connections to wireless devices. In 2010, AT&T earned mobile wireless telecommunications services revenues of $53.5 billion, and its total revenues were in excess of $124 billion.
T-Mobile, is a Delaware corporation headquartered in Bellevue, Wash. T-Mobile is the fourth-largest mobile wireless telecommunications services provider in the United States as measured by subscribers, and serves approximately 33.6 million wireless connections to wireless devices. In 2010, T-Mobile earned mobile wireless telecommunications services revenues of $18.7 billion. T-Mobile is a wholly-owned subsidiary of Deutsche Telekom AG.
Deutsche Telekom AG is a German corporation headquartered in Bonn, Germany. It is the largest telecommunications operator in Europe with wireline and wireless interests in numerous countries and total annual revenues in 2010 of €62.4 billion. “
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