SEC Announces Charges Against N.Y.-Based Firm and Three Executives Accused of Siphoning Investor Money
The Securities and Exchange Commission today announced charges against three fund managers and their New York-based firm accused of secretly diverting investor money for their own benefit to prop up a fledgling side business. The SEC Enforcement Division alleges that VERO Capital Management’s president Robert Geiger, general counsel George Barbaresi, and chief financial officer Steven Downey managed a pair of funds whose offering documents indicated they would aim to achieve attractive returns by investing primarily in mortgage-backed securities. After deciding to wind down the funds, instead of returning all of the cash to investors as the funds liquidated their investments,…
Read MoreSEC Issues Annual Staff Reports on Credit Rating Agencies
The Securities and Exchange Commission today issued its annual staff report on the findings of examinations of credit rating agencies registered as nationally recognized statistical rating organizations (NRSROs) and submitted a separate report on NRSROs to Congress. “These reports provide the most current and comprehensive picture of the credit rating industry,” said SEC Chair Mary Jo White. “The SEC’s enhanced oversight of NRSROs, informed by risk assessment, regular examinations and policy considerations, provides increasingly robust and effective oversight of the industry, as reflected by overall improvements in compliance, documentation, and board oversight.” The 2010 Dodd-Frank Act requires the SEC to…
Read MoreSEC Charges California-Based Stock Promoter With Defrauding Investors Seeking Pre-IPO Facebook and Twitter Shares
The Securities and Exchange Commission today charged a stock promoter based in Santa Barbara, Calif., with fraudulently raising nearly $3.5 million from investors purportedly to purchase Facebook and Twitter shares prior to their initial public offerings (IPOs). The SEC alleges that instead of purchasing the shares in the secondary market as promised, Efstratios “Elias” Argyropoulos and his firm Prima Capital Group misappropriated investor funds. They used the money primarily for day trading of stocks and options as well as to pay off certain investors who complained when they didn’t receive the promised Facebook or Twitter shares. Argyropoulos agreed to settle…
Read MoreSEC Charges Two Traders in Chile With Insider Trading
The Securities and Exchange Commission today charged two business associates in Chile with insider trading on nonpublic information that one of them learned while serving on the board of directors of a pharmaceutical company. The agency obtained a court order to freeze assets in the U.S. brokerage accounts used to conduct the trading. The SEC alleges that Juan Cruz Bilbao Hormaeche exploited highly confidential information from CFR Pharmaceuticals S.A. board meetings at which a tender offer by Abbott Laboratories was discussed. In a U.S. brokerage account of which he is the beneficiary, Bilbao caused the purchase of millions of dollars’…
Read MoreSEC Charges Corporate Attorney and Wife With Insider Trading on Client’s Confidential Information
The Securities and Exchange Commission today charged a California-based attorney and his wife with insider trading on confidential information obtained from a corporate client. The SEC alleges that while serving as outside counsel to Spectrum Pharmaceuticals last year, Shivbir Grewal learned that the company was on the brink of announcing a significant decline in expected revenue due to an unanticipated drop in orders for its top-selling drug. Grewal sold his entire investment in Spectrum stock within 48 hours of getting the nonpublic information from company officials who sought the disclosure advice of his law firm. He tipped his wife Preetinder…
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