SEC: Purported Green Technology Company Defrauding Investors
The Securities and Exchange Commission today charged a California-based company and two executives with using baseless financial projections and other misleading statements to defraud investors in a venture to manufacture environmentally-friendly building materials. The SEC alleges that Enviro Board Corporation and its co-chairmen/CEOs Glenn Camp and William Peiffer raised approximately $6 million from investors during a four-year period by using documents predicting company earnings ranging from $18 million to $95 million per year. They allegedly lacked any reasonable basis for such estimates amid persistent manufacturing problems plaguing the company since its inception. Enviro Board claimed its green materials had already…
Read MoreSEC Seeks Public Comment on Disclosure Requirements Relating to Management, Security Holders and Corporate Governance Matters
The Securities and Exchange Commission today announced that it is seeking public comment on disclosure requirements in Subpart 400 of Regulation S-K, including those relating to management, certain security holders, and corporate governance matters. The request for comment is part of the Disclosure Effectiveness Initiative, which is a broad-based staff review of the disclosure requirements and the presentation and delivery of the disclosures. The request for comment also will inform the Commission’s study on Regulation S-K, which is required by the Fixing America’s Surface Transportation (FAST) Act. The public comment period will remain open for 60 days following publication of the comment…
Read MoreSEC Adopts Rules to Enhance Information Reported by Investment Advisers
The Securities and Exchange Commission today adopted amendments to several Investment Advisers Act rules and the investment adviser registration and reporting form to enhance the reporting and disclosure of information by investment advisers. The amendments will improve the quality of information that investment advisers provide to investors and the Commission. “These amendments are an important step in a series of rulemakings to enhance the SEC’s monitoring and regulation of the asset management industry,” said SEC Chair Mary Jo White. “Requiring investment advisers to report this additional information will provide investors and the Commission with a better understanding of the risk…
Read MoreInvestment Advisers Paying Penalties for Advertising False Performance Claims
The Securities and Exchange Commission today announced penalties against 13 investment advisory firms found to have violated securities laws by spreading the false claims made by an investment management firm about its flagship product. An SEC enforcement sweep of investment advisers found that the 13 firms accepted and negligently relied upon claims by F-Squared Investments that its AlphaSector strategy for investing in exchange-traded funds (ETFs) had outperformed the S&P Index for several years. The firms repeated many of F-Squared’s claims while recommending the investment to their own clients without obtaining sufficient documentation to substantiate the information being advertised. F-Squared later…
Read MoreSEC Charges 71 Municipal Issuers in Muni Bond Disclosure Initiative
The Securities and Exchange Commission today announced enforcement actions against 71 municipal issuers and other obligated persons for violations in municipal bond offerings. The actions were brought under the Municipalities Continuing Disclosure Cooperation (MCDC) Initiative, a voluntary self-reporting program targeting material misstatements and omissions in municipal bond offering documents. The initiative offered favorable settlement terms to municipal bond underwriters, issuers, and obligated persons that self-reported certain violations of the federal securities laws. Obligated persons are typically nonprofit entities such as hospitals and colleges that borrow the proceeds of bond issuances and are obligated to pay principal and interest on the…
Read More