Former Oppenheimer Employees Settle Charges Involving Unregistered Sales of Penny Stocks

The Securities and Exchange Commission today announced that three former employees of Oppenheimer & Co. Inc. have agreed to settle charges stemming from the unregistered sales of billions of shares of penny stocks on behalf of a customer.  The actions involve a portion of the conduct announced in January in a settled enforcement action against Oppenheimer in which the broker-dealer admitted wrongdoing and paid $20 million to the SEC and the Treasury Department’s Financial Crimes Enforcement Network.

Today’s actions were instituted against Scott A. Eisler, a former registered representative at Oppenheimer’s branch in Boca Raton, Fla., his former branch manager and supervisor Arthur W. Lewis, and Le... Read More

SEC Charges Three Penny Stock Promoters Behind Pump-and-Dump Schemes

The Securities and Exchange Commission today charged a trio of alleged microcap stock scammers with defrauding investors by disseminating promotional e-mails exhorting readers to immediately buy purportedly hot stocks so they could secretly sell their own holdings at a substantial profit.

The SEC alleges that the three men, who live in Israel, obtained shares in several penny stock companies and pumped the prices as high as 1,800 percent before dumping the shares for at least $2.8 million in illicit proceeds.  In one extravagantly positive promotional e-mail about a particular stock, they stated that a $5,000 investment could be worth more than $250,000 in two years.  The men used numerous corporate identities and developed at least 20 different stock promotion we... Read More

Michele Anderson Named Associate Director in the Division of Corporation Finance

The Securities and Exchange Commission announced today the promotion of Michele Anderson to the position of Associate Director in the agency's Division of Corporation Finance.  She begins her new role later this month.

Ms. Anderson has served as Chief of the division’s Office of Mergers and Acquisitions since 2008.  She began her career at the SEC in 1998 as an attorney-advisor in the division and from 2004 to 2008, she was Legal Branch Chief in the division’s Office of Telecommunications. 

In her new role as Associate Director, Ms. Anderson will oversee the work of the division’s Office of Mergers and Acquisitions and its Office of International Corporate Finance.  She also will be responsible for overseeing rulemaking initiatives and no-action, interpre... Read More

SEC Pays More Than $3 Million to Whistleblower

The Securities and Exchange Commission today announced a whistleblower award of more than $3 million to a company insider whose information helped the SEC crack a complex fraud.  The multi-million dollar payout is the third highest award to date under the SEC’s whistleblower program.

The whistleblower’s specific and detailed information comprehensively laid out the fraudulent scheme which otherwise would have been very difficult for investigators to detect. The whistleblower’s initial tip also led to related actions that increased the whistleblower’s award.

“Insiders may hold the key to helping our investigators unlock intricate fraudulent schemes,” said Andrew Ceresney, Director of the SEC’s Division of Enforcement.  “By providing significant financial i... Read More

SEC Charges Pennsylvania Attorney with Insider Trading in Advance of Merger Announcement

The Securities and Exchange Commission today charged a Pennsylvania attorney with insider trading in the stock of Harleysville Group, Inc. in advance of the 2011 announcement of a $760 million merger of Harleysville and Nationwide Mutual Insurance Company.

According to the SEC’s complaint, Herbert K. Sudfeld illegally traded on the news that sent Harleysville’s stock price up 87 percent when the merger of the two insurance companies was announced in September 2011.  At the time, Sudfeld was a real estate partner at a law firm that advised Harleysville on the merger.  Sudfeld was not involved in the merger and learned that the announcement of it was imminent from a conversation between an attorney working on the transaction and their shared legal assistant.  Sudfeld alleged... Read More

SEC Charges Purported Investment Adviser in San Diego With Stealing Client Funds and Conducting a Ponzi Scheme

The Securities and Exchange Commission today charged a purported investment adviser in San Diego with stealing money from clients for personal use and conducting a Ponzi scheme to pay customers making redemption requests.

In a complaint filed in federal court in San Diego, the SEC alleges that Paul Lee Moore and Coast Capital Management, his purported investment advisory firm, raised $2.6 million from clients.  Instead of investing their money as promised, Moore allegedly siphoned nearly $2 million of client funds to pay travel expenses, buy retail goods, and fund his use of pornographic websites.  The complaint alleges that Moore used the remaining $625,000 in client funds to repay earlier clients with money from new clients in classic Ponzi scheme fashion.  Moore alleged... Read More

SEC Chair White, Federal Agencies Join Forces for Military Consumer Protection Day 2015

Securities and Exchange Commission Chair Mary Jo White led a multi-agency event today to support Military Consumer Protection Day 2015, highlighting how service members can best protect themselves and their finances from fraud and identity theft.

Chair White was joined at the Joint Base McGuire-Dix-Lakehurst event by officials from the U.S. Postal Inspection Service, the Department of Justice’s Service Members and Veterans Initiative, the U.S. Attorneys' Housing and Civil Enforcement Section of the Fair Housing Program, the FBI’s Securities Fraud Program and the U.S. Secret Service.

“Taking control of your finances starts with access to information about financial products and services and the people who sell them,” said SEC Chair Mary Jo White. “We want ... Read More

SEC Charges 34 Defendants in Microcap Market Manipulation Schemes

The Securities and Exchange Commission today charged 15 individuals and 19 entities for their roles in alleged schemes to manipulate the trading of microcap stocks.  The 34 defendants include six firms alleged to have acted as unregistered broker-dealers catering to customers who sought to conceal their stock ownership and manipulate the market for microcap securities. 

Owners and employees at the six firms, several customers, stock promoters, and two microcap issuers – Warrior Girl Corp. and Nature’s Peak, formerly Everock, Inc.  –  also are among the defendants in the case filed in federal district court in Manhattan.  The SEC charged the defendants with fraud, manipulative trading, touting, and with registration violations.  Nine of the defendants were named in a crimin... Read More

OZ Management LP Admits Providing Inaccurate Data, Impacting Brokers’ Records and “Blue Sheets”

The Securities and Exchange Commission today charged OZ Management LP with providing inaccurate trade data to four prime brokers, causing inaccuracies in the brokers’ books and records and in data provided to the SEC in investigations.  OZ Management, an investment adviser for numerous Och-Ziff funds, admitted wrongdoing and agreed to pay a $4.25 million penalty to settle the charges.

According to the SEC’s order instituting a settled cease-and-desist proceeding, for nearly six years, ending in December 2013, OZ Management misidentified some trades in data provided to four of its prime brokers.  Although trade settlement was unaffected, the erroneous data had a significant impact, causing the four prime brokers to inaccurately list approximately 552 million shares in their... Read More

Release of Joint Staff Report on October 15, 2014

Staff from the U.S. Department of Treasury, the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York, the U.S. Securities and Exchange Commission, and the U.S. Commodity Futures Trading Commission today issued a joint report analyzing the significant volatility in the U.S. Treasury market on October 15, 2014.  Using non-public data from the U.S. Treasury cash and futures markets, the joint report provides detailed analysis of the market conditions and record trading volumes that day, including an unusually rapid round trip in prices and deterioration in liquidity during a narrow window. 

The joint report makes clear that a number of developments help explain the conditions that likely contributed to the volatility.  Specifically, the repor... Read More

SEC Announces Settlement With Cooperator in Grand Central Post-It Notes Insider Trading Case

The Securities and Exchange Commission today announced a settlement with a Brooklyn man who entered into a cooperation agreement to help the agency mount evidence in an insider trading scheme in which illegal tips were passed via napkins or post-it notes at Grand Central Terminal.

The SEC last year charged a law firm clerk and a stockbroker with insider trading in a scheme that used a mutual friend to pass material, nonpublic information from the law firm’s computer systems about clients’ pending corporate transactions.  The SEC identified that middleman as Frank Tamayo in a subsequent complaint filed in feder... Read More

SEC Advisory Committee on Small and Emerging Companies to Hold Conference Call Meeting

The Securities and Exchange Commission today announced that its Advisory Committee on Small and Emerging Companies will hold a public meeting by telephone conference on July 15.

The advisory committee plans to continue its discussions regarding public company disclosure effectiveness and the regulatory treatment of so-called “finders” that assist companies in capital raising activities.  These topics were initially discussed at the committee’s June 3 meeting.

The July 15 meeting will begin at 1:00 p.m. ET and live audio will be available on the SEC’s website.

The Advisory Committee on Small and Emerging Companies provides a formal mechanism for the Commissio... Read More