Securities

Recent Posts

SEC Obtains $62.6 Million Judgment Against Former CEO
Posted on 11 Oct 2011 by Thomas O. Gorman

The SEC obtained a $62,630,434.56 judgment against Tomo Razmilovic, the former CEO of Symbol Technologies, Inc. in its long running financial fraud action arising out of the fraud at the company. SEC v. Razmilovic, Case No. CV 04-2276 (E.D.N.Y.). The... Read More

SEC Files Settled Fraud Action Against Assistant to Adviser
Posted on 13 Feb 2014 by Thomas O. Gorman

An assistant to an unregistered investment adviser settled fraud charges based on billings tied to false profits. The charges stem from efforts by the adviser to conceal trading losses from firm clients. In the Matter of Ronald E. Huxtable II, Adm. Proc... Read More

SEC Files Financial Fraud Action
Posted on 25 Aug 2014 by Thomas O. Gorman

Financial fraud is an enforcement priority of the SEC. A financial fraud task force was formed in July 2013. Its purpose is to focus on this traditional staple of enforcement. A data analysis group was formed at the same time to give the task force a... Read More

SEC Files Financial Fraud Actions, Mired in Controversy
Posted on 8 Jun 2015 by Thomas O. Gorman

In the wake of the market crisis and the formation of a task force, the SEC has sought to focus in part on financial fraud actions. The action filed at the close of last week against Computer Sciences Corporation and seven of its executives may be one... Read More

Parallel Financial Fraud Actions
Posted on 15 Dec 2010 by Thomas O. Gorman

The Manhattan U.S. Attorney's Office and the SEC continue to bring cases in tandem. This time however, it is not insider trading, but financial fraud involving Vitesse Semiconductor Corporation, a California based integrated circuit maker and four... Read More

SEC Charges Advisory Firm to Sports Figures and Officers With Fraud
Posted on 18 Jun 2015 by Thomas O. Gorman

The SEC filed two actions centered on an advisory firm that serves on high net worth individuals, primarily current and former professional athletes. The actions are based on the theft of client funds and a failure to supervise by the firm. In the Matter... Read More

SEC Inspection Staff Uncovers a Possible Fraud
Posted on 12 Jan 2015 by Thomas O. Gorman

The SEC claims that an individual that controlled several entities including an investment fund created phony consumer loans to funnel investor cash to his faltering financial operations rather than investing the money in actual loans in accord with the... Read More

Riding a Tiger: A Billion Dollar Financial Fraud Case
Posted on 6 Apr 2011 by Thomas O. Gorman

A billion dollar financial fraud, an admission by the former chairman and the seizure of the company by the government followed by criminal charges against the senior officers and auditors forms the backdrop of the SEC's latest financial fraud... Read More

Commission Brings Four Actions Based on Financial Fraud
Posted on 31 Jan 2012 by Thomas O. Gorman

The Commission brought four actions centered on a years long financial fraud at Sheffield, England based Symmetry Medical Sheffield LTD f/k/a Thorton Precision Components, Ltd or TPC. The company is the English subsidiary of Symmetry Medical, Inc.... Read More

Principals of Investment Adviser Charged in SEC Action
Posted on 21 Nov 2013 by Thomas O. Gorman

Two principals of an investment adviser were named as Respondents in an SEC administrative proceeding. The action centers on claims that the two men improperly advised their clients to invest in off-shore funds without fully disclosing their affiliation... Read More

SEC Files Another Fraud Action Tied to the Municipal Bond Market
Posted on 16 Sep 2013 by Thomas O. Gorman

The SEC filed another settled financial fraud action tied to the municipal bond market which is clearly an area of increasing focus. This proceeding named as a Respondent the operator of the largest public health system in Miami-Dade County Florida. In... Read More

SEC Charges Advisory Firm to Sports Figures and Officers With Fraud
Posted on 18 Jun 2015 by Doug Esten

The SEC filed two actions centered on an advisory firm that serves on high net worth individuals, primarily current and former professional athletes. The actions are based on the theft of client funds and a failure to supervise by the firm. In the Matter... Read More

A Financial Fraud Action Centered on a Fictitious Customer
Posted on 12 Nov 2010 by Thomas O. Gorman

The SEC filed an amended complaint, adding Jon Latorella and James Fields as defendants to an action alleging a financial fraud and stock manipulation involving two companies they control. SEC v. LocatePlus Holdings Company , Case No. 1:10-cv-11751... Read More

SEC Files Settled Financial Fraud Action
Posted on 24 Sep 2015 by Thomas O. Gorman

Financial fraud actions have traditionally been a staple of SEC Enforcement. During the market crisis, however, the number of those cases waned. Following the formation of a task force focused on financial statement fraud, and a related data group, many... Read More

SEC Settles Another Market Crisis Financial Fraud Action
Posted on 18 May 2015 by Thomas O. Gorman

The Commission resolved another financial fraud action stemming from the aftermath of the market crisis. This proceeding, initially brought in June 2014, named as a Respondent Thomas Neely, Jr., and E.V. P. of Regions Bank. In the Matter of Thomas A.... Read More

  • Blog Post: A Financial Fraud Action Centered on a Fictitious Customer

    The SEC filed an amended complaint, adding Jon Latorella and James Fields as defendants to an action alleging a financial fraud and stock manipulation involving two companies they control. SEC v. LocatePlus Holdings Company , Case No. 1:10-cv-11751 (D. Mass. Nov. 11, 2010) ( previously discussed ...
  • Blog Post: Parallel Financial Fraud Actions

    The Manhattan U.S. Attorney's Office and the SEC continue to bring cases in tandem. This time however, it is not insider trading, but financial fraud involving Vitesse Semiconductor Corporation, a California based integrated circuit maker and four of its former executives. U.S. v. Tomasetta , Case...
  • Blog Post: Outside Directors Named in SEC Financial Fraud Case

    SEC v. DBH Industries, Inc. , Civil Action No. 0:11-cv-60431 (S.D. Fla. Filed Feb. 28, 2011) and SEC v. Krantz , Civil Action No. 0:11-cv-60432 (S.D. Fla. Filed Feb. 28, 2011) are two fraud actions arising from the demise of military bullet proof vest manufacturer DBH Industries, otherwise known...
  • Blog Post: Riding a Tiger: A Billion Dollar Financial Fraud Case

    A billion dollar financial fraud, an admission by the former chairman and the seizure of the company by the government followed by criminal charges against the senior officers and auditors forms the backdrop of the SEC's latest financial fraud case. Satyam Computer Services Ltd. of India conducted...
  • Blog Post: This Week in Securities Litigation (April 8, 2011)

    Prosecutors concluded their case-in-chief in the Galleon insider trading trial this week. SEC enforcement, in conjunction with the U.S. Attorney's Office in New Jersey, brought an insider trading case against an attorney, a former associate of three prominent law firms, and a professional trader...
  • Blog Post: This Week in Securities Litigation (May 13, 2011)

    The war on insider trading by the Manhattan U.S. Attorney was propelled forward this week with the conviction of Galleon hedge fund founder Raj Rajaratnam on all fourteen counts. At the same time another defendant in the expert network investigation pleaded guilty. DOJ also prevailed in an FCPA jury...
  • Blog Post: Financial Fraud Case Ends with DOJ Deferred Prosecution

    The DOJ resolved a financial fraud action involving O'Reilly Automotive Inc. and CSK Auto Corporation by entering into a deferred prosecution agreement. Under the terms of the agreement CSK Auto took responsibility for the conduct of its employees who perpetrated a large financial fraud which...
  • Blog Post: SEC Obtains $62.6 Million Judgment Against Former CEO

    The SEC obtained a $62,630,434.56 judgment against Tomo Razmilovic, the former CEO of Symbol Technologies, Inc. in its long running financial fraud action arising out of the fraud at the company. SEC v. Razmilovic, Case No. CV 04-2276 (E.D.N.Y.). The amount is one of the largest obtained by the Commission...
  • Blog Post: Commission Brings Four Actions Based on Financial Fraud

    The Commission brought four actions centered on a years long financial fraud at Sheffield, England based Symmetry Medical Sheffield LTD f/k/a Thorton Precision Components, Ltd or TPC. The company is the English subsidiary of Symmetry Medical, Inc., a U.S. manufacturer of prosthetics, medical implants...
  • Blog Post: The SEC Should Make Financial Fraud an Enforcement Priority Now

    At the Financial Reporting Institute Conference last week SEC Commissioner Walter and Chief Accountant Paul Beswick addressed the necessity for high quality financial reporting, the application of international accounting standards or IFRS and the work of the Public Company Accounting Oversight Board...
  • Blog Post: SEC Files Another Fraud Action Tied to the Municipal Bond Market

    The SEC filed another settled financial fraud action tied to the municipal bond market which is clearly an area of increasing focus. This proceeding named as a Respondent the operator of the largest public health system in Miami-Dade County Florida. In the Matter of Public Health Trust of Miami-Dade...
  • Blog Post: Principals of Investment Adviser Charged in SEC Action

    Two principals of an investment adviser were named as Respondents in an SEC administrative proceeding. The action centers on claims that the two men improperly advised their clients to invest in off-shore funds without fully disclosing their affiliation with those funds or the fees they were paid. In...
  • Blog Post: SEC Settles Financial Fraud Case

    Two senior executives at Veolia Environmental Services Special Services, a U.S. subsidiary of Paris based multi-national Veolia Environment S.A., were named in and resolved a financial fraud case with the SEC. SEC v. Hohol, 2:14-CV-00041 (E.D. Wis. Filed January 14, 2014). See Lit. Rel. No. 22906 (January...
  • Blog Post: Jury Finds Against SEC on Most Claims in Financial Fraud Case

    The jury in SEC v. Life Partners Holdings, Inc., Civil Action No. 1-12-cv-00033 (W.D. Tx. Verdict Feb. 3, 2014) rejected most of the Commission’s claims which centered around an alleged financial fraud. This is one of a series of recent set-backs the SEC has suffered in the courtroom. The action...
  • Blog Post: SEC Files Settled Fraud Action Against Assistant to Adviser

    An assistant to an unregistered investment adviser settled fraud charges based on billings tied to false profits. The charges stem from efforts by the adviser to conceal trading losses from firm clients. In the Matter of Ronald E. Huxtable II, Adm. Proc. File NO. 3-15748 (Feb. 12, 2014). Ronald Huxable...
  • Blog Post: SEC Files Financial Fraud Action

    Financial fraud is an enforcement priority of the SEC. A financial fraud task force was formed in July 2013. Its purpose is to focus on this traditional staple of enforcement. A data analysis group was formed at the same time to give the task force a new big data type approach under which computers would...
  • Blog Post: CEO, CFO Charged In SEC Financial Fraud Action

    Since the formation of the financial task force, and its related data group, there has been speculation regarding the focus of the new program and the impact of big data techniques. One indication of how the program could unfold may be in the approach used in the financial fraud action against Lynn Blodget...
  • Blog Post: Government Seeks to Stay Discovery in TelexFree SEC Case Pending Criminal Resolution

    The U.S. Department of Justice ("DOJ") has sought to intervene in the civil enforcement action brought against TelexFree by the Securities and Exchange Commission on the basis that a stay of civil discovery is appropriate pending resolution of parallel criminal proceedings against certain former...
  • Blog Post: The SEC’s Carter’s, Inc. Investigation Yields Another Insider Trading Case

    Carter’s, Inc. is the investigation that just keeps on generating cases. The investigation has yielded seven SEC actions charging insider trading and financial fraud. Hedge fund manager Stephen Slawson became the eight person charged in the investigation. SEC v. Slawson, Civil Action No. 1:14-cv...
  • Blog Post: SEC Inspection Staff Uncovers a Possible Fraud

    The SEC claims that an individual that controlled several entities including an investment fund created phony consumer loans to funnel investor cash to his faltering financial operations rather than investing the money in actual loans in accord with the representations made to investors. The complaint...
  • Blog Post: SEC Settles Financial Fraud Action

    Financial fraud is an enforcement priority of the SEC. A financial fraud task force was formed in July 2013 to focus on this traditional staple of enforcement. A data analysis group was formed at the same time to give the task force a new big data type approach under which computers would aid with prospecting...
  • Blog Post: SEC Files SOX Claw-back Action

    The Commission filed a settled administrative proceeding against two former CEOs of Saba Software, Inc. under the Sarbanes-Oxley claw back provisions. The action is based on the fact that the company has announced it will be required to restate its financial statements but, to date it has not undertaken...
  • Blog Post: Accounting Cases – An SEC Priority, but the Cases Being Filed Are Class Actions

    Accounting and financial fraud cases are an SEC priority. The cases, however, are being brought by the private bar as class actions. The number of accounting class actions filed last year increased by 47% compared to the prior year despite the fact that the number of securities class actions filed was...
  • Blog Post: SEC Files Financial Fraud Action Against Japan Based Controller

    The Commission filed a financial fraud action against a former senior accounting officer and controller of Molex Japan Co., Ltd., the Japanese based subsidiary of publicly traded Molex Inc. The scheme, which took place in Japan but impacted the books and records of the U.S. parent, was discovered after...
  • Blog Post: SEC Settles Another Market Crisis Financial Fraud Action

    The Commission resolved another financial fraud action stemming from the aftermath of the market crisis. This proceeding, initially brought in June 2014, named as a Respondent Thomas Neely, Jr., and E.V. P. of Regions Bank. In the Matter of Thomas A. Neely, Jr., Adm. Proc. File No 3-15945 (June 25, 2014...