LexisNexis® Legal Newsroom
Another Offering Fraud Case

Cases involving the sale of unregistered securities and Ponzi schemes were among the leading categories of cases brought last year according to recent statistics from NERA Economic Consulting ( here ). The Commission's action against Kenneth Dachman combined elements of both. SEC v. Dachman, Case...

SEC, USAO, FINRA Bring Charges For Sale of Unregistered Penny Stocks

The sale of unregistered penny stock shares spawned three recent securities enforcement actions. First, the SEC and the U.S. Attorney’s Office for the Southern District of California filed actions centered on an off-shore boiler room coordinated from Florida. The SEC’s action named John Rizzo...

Circuit Court Rejects SEC Position on Section 5 Liability

The Ninth Circuit rejected the SEC’s contention that a stock transfer agent and its principal are necessarily liable “by virtue of their position” for a company whose unregistered shares were sold in violation of Securities Act Section 5. SEC v. CMKM Diamonds, Inc., Nos. 11-17021, 11...

SEC Names Recidivist, Claimed Country Music Fund Raiser, In Fraud Order

The Commission directed the institution of an administrative proceeding charging recidivist Stanley Jonathan Fortenberry, an unregistered fund adviser, with fraud in connection with the operation of a fund supposedly tied to a country music talent. In the Matter of Stanley Jonathan Fortenberry, Adm....

SEC, Bitcoin and Unregistered Offerings

Bitcoin has been a much discussed item recently. The virtual currency is a digital representation of value that is traded and can serve as a medium of exchange. There are websites that use it. At one time there was a stock exchange called the Global Bitcoin Stock Exchange which apparently listed shares...

SEC Charges E*Trade Subs: When Is the Due Diligence Sufficient?

Having the correct compliance procedures in place can often be critical. The SEC and the DOJ have repeatedly emphasized this in FCPA cases. Conducting due diligence can be equally critical. For gatekeepers such as lawyers, accountants and brokers, conducting appropriate due diligence can mean the difference...

Crowd-Funding Site Named in SEC Proceeding

Raising capital through crowd-funding is one of the key provisions of the JOBS Act. It is supposed to facilitate raising small amounts of capital for start-up operations. An off-shore crowd-funding site that sold unregistered securities to U.S. citizens, however, ran afoul of the registration provisions...

Oppenheimer Settles with SEC, FinCEN

Oppenheimer & Co., Inc. settled an action with the SEC centered on violations of the broker registration provisions, a failure to file suspicious activity reports or SARS and the sale of unregistered penny stock shares. The settlement is based in part on admissions that the firm violated the Federal...

SEC Settles Unregistered Broker Charges Tied to Offering Fraud

The SEC entered into partial settlements with three persons charged with acting as brokers without registering. The charges were tied to an offering fraud which centered on selling interests in a firm that claimed to be engaged in the business of buying and selling fractional interests in oil and gas...

SEC, FINRA, DC Sanction Success Trade

A recurrent theme in today’s enforcement environment is parallel and often overlapping proceedings. That is the case with a District of Columbia based broker that drew sanctions from the SEC, FINRA and DC. In the Matter of Success Trade, Inc., Adm. Proc. File No. 3-16755 (August 14, 2015). Respondent...