Securities Industry Commentator by Bill Singer Esq WEEK IN REVIEW
November 25, 2017
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In today's Securities Industry Commentator feed:
District Court Enters
Permanent Injunctions Shutting Down Two Groups of International Defendants
Responsible for Multi-Million Dollar Mail Fraud Schemes (DOJ Press Release) The Department of Justice obtained consent decrees in two civil
actions against 14 individuals and entities that had operated international
mail-fraud schemes that preyed on elderly victims and other vulnerable
consumers. The scam involved "direct mailers" requesting a
"processing fee," in order to claim a prize or some good fortune. READ
FULL TEXT CONSENT DECREES
DOL Whistleblower
Darrell Whitman Files Emergency Request With US Office Of Special Counsel (BrokeAndBroker.com Blog) In 2010,
attorney Darrell Whitman became a Regional Investigator for the San Francisco
Region Office of Whistleblower Protection Programs ("OWWP"), which
was part of the United States Department of Labor's ("DOL's")
Occupational Safety and Health Administration ("OSHA"). Beginning in
2011, Whitman and others in the San Francisco OWWP office complained that they
were being hamstrung and short-circuited in their efforts to protect
whistleblowers against perceived retaliation -- essentially being prevented
from doing the job that they were being paid to do. In May 2015, Whitman was
fired. How ironic that Whitman, an OWWP investigator charged with protecting
whistleblowers from retaliation, found himself the victim of alleged
retaliation by OWWP. In response to his termination, Whitman sued. Today's
BrokeAndBroker.com Blog updates Whitman's pending case.
http://www.rrbdlaw.com/3682/securities-industry-commentator/
In
today's Securities Industry Commentator feed:
Sayfullo Saipov
Charged With Terrorism and Murder in Aid of Racketeering in Connection With
Lower Manhattan Truck Attack (DOJ
Press Release). In connection with the alleged terror attack on October 31,
2017 in Manhattan that killed eight and injured 12, READ the FULL TEXT INDICTMENT
United States of America v. Sayfullo Habibullaevic Saipov, Defendant (United
States District Court for the Southern District of New York 17-CR-722)
United States of
America v. Behzad Mesri a/k/a "Skote Vahshat" Defendant (Indictment, United States District Court
for the Southern District of New York, 17-CR-689) The Department of Justice alleged
in a seven-count Indictment that
Iranian national Behzad Mesri was a member of an Iran-based hacking group
called the Turk Black Hat security team, which had conducted hundreds of
website. Mesri allegedly also worked on behalf of the Iranian military to
conduct computer network attacks that targeted military systems, nuclear
software systems, and Israeli infrastructure.
The Indictment charges that
Mesri engaged in extortion against Home Box Office, Inc. after he had allegedly
hacked into the company's computer servers and stole proprietary data,
including information about then-unreleased episodes of "Barry," "Ballers," "Curb Your Enthusiasm,"
"Room 104," and "The Deuce;" and "Game of Thrones." READ the FULL TEXT INDICTMENT
SEC Obtains Judgment
Against Attorney Who Defrauded Escrow Clients in Securities Fraud Scheme (SEC Litigation Release No. 23996; Accounting
and Auditing Enforcement Release No. 3908) Securities and Exchange Commission v. Jay Mac Rust and
Christopher K. Brenner, charges Rust and Brenner with fraud for making undisclosed
risky investments and in some instances outright stealing money they obtained
in escrow accounts from small business owners seeking commercial loans. Rust,
whose license to practice law was suspended for three years by the State Bar of
Texas as of August 15, 2017, was ordered to pay disgorgement and pre-judgment
interest of $191,783.01 and a civil money penalty of $160,706.79.
Operator of
Investment Scheme Involving Seniors Charged Criminally (SEC Litigation Release 23995) The United
States Attorney's Office for the Northern District of Illinois filed a criminal
Information charging Daniel H. Glick,
a Chicago investment adviser, with one count of wire fraud. Glick is a
defendant in a parallel SEC enforcement action United States v. Daniel Glick,
No. 17-CR-739 (N.D. Ill.). SEC v. Daniel H. Glick, et al, No. 17-CV-2251
(N.D. Ill.) The Information alleges that from at least 2011 through at least
2017, Glick misappropriated at least $5.2 million from clients and financial
institutions, furnished forged checks and other phony documents to financial
institutions, and lied to clients about the use and safety of their
investments. Most of the misappropriated funds allegedly belonged to elderly
clients, including Glick's mother-in-law and father-in-law and an individual in
a nursing home. The SEC's emergency action are based on substantially the same
conduct.
FINRA Plays Hide And
Seek With Six Years Of Unauthorized Sales And Withdrawals (BrokeAndBroker.com Blog) In a recent
FINRA regulatory settlement, the lack of explanation as to the basic elements
of the case is baffling. Either the regulator doesn't think the facts are
important or it never got the facts or it lacks the ability to convey such
information. You judge for yourself.
http://www.rrbdlaw.com/3681/securities-industry-commentator/
In today's
Securities Industry Commentator feed:
In the Matter of
Shervin Neman and Neman Financial, Inc. (Initial Decision, Securities and
Exchange Commission, Init. Dec. Rel. No. 1227; Admin. Proc. File No. 3-17699 /
November 20, 2017) Administrative Law Judge Jason S. Patil's "Initial
Decision" imposes industry bars against Neman and revokes the firm's registration.
A fascinating aspect of ALJ Patil's rationale is found in his consideration of
whether Neman is likely to engage in future violations and if he has shown remorse
for his misconduct.
SEC Charges
Individual and His Company with Operating an Unregistered Dealer Business (SEC
Litigation Release No. 23992 / November 20, 2017) As set forth in pertinent part in the SEC
Litigation Release, the federal regulator alleged that Defendants Almagarby and
MEG purchased over $1.1 million of aged debts of 39 microcap issuers and sold
into the market over 7.4 billion shares generating over $1.4 million in
ill-gotten gains. READ FULL TEXT SEC COMPLAINT: Securities and Exchange
Commission, Plaintiff, v. Ibrahim Almabarby and Microcap Equity Group LLC,
Defendants (Complaint, United
States District Court for the Southern District of Florida, 17-CV-62255 /
November 17, 2017)
Department of Justice
Memorandum: Prohibition on Improper Guidance Documents (DOJ Memorandum) Attorney
General Jeff Sessions issued a memo prohibiting the Department of Justice from
issuing guidance documents, which purportedly were used at times to circumvent
the rulemaking process by attempting to change the law or to impose new
compliance standards.
In the Matter of
Martin Shkreli (Order on Motion for Summary Disposition, Securities and
Exchange Commission, Admin. Proc. Rul. Rel. NO. 5233;Admin. Proc. File No.
3-18127 / November 17, 2017). Administrative Law Judge James E. Grimes granted
in part and denied in part the Motion citing the existence of a material
question as to whether Shkreli was associated with an investment adviser at the
time of his misconduct
Spoofing Email Sends Payment To Minneapolis, Shanghai, And Bremen (BrokeAndBroker.com Blog) The BrokeAndBroker.com Blog has frequently covered stories involving spoofed emails that are sent to banks and brokerage firms. Sometimes the recipients of these fraudulent emails are victims. Sometimes, they're complicit. Sometimes, folks just go about their day and despite all sorts of memos and policies over the years warning them against accepting emails at face value, they disregard protocol and set off an avalanche of trouble and pain. As demonstrated in a recent federal criminal case, we got lots of scamsters alive and well out there in cyberspace.
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In today's Securities Industry Commentator feed:
Yelp Inc., Petitioner, v. The Superior Court of
Orange County, Respondent; Gregory M.
Montagna et al., Real Parties in Interest - AND - Gregory M. Montagna et al., Plaintfiffs and Respondents, v. Yelp
Inc., Objector and Appellant (Opinion, Court of Appeal of the State of
California, Fourth Appellate District, G054358 consolidated with G054422 /
November 13, 2017. Yelp Inc. petitions to overturn an order compelling its
production of documents that may reveal the identity of an anonymous reviewer
on its site.
Federal Court Sanctions
Gerard Suite and STA Opus LLC for Commodity Pool Fraud and Frank Collins for
Misappropriation of Customer Funds / Defendants Ordered to Pay Restitution and
Civil Monetary Penalties Totaling More Than $4.5 Million (CFTC Press Release pr7647-17)