The Wall Street Legal & Regulatory Feed
Securities Industry Commentator by Bill Singer Esq
October 11, 2018
Forex Firm Targeting Small Investors Ordered to Halt Offerings (TSSB Release)
https://www.ssb.texas.gov/news-publications/forex-firm-targeting-small-investors-ordered-halt-offerings
https://www.ssb.texas.gov/news-publications/forex-firm-targeting-small-investors-ordered-halt-offerings
The Texas State Securities Board entered an Emergency Cease and Desist Order against GoForex Group, a firm that claims it is a legally registered private investment firm and offering a return of 900% on investors' money in 21 days via the efforts of a team of hundreds of foreign currency traders and other professionals with expertise in real estate and oil and gas investing. TSSB alleges that neither GoForex or two associated persons named in the Order are registered to sell investments in Texas. Further, TSSB alleges that the company has published a business registration certificate on its website, but it is a fraudulent document that was digitally modified from a certificate issued by the International Business Companies Registry of Belize. READ the FULL TEXT TSSB Order https://www.ssb.texas.gov/sites/default/files/ENF-18-CDO-1770_GOFOREX%20GROUP.pdf
Court Enters Final Judgment Against Former Nomura Rmbs Trading Supervisor, Ordered Barred from Association with Brokerage Firms (SEC Litigation Release No. 24312)
https://www.sec.gov/litigation/litreleases/2018/lr24312.htm
In a Complaint filed in the United States District Court for the Southern District of New York, the SEC charged the former head of Nomura Securities International residential mortgage backed securities ("RMBS") trading desk, Ross B. Shapiro with violations of Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder, and Section 17(a) of the Securities Act of 1933. The final judgment permanently enjoins Shapiro from violating these antifraud provisions of the federal securities laws and orders Shapiro to pay a $200,000 civil penalty. An SEC administrative Order barred Shapiro from associating with any broker-dealer or investment adviser and participating in any offering of a penny stock, with a right to reapply for securities industry licenses after two years. Shapiro consented to the entry of the final judgment and administrative order against him without admitting or denying the charges. The Complaint alleged that Shapiro misrepresented the bids and offers provided to Nomura for RMBS, the prices at which Nomura bought and sold RMBS, and the spreads the firm earned for intermediating trades. This settlement fully resolves the charges against Shapiro. The civil case remains pending against two defendants who traded RMBS at Nomura, Michael Gramins and Tyler Peters.
READ the FULL TEXT SEC:
Complaint https://www.sec.gov/litigation/complaints/2018/comp24312.pdf
Complaint https://www.sec.gov/litigation/complaints/2018/comp24312.pdf
Order https://www.sec.gov/litigation/admin/2018/34-84390.pdf
https://www.justice.gov/usao-ndga/pr/owners-currency-exchange-business-made-600-million-convicted-fraud
After a five-week jury trial in the United States District Court for the Northern District of Georgia, Defendants Tyson Rhame, James Shaw, and Frank Bell (the co-owners and Chief Operating Officer, respectively, of Sterling Currency Group, one of the largest Iraqi dinar exchangers in the United States) were convicted of mail and wire fraud conspiracy, as well as multiple counts of mail and wire fraud. Rhame and Bell were also convicted of making false statements to federal law enforcement agents. The jury acquitted the defendants of money laundering charges; and defendant, Terrence Keller was acquitted of all charges at trial. Between 2010 and June 2015, Sterling grossed over $600 million in revenue from the sale of the Iraqi dinar and other currencies, while Rhame and Shaw received over $180 million in distributions. Rhame posted information on Sterling's website falsely suggesting that the dinar was about to revalue; and, other times, he and Bell falsely claimed that Sterling would cash out investors at airports around the country following a dinar "revaluation." Further, the Defendants paid third parties to tout the dinar on conference calls and Internet chat rooms.
3 Floridians Charged in Counterfeit Bank Check Scheme (DOJ Release)
https://www.justice.gov/usao-wdpa/pr/3-floridians-charged-counterfeit-bank-check-scheme
In an 7-count Indictment filed in the United States District Court for the Western District of Pennsylvania, Calar Braxton (a/k/a Vivian Hugo and Taylor Crimson); Brian Omar Campbell (a/k/a Vincent Hugo and Troy Crimson); and Cheryl Brown (a/k/a Loraine Johnson) were charged with conspiracy to commit offenses against the United State; possessing and uttering counterfeit securities; and possession of stolen mail. Allegedly, Braxton, Campbell, and Brown stole mail addressed to individuals and if a check was inside the envelope, the Defendants recorded its account and routing numbers and used that information to produce counterfeit bank checks, which they used for purchases at retailers such as Victoria's Secret, Dick's Sporting Goods and Macy's Department Store. In executing a search warrant, the police recovered a laser printer, stolen mail, and blank stock used for printing checks.
Guest Blog: The Invisibly Vulnerable Pre-Retirees by Aegis J. Frumento, Esq. (BrokeAndBroker.com Blog)
http://www.brokeandbroker.com/4233/frumento-retirement/
Conventional wisdom says our retirement income be about 70% of our pre-retirement income. More recent research suggests that, with increasing health costs and all of us living longer, we need at least 130%. When I was working with wealth advisers at a big wire house, we thought "The Number" -- the net worth needed to fund an affluent retirement -- was about $4 million. With social security benefits included, and even at today's abysmally low interest rates, that still seems like it would maintain a $150,000 pre-retirement income lifestyle for about 30 years. The median pre-retirement income of the middle-middle-class is less, about $65,000, and to maintain that lifestyle over a 30-year retirement requires about $1.5 million.
SEC Announces Settlement in Insider Trading Case Against Former Executive (SEC Litigation Release No. 24311)
https://www.sec.gov/litigation/litreleases/2018/lr24311.htm
The United States District Court for the District of Connecticut entered a final judgment against former Harman International Industries, Inc. executive Dennis Wayne Hamilton, who had been charged in an SEC Complaint with five instances of insider trading in the company's stock. Hamilton agreed to disgorge $730,279 in ill-gotten gains and pay prejudgment interest of $102,145, and to pay a civil penalty of $584,047, which will be offset by $131,958 that he was ordered to pay in a parallel criminal action in which he pled guilty to one count of securities fraud and was also sentenced to eight months imprisonment. Also, Hamilton is enjoined from violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and Section 17(a) of the Securities Act of 1933; and subject to the imposition of an officer and director Bar. Further, the SEC ordered Hamilton, a CPA, from appearing or practicing before the SEC.
North Suburban Financial Adviser Charged with Fraud for Allegedly Swindling $2.5 Million from Elderly Clients (DOJ Release)
https://www.justice.gov/usao-ndil/pr/north-suburban-financial-adviser-charged-fraud-allegedly-swindling-25-million-elderly
In a criminal Information filed in the United States District Court for the Northern District of Illinois, financial advisor Lucita Zamoraz was charged with one count of mail fraud in connection with allegedly swindling more than $2.5 million from elderly clients. Allegedly, Zamoras targeted elderly individuals, particularly immigrants, as part of a scheme whereby she claimed that client funds would be invested in safe, low risk investments, when, in fact, she used some of the funds to make Ponzi-like payments to earlier investors and spent some or all of the money on personal and business expenses, including gambling costs, payroll expenditures, credit card payments, airline tickets, car payments, and utilities, the information states.READ the FULL TEXT Information https://www.justice.gov/usao-ndil/press-release/file/1100071/download
https://www.justice.gov/usao-nj/pr/former-new-york-law-firm-partner-sentenced-five-years-prison-conspiring-defraud-two-new
Former law firm partner Keila Ravelo pled guilty in the United States District Court for the District of New Jersey to conspiracy to commit wire fraud and tax evasion in connection with her use of bogus litigation support companies to obtain millions of dollars from two law firms where she was a partner,. Ravelo was sentenced to 60 months in prison plus three years of supervised release. Federal prosecutors had alleged that she and her husband, Melvin Feliz, formed two limited liability companies, which purported to provide litigation support to the firms, but in fact provided no actual services to the firms. In her capacity as a partner at the law firms, Ravelo approved payments to the companies. Feliz pled guilty to one count of conspiracy to commit wire fraud and one count of tax evasion.
Pickups and Put Downs: Remarks at the Financial Planning Association 2018 Major Firms Symposium (Speech by SEC Commissioner Hester Peirce)
https://www.sec.gov/news/speech/speech-peirce-100218