But panic is surging as more states shutter businesses and order people to stay mostly indoors. Consumer demand for items like beef, chicken and fish has dropped as restaurants close indefinitely. More people are opting for cheaper, nonperishable goods like pasta and beans at grocery stores. 

"It's not looking good. Product can't be moved. Farmers are very concerned," said Aubrey Onley, a farmer in Perquimans County, North Carolina.

The numbers are grim: Corn futures have declined almost 10%, soybean futures more than 4% and wheat futures nearly 2% in the past several weeks. Futures prices for lean hogs have dropped 12% in the past two weeks and prices for cattle have declined nearly 13%. 

Below please find links to certain TM-related documents in response to the effects of COVID-19. This is not an exhaustive list. Please refer to the SEC Coronavirus (COVID-19) Response page for more information:

United States v. Nicholas Palumbo, et al.

In the first case, the District Court issued a preliminary injunction against spouses Nicholas and Natasha Palumbo of Scottsdale, Arizona, and the Arizona companies they own and operate, Ecommerce National LLC d/b/a TollFreeDeals.com and SIP Retail d/b/a sipretail.com.  The District Court held, in a written opinion, that the evidence presented by the United States demonstrated probable cause to conclude that the defendants were engaged in "widespread patterns of telecommunications fraud, intended to deprive call recipients in the Eastern District of New York and elsewhere of money and property."

The preliminary injunction issued by the court bars those defendants from carrying any VoIP calls destined for phones in the United States and providing any U.S. telephone numbers (often used as call-back numbers in the fraudulent robocalling schemes) to any individuals or entities during the pendency of this litigation.  The court noted that though defendants had been warned more than 100 times of specific instances of fraudulent calls being transmitted through their network, they never severed their business relationship with any entity they learned was associated with fraudulent call traffic, prior to the United States' filing of its lawsuit.  The court further noted that "the telecommunications 'intermediary' industry is set up perfectly to allow fraudulent operators to rotate telephone numbers endlessly and blame other parties for the fraudulent call traffic they carry," that the United States "demonstrat[ed] probable cause to conclude that defendants' business is permeated with fraud," that "multiple individual victims in the United States suffered significant fraud losses," and that "[e]very day that the defendants' actions in this vein continue, the public is at risk of harm in the form of additional high-dollar fraud losses."

. . .

United States v. John Kahen, et al.

In the second case, the District Court entered consent decrees permanently resolving the matter against five individuals and entities who were also operating intermediary VoIP carriers.  The court entered a consent decree on March 2, 2020 against Jon Kahen, a/k/a Jon Kaen of New York, and New York corporations Global Voicecom Inc. and Global Telecommunication Services Inc., permanently barring those defendants from, among other things, using the U.S. telephone system to: deliver prerecorded messages through automatic means, carry calls to the United States from foreign locations, and provide calling and toll-free services for calls originating in the United States.  In addition, the defendants are permanently barred from serving as employees, agents, or consultants to any person or entity engaged in these activities.  In a second consent decree, entered on March 24, 2020, the District Court barred KAT Telecom Inc., a New York corporation, from conveying or causing any other person or entity from conveying fraudulent telephone calls, fraudulent recordings, and unauthorized "spoofed" telephone calls.  In the event that KAT Telecom, Inc. resumes operations, it must also implement strong anti-fraud measures, including anti-fraud monitoring, mitigation, and know-your-customer measures.

Louis Ottimo appeals an Extended Hearing Panel decision issued on July 10, 2015. The Extended Hearing Panel found that Ottimo fraudulently omitted material information in a personal biography in the offer and sale of securities, in violation of Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act"), Rule 10b-5 thereunder, and FINRA Rules 2020 and 2010. It further found that Ottimo willfully failed to disclose or disclose timely on the Uniform Application for Securities Industry Registration or Transfer ("Form U4") material information related to his unsatisfied tax liens, judgments, and a bankruptcy filing, in violation of FINRA Rules 1122 and 2010, NASD IM-1000-1, and Article V, Section 2(c) of FINRA's ByLaws. For his fraud violation, the Extended Hearing Panel barred Ottimo from association with any FINRA member in all capacities. For his Form U4 violation, the Extended Hearing Panel assessed, but in light of the bar did not impose, a $25,000 fine and a two-year suspension in all capacities. The Panel also found Ottimo's misconduct was willful, as a result of which he was statutorily disqualified. On appeal, Ottimo challenges before the National Adjudicatory Council ("NAC") the Extended Hearing Panel's fraud findings and corresponding sanction. He does not challenge the Extended Hearing Panel's Form U4 findings but requests the NAC to reduce the Panel's assessed sanctions. Based on an independent review of the record, we affirm the Extended Hearing Panel's findings of violation and sanctions. 

I. Background 

Ottimo entered the securities industry in 1995. He was employed with several FINRA member firms before he joined his father's brokerage firm, EKN Financial Services Inc. ("EKN" or "Firm"), as a general securities representative in 2008. Prior to his association with EKN, Ottimo was the co-owner of Jet One Jets, Inc. ("Jet One Jets"), a broker that arranged private jet charters, and the owner and president of Wheatley Capital Corporation ("Wheatley"), a company that handled back-office operations for EKN. In February 2012, Ottimo created and sold interests in First Secondary Market Fund LLC ("Fund"), a special purpose vehicle created to purchase shares of Facebook Inc. ("Facebook") in the secondary market before its initial public offering ("IPO"). FINRA expelled EKN in October 2012. Ottimo's most recent employer terminated his registration in February 2014 and he has not associated with a FINRA member firm since then. 

Louis Ottimo, a former registered representative with EKN Financial Services Inc. ("EKN"), a former FINRA member firm, seeks review of a FINRA disciplinary action finding that he fraudulently omitted information from his biography in a private placement memorandum (the "PPM") in violation of Section 10(b) of the Securities Exchange Act of 1934, Rule 10b-5 thereunder, and FINRA Rules 2020 and 2010. FINRA also found that Ottimo failed timely and accurately to update his Uniform Application for Securities Industry Registration or Transfer ("Form U4") to reflect unsatisfied tax liens, judgments, and a bankruptcy filing in violation of FINRA Rules 1122 and 2010, NASD IM-1000-1, and Article V, Section 2(c) of FINRA's ByLaws. For the fraud violations, FINRA imposed a bar. For the Form U4 violations, FINRA assessed -- but in light of the bar did not impose -- a $25,000 fine and a two-year suspension in all capacities. FINRA also found that Ottimo's misconduct was willful and that he was statutorily disqualified from association with a FINRA member firm as a result. 

We affirm FINRA's finding of the Form U4 violations, which Ottimo does not challenge, and affirm in part its findings of fraud as to the PPM. But part of FINRA's fraud findings is not supported by the record. Accordingly, we remand for FINRA to reassess the sanctions. 

This matter is before us on remand from the Securities and Exchange Commission ("Commission"). In our initial decision, the National Adjudicatory Council ("NAC") found that Louis Ottimo fraudulently omitted material information in his private placement memorandum ("PPM") biography in the offer and sale of securities, in violation of Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act"), Exchange Act Rule 10b-5, and FINRA Rules 2020 and 2010. The NAC further found that Ottimo willfully failed to amend, or amend timely, on the Uniform Application for Securities Industry Registration or Transfer ("Form U4") material information related to his unsatisfied tax liens and civil judgments, and a bankruptcy filing. For his fraud violation, the NAC barred Ottimo from associating with any FINRA member in all capacities. For his Form U4 violations, the NAC assessed a two-year suspension in all capacities and a $25,000 fine, but in light of the bar did not impose them. Because Ottimo engaged in willful misconduct, he was subject to statutory disqualification. See Dep't of Enforcement v. Ottimo, Complaint No. 2009017440201, 2017 FINRA Discip. LEXIS 10 (FINRA NAC Mar. 15, 2017). 

On appeal to the Commission, Ottimo challenged only those portions of the NAC's decision that found him liable for engaging in fraud. The Commission affirmed FINRA's findings that Ottimo repeatedly failed to timely and accurately report material information on his Form U4 in violation of FINRA rules, and that his violations were willful. Thus, Ottimo is statutorily disqualified. The Commission further affirmed FINRA's findings that Ottimo violated the antifraud provisions under SEC and FINRA rules, with one exception. The Commission found that Ottimo willfully violated Exchange Act Section 10(b) and Rule 10b-5, and FINRA Rules 2020 and 2010, by omitting material facts in his PPM biography related to Jet One Jets, Inc. ("Jet One Jets"), a private jet charter company he co-owned. The Commission also sustained FINRA's finding that Ottimo is statutorily disqualified on this ground. The Commission, however, set aside FINRA's finding that Ottimo's failure to disclose bankruptcy information regarding Wheatley Capital Corporation ("Wheatley") constituted a material omission of fact that made his biography in the PPM misleading. Because the Commission set aside a portion of the fraud findings, it remanded the case to FINRA to re-determine the sanctions. See Louis Ottimo, Exchange Act Release No. 83555, 2018 SEC LEXIS 1588 (June 28, 2018). 

Having reconsidered the matter based on the full record, the Commission's findings of violation, and the briefs the parties submitted on remand, we impose the sanction of a bar on Ottimo. As explained below, we do so based on Ottimo's fraudulent omissions regarding Jet One Jets, and assess, but in light of the bar do not impose, a two-year suspension and $25,000 fine for his Form U4 violations. 

On remand, Enforcement argues that we should impose the same sanctions for Nash's supervisory failures that were imposed in the NAC Decision. We are cognizant, however, that the Commission dismissed one of the bases for those sanctions and, accordingly, we find that a reduction of the fine and suspension imposed in the NAC Decision is appropriate. We also note that the supervisory violations that were affirmed by the Commission are serious and warrant significant sanctions. Accordingly, we find that a $22,500 fine, a ten-month suspension in all principal and supervisory capacities, and a requirement that Nash requalify by examination as a registered principal before again acting in that capacity are appropriately remedial sanctions for Nash's violations.