SEC Charges Former JPMorgan Traders Javier Martin-Artajo and Julien Grout with Fraud

Posted on August 14, 2013 by BraunHagey & Borden

SEC v. Javier Martin-Artajo and Julien G. Grout, Case No. 13-cv-5677 (S.D.N.Y.).  On August 14, 2013, the SEC announced fraud charges against Traders Javier Martin-Artajo and Julien Grout, former traders at JPMorgan Chase & Co.  In a parallel action, the U.S. Attorney’s Office for the Southern District of New York today announced criminal charges
against them.  The SEC alleges that Martin-Artajo and Grout worked in JPMorgan’s chief investment office (“CIO”), which created a portfolio known as Synthetic Credit Portfolio(“SCP”).  The portfolio was invested in credit derivative indices.  Continue reading →

Posted in Securities | Tagged , , | Leave a comment

CFTC Charges Worth Group, Inc., Andrew Wilshire and Eugenia Mildner in Alleged Precious Metal Scheme

Posted on August 14, 2013 by BraunHagey & Borden

CFTC v. Worth Group, Inc., Andrew Wilshire, and Eugenia Mildner, Case No. 9:13-cv-80796 (S.D. Fla.).  On August 13, 2013, the CFTC announced fraud charges against Worth Group Inc., its owner, Andrew Wilshire, and its director, Eugenia Mildner.  According to the CFTC, Worth purported to sell physical metal, like gold and silver, on a fully-paid or financed basis.  The CFTC alleges that Worth lied to customers by telling them that it would deliver the metal either to them directly or to a depository.  In reality, Worth did not deliver metal to the customers. Rather, it would buy metals derivatives in accounts owned by Worth. Continue reading →

Posted in Commodities | Tagged , , | Leave a comment

SEC Files Settled Fraud Action against CFO Dale Ringgenberg and Anchor Bancorp Wisconsin

Posted on August 14, 2013 by BraunHagey & Borden

SEC v. Anchor Bancorp Wisconsin, Inc. and Dale C. Ringgenberg, Case No. 1:13-cv-01241 (D.D.C.).  On August 14, 2013, the SEC announced it filed a settled fraud action against Anchor Bancorp Wisconsin and its former CFO Dale Ringgenberg.  The SEC alleges that Ringgenberg engaged in conduct designed to keep from having to correct earnings that Anchor had already released to its shareholders in an SEC Form 10-Q.  According to the SEC, Ringgenberg altered an estimate to offset an accounting adjustment required by Anchor’s external auditors.  Continue reading →

Posted in Securities | Tagged , , , , | Leave a comment

SEC Obtains Emergency Relief against Anthony Davian and His Asset Management Firm

Posted on August 14, 2013 by BraunHagey & Borden

SEC v. Anthony J. Davian and Davian Capital Advisors, LLC, Case No. 5:13-cv-1762 (N.D. Ohio.).  On August 14, 2013, the SEC announced it obtained a temporary restraining order and asset freeze against Anthony Davian and his asset management firm for allegedly defrauding investors in hedge funds they manage.  According to the SEC, Davian raised around $1.5 million from investors in funds managed by Davian Capital.  The SEC alleges that Davian gave investors marketing materials that falsely claimed high returns for investors.  Continue reading →

Posted in Securities | Tagged , , , , | Leave a comment

SEC Charges Joseph Tocci with Insider Trading

Posted on August 13, 2013 by BraunHagey & Borden

SEC v. Joseph M. Tocci, Case No. 1:13-cv-11924 (D. Mass.).  On August 12, 2013, the SEC announced insider trading charges against Joseph M. Tocci.  The SEC alleges that Tocci traded on the basis of confidential information he obtained when he was the assistant treasurer of American Superconductor.  According to the SEC, he bought option contracts hoping the company’s stock price would fall after some negative news was publicly released.  The SEC alleges that Tocci learned that the company’s largest customer had refused to accept shipments scheduled for delivery by the close of the company’s fiscal year and was delinquent in paying for earlier shipments.  Continue reading →

Posted in Securities | Tagged , , | Leave a comment

SEC Obtains Emergency Asset Freeze against Steven Heinz

Posted on August 12, 2013 by BraunHagey & Borden

SEC v. Steven B. Heinz, et al., Case No. 2:13-cv-00753 (D. Utah).  On August 8, 2013, the SEC announced it obtained a temporary restraining order and emergency asset freeze against Steven B. Heinz and his company S.B. Heinz and Associates, Inc.  The SEC alleges that Heinz raised almost $4 million from former clients, family members, and friends to assist him in executing rapid buy and sell orders of futures contracts. According to the SEC, Heinz used investor money to make it appear as though he is running a successful investment business when, in reality, S.B. Heinz suffered around $1.5 million in trading losses.  Continue reading →

Posted in Securities | Tagged , , , , , | Leave a comment

SEC Issues Risk Alert On Options Trading Used To Evade Short-Sale Requirements

Posted on August 12, 2013 by BraunHagey & Borden

On August 9, 2013, the SEC issued this risk alert designed to detect and prevent options trading that attempts to circumvent Regulation SHO which governs short sales.

Posted in Securities | Tagged , | Leave a comment

SEC Charges Bank of America with Fraud in Connection with Offering of Mortgage-Backed Securities

Posted on August 7, 2013 by BraunHagey & Borden

SEC v. Bank of America et al., Case No. 3:13-cv-447 AVC (W.D.N.C.).  On August 6, 2013, the SEC announced fraud charges against Bank of America and two subsidiaries related to an offering of residential mortgage-backed securities (“RMBS”).  According to the SEC, Bank of America together with Banc of America Securities LLC (now Merrill Lynch, Pierce, Fenner & Smith) and Bank of America Mortgage Securities (“BOAMS”) conducted the $855 million RMBS offering in 2008.  The offering was marketed as appropriate for conservative RMBS investors.  Continue reading →

Posted in Securities | Tagged , , , | Leave a comment

SEC Charges Cort Poyner and Mohammad Dolah with Market Manipulation

Posted on August 6, 2013 by BraunHagey & Borden

SEC v. Cort Poyner and Mohammad Dolah, Case No. CV 13-4331 (E.D.N.Y).  On August 6, 2013, the SEC announced fraud charges against Cort Poyner and Mohammad Dolah in
connection with an alleged bribery scheme designed to manipulate the market for Resource Group International, Inc. (“Resource Group”) and Gold Rock Resources Inc. (“Gold Rock”) stock.  According to the SEC, Poyner, a repeat offender, and Dolah entered into a kickback arrangement with an individual whom they thought represented several registered representatives who would solicit customer purchases of stock in exchange for kickbacks.  Continue reading →

Posted in Securities | Tagged , , , , | Leave a comment

SEC Charges John Rizzo with Running A Boiler Room Scheme

Posted on August 6, 2013 by BraunHagey & Borden

SEC v. John G. Rizzo, Case No. 3:13-cv-01801 MMA BLM (C.D. Cal.).  On August 6, 2013, the SEC announced fraud charges against John G. Rizzo, the former CEO of iTrackr Systems Inc.  The SEC alleges that Rizzo used escrow agents and bank accounts in the U.S. to make iTrackr investments appear more legitimate.  However, once investors wired funds, Rizzo arranged to have the money transferred to bank accounts in Belize.  According to the SEC, he did this to hide his use of investor money to pay boiler room operators and his own expenses.  The SEC alleges that Rizzo would pay boiler room operators large commissions for the money they raised from investors.  He did not disclose this arrangement.  The SEC charged Rizzo with violating Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5. The SEC seeks financial penalties, disgorgement, officer-and-director and penny stock bars, and injunctive relief.

Posted in Securities | Tagged , , , | Leave a comment