Securities Industry Commentator by Bill Singer Esq

December 5, 2017

SEC Emergency Action Halts ICO Scam (SEC Pres Release 2017-219) https://www.sec.gov/news/press-release/2017-219
The SEC's new Cyber Unit filed its first charges charges in the United States District Court for the Eastern District of New York against Dominic Lacroix, and his company, PlexCorps alleging that Lacroix and PlexCorps used the Internet to market and sell PlexCoin securities, which were represented as yielding 1,354 percent profit in less than 29 days. Sabrina Paradis-Royer, Lacroix's alleged partner, was also charged. The SEC Press Release characterizes Lacroix as a "recidivist Quebec securities law violator," and also, characterizes PlexCoin as a "fast-moving Initial Coin Offering (ICO) fraud that raised up to $15 million from thousands of investors since August. . . " The SEC obtained an emergency court order freezing the assets of PlexCorps, Lacroix, and Paradis-Royer. READ the FULL TEXT Complaint https://www.sec.gov/litigation/complaints/2017/comp-pr2017-219.pdf

SEC Files Fraud Charges Against Microcap Company and Its CEO (SEC Litigation Release No. 2400) https://www.sec.gov/litigation/litreleases/2017/lr24000.htm 
The SEC filed a Complaint in the United States District Court for the Southern District of New York, alleges that a microcap company and its CEO conducted a fraudulent scheme to mislead investors about the company's success and prospects, hide its losses, inflate the value of its assets, and artificially prop up its stock price. READ the FULL TEXT COMPLAINT. As set forth in part in the SEC Press Release:

Premier Holding Corp. ("Premier"), a California-based company that describes itself as a green energy services provider, and its CEO, Randall Letcavage, orchestrated a series of purportedly important transactions with related parties designed to create the false appearance of an active company with a vibrant and promising business. According to the complaint, Premier and Letcavage used these transactions to mislead investors about the financial health of the company and to hide losses in Premier's financial statements. Among other things, Premier and Letcavage assigned a high value to Premier's most significant tangible asset, a promissory note, that they knew, recklessly disregarded, or should have known was incorrect. Premier and Letcavage allegedly misled investors about the value of this promissory note in filings with the SEC in 2013 and 2014.

The SEC also charged Joseph Greenblatt, a consultant who provided accounting services to Premier. According to the SEC's complaint, Greenblatt assisted Premier in preparing certain of its fraudulent financial statements, which included a valuation of the promissory note that he knew, recklessly disregarded, or should have known was inadequately supported.

Digital Display Advertising Firm, Executives Charged With Bilking Investors (SEC Press Release 2017-221) https://www.sec.gov/news/press-release/2017-221

The Securities and Exchange Commission filed a Complaint in the United States District Court for the Western District of Washington alleging that Digi Outdoor Media Inc.'s former chief executive officer, Donald MacCord Jr., and chief financial officer Shannon Doyle raised nearly $4.5 million in promissory notes by claiming they would use the funds to construct and install digital signs for commercial advertising around Washington, D.C.; however, they allegedly diverted millions for their personal use and use fake invoices and sham loans to further their fraud. Separately, federal criminal charges were filed against MacCord for conspiracy to commit wire fraud, submitting false writings to a government agency, obstruction of official proceedings, and destruction, alteration or falsification of records in federal investigations; and against Doyle for conspiracy to commit wire fraud and obstruction of official proceedings. READ the FULL TEXT SEC COMPLAINT

Health Care Fraud: Texas Doctor, Nurses Exploited 'Trust-Based' System (FBI Press Release)
https://www.fbi.gov/news/stories/health-care-fraud
In August 2017, Dr. Jacques Roy was sentenced to 35-years in federal prison and ordered to repay $268 million for his role in a conspiracy involving hundreds of thousands of patients in a home health care fraud; recently, Cynthia Stiger was the last of seven defendants sentenced in the scheme.  

Stockbrokers Succession Plan Grapples With Mine, Ours, and Yours (BrokeAndBroker.com Blog) http://www.brokeandbroker.com/3704/finra-succession-awc/ 

With Wall Street's Baby Boomers heading into retirement and new blood angling to take over the departing reps' accounts, today's featured FINRA disciplinary settlement offers some guidance concerning what appears to be a succession plan that arranged to migrate shared accounts to the exclusive oversight of the eventual successor rep. As with such hand-offs of business from the former to the new guy, not everything was anticipated and it seems that no one fully thought through how the former rep would stay connected with customers during the transition. You got "my" business, you got "our" business, and you got "your" business and all those different states came crashing together in a problematic fashion. By way of comparison, consider how the New York Giants football team has to decide this weekend whether Eli Manning will be the starting QB for the rest of the season and who will be the General Manager and Coach.  Some things you plan for, some things you have to deal with on the run, and some things you have to fudge.