Securities Industry Commentator by Bill Singer Esq

February 20, 2018

Jury Convicts KC Man of Investment Fraud Scheme (DOJ Press Release) After about two hours of deliberation, a federal jury convicted Ryan Scott Luscombe of three counts of wire fraud, two counts of mail fraud and one count of money laundering in connection with his solicitation of about $483,482 in investments for his business, Five Star Trading Group, Inc. Luscombe had claimed that he would utilize his stock trading expertise to produce exorbitant returns. Luscombe used the funds for on personal expenditures including the purchase of a 2010 BMW 750I and a trip to Bermuda. 

SEC Suspends Trading in Three Issuers Claiming Involvement in Cryptocurrency and Blockchain Technology Litigation Release 2018-20) The SEC issued Trading Suspension Orders based upon allegations that press releases issued by Cherubim Interests Inc. (CHIT), PDX Partners Inc. (PDXP), and Victura Construction Group Inc. (VICT) claimed that those companies had acquired AAA-rated assets from a subsidiary of a private equity investor in cryptocurrency and blockchain technology; and, in the case of CHIT, based upon that's company's announcement about the execution of a financing commitment to launch an initial coin offering. The SEC alleges that the Orders were issued based upon questions about the companies' business operations and the value of their assets, and, CHIT's alleged delinquency in filing annual and quarterly reports. READ the FULL TEXT ORDERS for  CHT, PDXP

Pro Se Former Nationwide Employee Wins $1 And CRD Expungement ( Blog)
As readers of the Blog know, pro se litigants don't always obtain a great outcome. In some cases, the financial award rendered in favor of or against a self-represented party justified the decision to no incur legal fees. In other cases, self-represented parties could not afford to hire a lawyer and suffered for the lack of counsel. In a recent FINRA intra-industry arbitration, a former associated person sued his former employer firm in an effort to obtain the expungement of disputed language from his Form U5/CRD records. There is no question that this pro se Claimant walked away a winner. There is a question as to whether he should have sued for more.

United States of America, v. Steven Metro, Defendant/Appellant (Opinion, United States Court of Appeals for the Third Circuit, No. 16-3813, February 14, 2018)  This appeal involves a New York City law firm's former managing clerk, Steven Metro, who between February 2009 and January 2013, allegedly used his position at the law firm to obtain material nonpublic information concerning thirteen distinct corporate transactions. As set forth in the Syllabus to the 3Cir's Opinion:

Steven Metro appeals from the 46-month sentence of imprisonment imposed by the District Court as a consequence of his guilty plea to one count of conspiracy to violate federal securities laws and one count of insider trading. He contends that the Court wrongly attributed to him illicit financial gains actually attributable to someone with whom he was not acting in concert and to whom he did not provide inside information. Because the District Court's factual findings are insufficient to support the sentence, we will vacate and remand for resentencing.