Securities Industry Commentator by Bill Singer Esq

March 23, 2018

SEC Obtains Permanent Officer-and-Director and Penny Stock Bars Against CEO of Syringe Manufacturer (DOJ Litigation Release No. 24072)
A federal jury in the United States District Court for the Northern District of Georgia found that Revolutions Medical Corp. and its CEO, Ronald L. Wheet had engaged in securities fraud by issuing press release that had falsely portrayed the company as:
  • a successful manufacturer of a safe and effective syringe slated for imminent mass production and distribution; and
  • having secured significant sales agreements, including one with the U.S. Department of Defense. 
In addition to enjoining the defendants from violations of the '33 and '33 Acts, the Court ordered Revolutions Medical and Wheet, to pay  $2.325 million and $465,000, respectively, in civil penalties; and to pay, jointly and severally, $115,000 in disgorgement. of $115,000. Further the SEC obtained lifetime officer-and-director and penny stock bars against Wheet. Securities and Exchange Commission v. Revolutions Medical Corp., et al., (12-CV-03298 (NDGA) READ the FULL TEXT Judgment and Permanent Injunction.

Former Equifax Executive Charged with Insider Trading (SEC Litigation Release No. 24073 )
In a Complaint filed in the United States District Court for the Northern District of Georgia, the SEC alleged that former Chief Information Officer of Equifax's United States business unit, Jun Ying, had engaged in insider trading in advance of the company's September 2017 announcement of a data breach that exposed the social security numbers and other personal information of about 148 million U.S. customers. Ying purportedly avoided over $117,000 in losses by exercising and selling his vested Equifax stock options..Securities and Exchange Commission v. Jun Ying (18-CV-01069, NDGA) READ the FULL TEXT SEC Complaint 

Merrill Lynch Wins Puerto Rico Bond Arbitration Via Counterclaim ( Blog)
Frequent readers of the Blog know that our publisher Bill Singer, Esq. is a long-suffering critic of FINRA Arbitration. In particular, Bill frequently derides what he calls the "lack of content and context" in the arbitration forum's published decisions. Notwithstanding that he is often dismissed as a gadfly, a nit-picker, or a pain in the ass, Bill is unapologetic for shining an unwelcome light upon the inequities of mandatory consumer and industry arbitration, and upon the woeful state of FINRA's published/public disclosures. That being said, today, all the angels are singing and heaven is a happy place because Bill absolutely loves a recently published FINRA Arbitration Decision involving the thorny issue of an angry public customer's investments in unpopular Puerto Rican debt.

(SEC Litigation Release No. 24075)
The  SEC filed a Complaint in the United States District Court for the Southern District of New York alleging that Robert M. Murray purchased Fitbit call options minutes before a fake tender offer that he orchestrated was filed on the SEC's EDGAR system. Fitbit's spiked when the tender offer became publicly available on Nov. 10, 2016, and Murray sold all of his options for a profit of approximately $3,100. Securities and Exchange Commission v. Robert W. Murray (17-CV-03788 SDNY). A crininal complaint arising from the same underlying facts was filed in United States v. Robert M. Murray (17-CR-00452, SDNY). Following his guilty plea in the criminal case, Murray was sentenced to  two years imprisonment. READ the SEC Complaint

Irvine Man Found Guilty of Defrauding Businessman out of $648,000 with Claims Investment would Develop Stem Cell Research Product (DOJ Press Release)
After a two-day trial, Aiman Alexander Ataba was found guilty in the United States District Court for the Central District of California of eight counts of mail fraud and three counts of money laundering in connection with defrauding a businessman via a bogus stem cell research investment. Federal prosecutors alleged that Ataba falsely represented that his company, Fountain Valley business, Innovation Validation and Design Technologies would manufacture and sell a device that would be used in hospitals for stem cell research and that the company was on the verge of being acquired. Over 4 1/2 years, the victim invested $648,000 in exchange for stock warrants. Ataba purportedly diverted the investment from the business to his personal account and withdrew about $350,000 for personal uses such as rent, restaurants, a car purchase, and gambling.