Securities Industry Commentator by Bill Singer, Esq.

October 15, 2017

BrokeAndBroker.Com Blog By Bill Singer WEEK IN REVIEW
Wall Street legal, regulatory, and compliance cases and developments analyzed by veteran industry lawyer Bill Singer

Coup Attempt in The Gambia / Military Action Violated Federal Neutrality Act

When I first read this FBI piece, I misread it:
"He said, I need to get back to the United States. The Gambians are looking for me,'"said Special Agent Jeffrey Van Nest from the FBI's Minneapolis Field Office. "When embassy staff asked why, Faal said he was part of the attempted coup. That's when we got involved."

I thought this was about the FBI going after the Gambino Family -- turns out it was the Gambians!

Pump and Dump Scheme Guilty Verdict Affirmed
UNITED STATES OF AMERICA, Appellee, v. RICHARD WEED, Defendant/Appellant (Opinion, United States Court of Appeals For the First Circuit No. 16-2120 / October 6 2017). 

"HOWARD, Chief Judge. Richard Weed, a securities lawyer, wrote false opinion letters so that his two co-conspirators could sell stock to the public in a "pump and dump" scheme.1 In connection with this conduct, he was convicted of securities fraud, wire fraud, and conspiracy to commit both. Following the jury's guilty verdict, Weed moved for a judgment of acquittal. He argued that the evidence was insufficient to support his convictions, relying on a novel interpretation of a particular Securities Act provision. The district court denied Weed's motion. After careful consideration, we affirm."

SEC Files Charges in Futures Trading Scheme 

We like to fool ourselves . . . we like to pretend that there has to be some sophistication to investment fraud. In truth, it doesn't seem to require much more these days than targeting folks who don't want to bother doing due diligence and who think that there's always some genius of a trading guru out there who's just dying to take their money and produce breath-taking profits. In this recent SEC Complaint, the federal regulator alleges that David Weddle, the majority owner of JustInfo, and Scott Allensworth, doing business as Capital Growth Group Associates, raised at least $2.84 million from at least 57 investors by selling investment contracts; but, rather than trade those funds, the two stole at least $1 million for their own use and to make payments of purported returns to prior investors in classic Ponzi-fashion. Weddle allegedly created false trading reports, which Allensworth sent to investors, to cover up JustInfo's trading losses and maintain the appearance that the investment was profitable.