Securities Industry Commentator by Bill Singer Esq

Let's Go to the Video: SEC Gamifies Wall Street Regulation During Pandemic And Economic Crisis (BrokeAndBroker.com Blog)

Former Tennessee Securities Broker-Dealer Sentenced To 78 Months' Imprisonment For Embezzling $5.7 Million From Employee Pension Benefit Plan (DOJ Release)

Los Angeles Man Sentenced to Federal Prison for Bank Fraud and Identity Theft Scheme (DOJ Release)

U.K. National Sentenced to 3 Years in Prison for $8.3 Million Scam That Claimed Precious Metals Could Be Extracted from 'Ancient Slag' (DOJ Release)

Three Charged with Conspiracy to Defraud Five People of $3.25 Million in Investment Fraud Scheme (DOJ Release)

Man Who Ran $1.4 Million Ponzi Scheme from Prison Sentenced to 8 More Years (DOJ Release)

Tulsa Man Sentenced for Defrauding Investor and Banks of Millions (DOJ Release)

Former Bank Employee Admits $8 Million Fraud and Bribery Scheme (DOJ Release)

Houston area unlicensed cryptocurrency business results in conviction (DOJ Release)

Jury finds Canal Winchester man guilty on all counts in romance scam money laundering conspiracy (DOJ Release)

CFTC Charges Gemini Trust Company for Making Material False or Misleading Statements and Omissions to the Commission (CFTC Release)

SEC Charges Global Steel Pipe Manufacturer with Violating Foreign Corrupt Practices Act / Tenaris to pay $78 million to settle charges related to Brazilian bribery scheme (SEC Release)

SEC Charges Former CCO of Investment Adviser Who Misappropriated Funds (SEC Release)

SEC Obtains Final Judgments Against Crowdfunding Issuer and Its CEO (SEC Release) 

SEC Charges Former Executive of Network Infrastructure Company with Accounting Fraud (SEC Release)

SEC Charges Louisiana Town and Former Mayor with Fraud in Two Municipal Bond Deals / Town's Municipal Advisor and its Owner also charged (SEC Release)

SEC Obtains Final Judgment Against Tech Employee Charged with Insider Trading (SEC Release)

SEC Charges New York Grocery Supermarket Chain and CEO for Financial Fraud (SEC Release)

SEC Obtains Final Judgments Against Illinois Company and Its President for Affinity Fraud Targeting Christian Investors (SEC Release)

FINRA Appoints Michael Solomon Senior Vice President of Examinations (FINRA Release)

FINRA Orders Merrill Lynch, Pierce, Fenner & Smith, Inc. to Pay $15.2 Million in Restitution (FINRA Release)

[O]n April 9, 2021, Jumper forged signatures on fraudulent documents that purportedly authorized him to transfer funds from the pension plan on three separate occasions between March 2015 through April 2016.  Jumper used the embezzled funds to make unauthorized loans and investments for the purchase of a tubing plant in Arkansas and three other business, to pay off $1.2 million of his personal loans, and to cover his personal legal fees. In addition, Jumper received a personal interest in the businesses purchased with the embezzled pension funds, and his securities company, Alluvion Securities in Memphis, received over $1 million in fees from the sale of the Arkansas tubing plant.

The indictment stated that the Snow Shoe Refractories Employee Pension Plan for Hourly Employees included about 129 active and retired employees.  At the time the alleged $5.7 million embezzlement began, the pension plan assets were worth approximately $9.8 million. 

As a result of his fraudulent misappropriation of pension funds, Jumper has been the subject of civil and regulatory sanctions obtained by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA), a private corporation that acts as a self-regulatory organization for member brokerage firms and exchange markets.  On November 1, 2018, a federal district judge in the Western District of Tennessee granted the SEC's motion for default judgment against Jumper, and the court there entered a final judgment as to Jumper and his companies and businesses. The final judgment permanently enjoined Jumper from violating securities laws and ordered that he disgorge $5,700,000, representing profits gained as a result of the fraudulent conduct, together with prejudgment interest in the amount of $726,758.79.  On February 3, 2017, FINRA permanently barred him, with his consent, based on allegations that he misappropriated funds from the Snowshoe pension plan for his personal use and to infuse capital into his member firm, Alluvion Securities.

[S]ince his arrest in Los Angeles in March 2021, Oputa has failed to disclose to law enforcement the details of his many suspected fraud schemes. Instead, he has repeatedly misled investigators on his sources and level of income as well as basic biographical details such as his date of birth, where and with whom he lives, how many siblings he has, and whether his parents are still living. Oputa's repeated obfuscation of basic facts presented significant challenges to law enforcement. Despite these, investigators successfully uncovered a scheme Oputa concocted targeting an elderly couple residing in northeast Oregon.

In April of 2019, an elderly victim and his wife, both in their seventies, obtained a home equity line of credit from First Community Credit Union (FCCU). The couple accessed cash from this line of credit via an account they maintained at FCCU. Just two weeks after receiving the loan, Oputa called FCCU's customer-service line, pretending to be his elderly victim. Oputa verified his stolen identity with the victim's basic biographical details, account number, and monthly payment information. Oputa then proceeded to hijack his victim's account.

After linking the victim's bank account to his own email address, Oputa changed the mailing address on the account to a mailbox he controlled at a commercial mail drop in Los Angeles. Oputa then requested that a debit card linked to the account be issued to himself. Between June 2 and July 12, 2019, Oputa used the debit card to purchase 41 money orders at five U.S. Postal Service locations in the greater Los Angeles area. Together, the money orders totaled more than $32,000. Oputa deposited most of the money orders into bank accounts he maintained under other stolen identities at several Los Angeles banks. A review of records from one such account revealed that 74 money orders totaling nearly $71,000 had been laundered through it.

In mid-July 2019, the adult victim reported the unauthorized account activity to FCCU and local police. By then, FCCU had suffered losses exceeding $40,000. Local police referred the investigation to the U.S. Postal Inspection Service (USPIS).

From 2011 to November 2017, Godfree schemed to defraud victim-purchasers of material he identified as "ancient slag" and "gold ore." He was co-founder of The Minerals Acquisition Company (TMAC), a Pasadena-based outfit that offered to sell slag to victims who were told the company would be able to extract precious metals from this slag, which was generated from copper mining. TMAC sold ton-quantities of the slag with promises of refining the material and recovering precious metals. TMAC provided victims with supposedly attorney-certified "Certificates of Title" that purported to transfer ownership of the slag to victims.

Godfree fraudulently induced the victims to buy the "ancient slag" by falsely stating the "ancient slag" was valuable because it contained precious metals and a process would soon be available that could extract the precious metals supposedly in the slag.

In fact, Godfree and TMAC did not actually own most of the slag they sold, there was not a commercially viable process for extracting precious metals from the slag, and the business operation had not been endorsed by a lawyer.

Acting on Godfree's false promises, victims sent the company money by mailing checks to the TMAC offices in Pasadena and by wiring money to accounts that Godfree controlled. Godfree used the funds to pay for his personal expenses.

In total, Godfree and TMAC caused losses of approximately $8,336,965 to the victims of their fraud.

TMAC was dissolved in 2015, but its operations were largely taken over by Precious Metals of North America Inc., another of Godfree's companies.

During 2017, the conspirators advertised an investment opportunity in Standby Letters of Credit (SBLC), which are essentially a guaranty of payment by a bank or financial institution. The investments were offered through Hampton's company, 5 Star Investments LLC. Kuzma handled inquiries from potential investors, and forwarded investment contracts via email to potential investors. The contracts were deliberately vague and confusing, and contained false and fraudulent statements, including promising "guaranteed" returns which were unrealistic and which no investor had achieved, and promising to return the investor's monies if the SBLC's were not created. Davis was identified as the "asset manager," and investors were instructed to wire their investment monies to a bank account in the name of Davis' company, Jet Exclusive Aviation LLC.

From from March through May 2017, five investors entered into contracts with Hampton, Kuzma and Davis, and wired approximately $3.25 million to Davis' account. The defendants did not invest the monies as promised, but rather converted them for their own use. Within days of the first victim's "investment" money going into Davis' account, Davis began transferring money to his other bank accounts, and also to an account held in Hampton's relative's name. Hampton thereafter transferred some of the proceeds to Kuzma. In response to complaints by the victims, the defendants continued to falsely assure the victims that the investments were moving forward, and later that the victims would get their monies back. That did not happen. Instead, Hampton, Kuzma and Davis spent the victims' money on personal expenses, cars, and travel, and also transferred money to other bank accounts controlled by themselves or their family members.

[I]n September 2017, Mr. Carroll - already 36 months into a 70-month sentence for a prior fraud conviction - lied to investors about his intention to secure funding for their ventures and invest their funds into legitimate investment ventures.

He admitted that he pitched investors on bridge loans, short term loans used to buy assets or cover obligations until longer-term financing is found, promising 40 to 50 percent rates of return in just one to three months.  He claimed that each bridge loan was backed by a bank and therefore guaranteed.

He concealed the fact that he was a convicted felon, and if asked about it, claimed he had been falsely accused and had the charges dismissed.

Instead of actually investing the money, however, he set up a Ponzi scheme, secretly using new investor funds to make payments to older investors. This gave them the false impression that their "investments" were yielding profits, thereby lulling them into a false sense of security and encouraging them to make more fraudulent investments.  

He used excess money from his scheme to fund his lavish lifestyle, which included for a private jet service, luxury vehicles, high-end dining, and suites at NFL games.

He preyed on more than two dozen victims and fraudulently obtained at least $1.4 million, inducing multiple fraudulent transfers from investor accounts into accounts associated with his businesses, MCC Holdings, SLJ Holdings, and STR America Holdings.

Mr. Carroll is currently incarcerated at the federal correctional institution in Seagoville, TX.

[M]ulder misrepresented himself as worth millions to friends. Mulder told several individuals that a wealthy Missouri widow had left him over $100 million in a blind trust in appreciation for his services as an insurance salesman for the widow. In another story, he said he was the beneficiary of a different blind trust worth hundreds of millions of dollars from his father. Mulder convinced his friends that if they pooled their investments with his fortune, they could grow their money faster. The government asserted there were no investments made by Mulder on their behalf but instead, Mulder deposited checks into his personal bank accounts and used the funds to pay off credit card debts and to run a coffee shop chain.

To cover his tracks, Mulder created a web of convoluted rules and restrictions to keep the victims from seeing the progress of their investments. He also moved money between more than 60 bank accounts to make it difficult for the investors and law enforcement to follow the trail of money.

In his plea agreement, Mulder specifically admitted that beginning in 2000 and continuing through 2017, he received numerous checks totaling approximately $4.5 million from the investor, who was a local businessman and friend to Mulder. Mulder advised the victim to create a trust for his special needs son for which Mulder would be the trustee and have complete discretion and control. Mulder told the victim that he would prudently invest the funds on the son's behalf. Instead, Mulder used the funds for his own personal expenses and to enrich himself.

Mulder also admitted that in December 2015, he fraudulently received a check from the victim in the amount of $142,500 and deposited funds from the check in the amount of $83,378.54 into his personal account, which he later used on a personal investment in generators in Missouri.

Further, Mulder admitted that he lied about his assets and submitted fabricated documents to obtain loans from Oklahoma banks in order to support a lifestyle he couldn't afford on his own.

Prosecutors contended that Mulder applied for and received loans worth millions of dollars from five banks. From 2004 to 2014, Mulder obtained the loans by pledging phony collateral that included fictitious life insurance policies supposedly issued by Merrill Lynch that appeared to insure Mulder and his family members. Mulder used the same phony policy numbers with every new bank he swindled, adding new phony policies as he went. To secure each loan, he provided the banks with the same types of fabricated records and documents. On some of the documents, Mulder forged the signature of a former Merrill Lynch colleague. Mulder was able to pay off three of the banks by obtaining new loans from other banks. Ultimately, two banks- Firstbank and BancFirst- suffered about $3.9 million in losses.

Prosecutors asserted that Mulder further tried to impede the federal investigation into his criminal conduct by fabricating a story blaming one of his bankers for creating the fictitious life insurance policies in Mulder's and his family members' names. Agents debunked the claim based on the evidence that Mulder began his scheme long before he ever met the accused banker.

From 2013 through 2019, Phelps and his conspirators carried out a scheme to defraud Phelps' employer, a bank. They obtained millions of dollars of credit from the bank for Starnet Business Solutions Inc. a now defunct New Jersey-based printing company where Phelps' conspirators worked. Phelps' conspirators paid him large cash bribes in connection with the fraud scheme

In 2013, Starnet received a line of credit from the bank after providing materially false financial information. The bank not only allowed Starnet to maintain the line of credit, at various times it increased the line of credit. By 2018, the line of credit was worth approximately $8 million, and Starnet has not repaid it

Phelps was aware that financial information Starnet provided to the bank for the line of credit was materially false, and coached Starnet on how to defraud the bank. Phelps would review draft financial information for Starnet and provide feedback on how his conspirators should falsify the information before submission. Phelps also worked to ensure that the bank did not detect the fraud scheme by helping Starnet avoid audits and other quality control measures employed by the bank. 

Phelps solicited large cash bribes - tens of thousands of dollars at a time - from Starnet in connection with the fraud scheme. Phelps' conspirators pooled cash to pay Phelps bribe payments. Over the course of the conspiracy, Phelps accepted hundreds of thousands of dollars in cash bribes. 

Vo used Paxful and LocalBitcoins to buy and sell Bitcoin - websites where people can buy and sell cryptocurrencies. He profited from sales by collecting a percentage of the transactions which ranged from 5-30%. During the transactions, Vo did not ask clients for any form of identification nor the purpose for which they were purchasing the cryptocurrency.

Vo received funds in the form of cash, direct bank deposits, American Express credit cards as well as Amazon and generic gift cards. He used several bank accounts to conduct his business, but the banks shut down the accounts after inquiring about the origination of the funds.

During the course of three months, the unlicensed money transmitting business received and transmitted approximately $515,147.19 in Bitcoin.

The perpetrators of the romance scams created several profiles on online dating sites and then contacted men and women throughout the United States and elsewhere. The scammers cultivated a sense of affection and, often, romance, with the victims they met online before requesting money for investment or need-based reasons. The romance scam perpetrators then provided victims with bank account information where the money should be sent. Nyamekye controlled one of these accounts and received more than $1.3 million in romance fraud proceeds from victims. 

The government proved beyond a reasonable doubt at trial that Nyamekye laundered the victims' money on behalf of the conspiracy. The defendant conspired with others from at least June 2016 until February 2018 to commit money laundering in multiple transactions of more than $10,000 with the purpose of concealing the fraudulent nature of the proceeds. 

At least eight victims sent their money directly to Nyamekye's bank account, which was in the name of Gloseth Ventures LLC. For example, one victim was defrauded by a purported member of the military and sent a $170,000 wire transfer to Nyamekye's bank account. Another victim fell in love with a man he met online who also claimed to be in the military overseas and sent two wire transfers to Nyamekye totaling $73,000. A separate victim believed she was engaged to the man who was scamming her and sent $50,000 to the defendant's bank account. 

After the funds were deposited into Nyamekye's bank account, Nyamekye took a cut of the victims' money and then conducted financial transactions to move the funds where the perpetrators of the romance fraud could enjoy the criminal proceeds. 

[F]rom approximately July 2017 to around December 2017, Gemini, directly and through others, made false or misleading statements of material facts, or omitted to state material facts, to the CFTC during an evaluation of the potential self-certification of a bitcoin futures contract by a designated contract market (DCM). The proposed bitcoin futures contract was to be settled by reference to the spot bitcoin price on the relevant day as determined by an auction held on Gemini's digital asset trading platform (Gemini Bitcoin Auction). 

According to the complaint, Gemini, directly and through the DCM, provided information to the CFTC concerning Gemini's trading platform and the Gemini Bitcoin Auction, and certain statements and information conveyed or omitted by Gemini were false or misleading with respect to, among other things, facts relevant to understanding whether the proposed Bitcoin Futures Contract would be readily susceptible to manipulation. As alleged in the complaint, Gemini personnel knew or reasonably should have known that such statements were false or misleading.

In performing its market oversight responsibilities, the Commission and its staff must be able to rely on information submitted by market participants to the Commission and its staff. Here, as the complaint alleges, the proposed Bitcoin Futures Contract was significant because it was to be among the first digital asset futures contracts listed on a designated contract market, and information provided directly and indirectly by Gemini to the CFTC was important to the CFTC's work as it sought to fulfill its statutory mission, including ensuring financial integrity of transactions subject to the CEA, protecting market participants, deterring and preventing price manipulation and any other disruptions to market integrity, and promoting responsible innovation.

According to the SEC's order, the resolution with Tenaris is the result of an alleged bribe scheme involving agents and employees of its Brazilian subsidiary to obtain and retain business from the Brazil state-owned entity Petrobras. Specifically, the order finds that between 2008 and 2013, approximately $10.4 million in bribes was paid to a Brazilian government official in connection with the bidding process at Petrobras. The bribes were funded on behalf of Tenaris' Brazilian subsidiary by companies affiliated with Tenaris' controlling shareholder.

. . .

This is not the first time Tenaris has been involved in a corruption scheme. In 2011, the company entered into a Non-Prosecution Agreement with the Department of Justice and a Deferred Prosecution Agreement with the SEC as a result of alleged bribes the company paid to obtain business from a state-owned entity in Uzbekistan. 

in connection with Campbell's misappropriation of client funds between February 2019 and May 2021.

[C]ampbell misused her access to client accounts to modify account settings, which then allowed her to misappropriate funds from client accounts through fraudulent checks and wire transfers. According to the complaint, Campbell also executed unauthorized securities transactions to generate cash that she then misappropriated. The complaint further alleges that Campbell went to great lengths to avoid detection, including creating fake documents, hacking into her colleagues' email accounts, and even using voice-altering software to impersonate her colleague on the phone. As alleged in the complaint, in total, Campbell misappropriated approximately $483,000 from a number of client accounts, including those related to elderly individuals and deceased individuals who had left assets in trusts.

[S]humake, alongside Jackson, conducted a fraudulent and unregistered crowdfunding offering through 420 Real Estate, a hemp company, on TruCrowd, Inc., a registered crowdfunding portal. The complaint also alleged that Shumake and Jackson raised $888,180 from retail investors through 420 Real Estate. According to the complaint, Shumake, with assistance from Jackson, hid his involvement in the offering from the public out of concern that his prior criminal conviction could deter prospective investors. In addition, Shumake and Jackson allegedly diverted investor funds for personal use rather than using the funds for the purposes disclosed to investors. On January 28, 2022 the Court entered bifurcated judgments against Jackson and 420 Real Estate.

[T]he alleged scheme conducted by Sirotka, along with two other senior executives previously charged by the Commission in July 2021, inflated the company's revenues for certain periods by as much as 108 percent.

According to the SEC's complaint, Anthony Sirotka helped FTE's former CEO, Michael Palleschi, and CFO, David Lethem, inflate FTE's revenue by directing the then-NYSE listed public company to improperly recognize revenue and related accounts receivable for nonexistent construction projects. The complaint also alleges that Sirotka, Palleschi and Lethem misled FTE's auditor about approximately $12.5 million in fictitious revenue and related accounts receivable, by, among other things, doctoring and forging documents and signatures in materials provided to the auditor.

The Securities and Exchange Commission today charged the town of Sterlington, Louisiana and its former mayor, Vern A. Breland, as well as the town's unregistered municipal advisor, Twin Spires Financial LLC, and its owner, Aaron B. Fletcher, with misleading investors in the sale of $5.8 million in municipal bonds across two offerings in 2017 and 2018.

According to the SEC's complaints, the town of Sterlington issued the revenue bonds to finance the development of a water system and improvements to its existing sewer system. As required by state law, Sterlington applied to the Louisiana State Bond Commission (SBC) for approval of the two offerings. The SEC alleges that Sterlington submitted false financial projections, created by Fletcher and Twin Spires, with then-Mayor Breland's active participation and approval, substantially overstating the number of historical and projected sewer customers in order to mislead the SBC as to the town's ability to cover the debt service for the proposed bonds. The town and Breland allegedly did not disclose to investors that SBC approval of the bonds was based on the false projections or that Breland had directed the misuse of more than $3 million from earlier bond offerings intended for sewer system updates to instead pay for sports complex improvements, town legal fees, and payroll. The SEC further alleges that Twin Spires and Fletcher provided municipal advisory services to Sterlington without Twin Spires being registered as a municipal advisor with the Commission. vigorously pursue advisors who continue to flout those requirements."

The SEC's complaint, filed on December 3, 2021 in federal district court in Los Angeles, alleged that Pithapurwala unlawfully tipped his brother-in-law, Ammar Kutiyanawalla, who purchased Snap options on the basis of material nonpublic information ahead of the company's February 6, 2018 earnings announcement. As alleged in the complaint, Pithapurwala and Alifiya funded Ammar's Snap trading by transferring $20,000 to Ammar through intermediaries, and Ammar and Pithapurwala agreed to share the profits. The SEC charged Alifiya, who is Ammar's sister, with aiding and abetting the insider trading.

Pithapurwala and Alifiya consented to the entry of a judgment permanently enjoining them from violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Pithapurwala agreed to pay a civil penalty of $523,031, and Alifiya agreed to pay a civil penalty of $75,000.

[F]rom August 10, 2016 through August 13, 2020, iFresh failed to properly disclose numerous transactions with entities related to Deng and his brother. The complaint alleges that iFresh's financial statements were allegedly materially misstated in 2016, 2017, 2018, 2019, and 2020. As alleged in the complaint, between 2017 and 2020, from 18% to 54% of iFresh's accounts receivable were from undisclosed related party transactions. The complaint further alleges that between 2016 and 2020, iFresh failed to disclose over $12 million in payments to a company owned by Deng's brother. Finally, the complaint alleges that by misrepresenting information about iFresh's related party transactions, iFresh deprived investors of the true scope of iFresh and Deng's intertwined business interests.

The SEC initially charged Henderson and GRL in September 2019, and, after learning of additional securities law violations by Henderson and GRL, filed an amended complaint on December 3, 2020. The SEC's amended complaint alleged that between December 2016 and June 2017, Henderson and GRL conducted two unregistered and fraudulent securities offerings, telling investors their funds would be used to obtain financial instruments necessary to broker Nigerian crude oil transactions, from which significant investor profits would be generated and paid in short periods of time. In fact, as set out in the amended complaint, Henderson spent nearly all of the $60,000 raised on his personal expenses and vacations.

On March 17, 2022, the Court granted the SEC's motion for summary judgment on all of its claims against Henderson, finding that Henderson's offers and sales of securities were "based on knowing lies as a part of a fraudulent scheme to obtain money that Henderson immediately used on himself not to obtain financing instruments to facilitate crude oil transactions as he claimed." On May 26, 2022, the Court entered a final judgment permanently enjoining Henderson and GRL from violating Sections 5 and 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and permanently enjoining both from participating in the issuance, purchase, offer, or sale of any security, except for purchasing or selling securities for Henderson's own personal accounts. The Court also ordered Henderson and GRL to pay, on a joint and several basis, $50,000 in disgorgement of ill-gotten gains plus $10,997 in prejudgment interest thereon. Henderson was also ordered to pay a civil penalty of $103,591.

Solomon was most recently the General Counsel and Chief Compliance Officer for Rockefeller Financial LLC.  Prior to joining Rockefeller, Mr. Solomon spent seven years as the Senior Vice President and Northeast Regional Director for FINRA, where he had responsibility for the Examination and Surveillance Programs in the region and oversaw a staff of 350 people in FINRA's five northeast offices. Prior to his tenure at FINRA, he had senior legal and compliance roles at several global financial services firms, including Jefferies, UBS and Merrill Lynch. Michael was also a trial counsel in the NYSE Enforcement Division and began his legal career as an assistant district attorney in Manhattan where he investigated and prosecuted violent street crime, narcotics trafficking, fraud, and organized crime.

Merrill Lynch maintained an automated system designed to restrict a customer's purchase of Class C shares when lower cost Class A shares were available. The system, however, often failed to correctly identify and implement applicable purchase limits on Class C shares. As a result, thousands of Merrill Lynch customers purchased Class C shares, incurring fees and charges, when Class A shares were available at a substantially lower cost.

For example, in November 2019, the firm's system failed to flag a customer's purchase of Class C shares with annualized expenses of approximately 1.76 percent when the customer could have purchased Class A shares with lower annualized expenses of approximately 0.96 percent without paying a sales charge.

. . .

In addition to providing restitution to harmed customers, Merrill Lynch has agreed to convert certain customers' existing Class C holdings to Class A shares, where appropriate. FINRA did not impose a fine due to the firm's extraordinary cooperation and substantial assistance with the investigation. Merrill Lynch voluntarily and proactively conducted an internal review, engaged an outside consultant to identify affected customers and calculate remediation, and established a remediation plan to repay customers and convert shares, where applicable.

• Securities Industry Commentator
• Bill Singer