Financial Enforcement Actions | Week of August 07 to August 13

Penalties: N/A
Respondent: Illumina Inc. & Grail Inc.
Violation: Pursuant to Rule 3.45 of the Federal Trade Commission’s Rules of Practices, non-party Thermo Fisher Scientific Inc. (“Thermo Fisher”) respectfully moves this Court for in camera treatment, in whole or in part, of seventeen confidential, competitively sensitive documents and testimony identified in Exhibit B hereto (“Confidential Materials”)… Read More

Penalties: N/A
Respondent: Traffic Jam Events LLC. & David J. Jeansonne II
Violation: On July 26, 2021, Federal Trade Commission (“FTC” or “Commission”) Complaint Counsel filed a Motion to Determine the Sufficiency of Respondents’ Responses to Requests for Admission (“Motion”). Respondents Traffic Jam Events, LLC (“TJE”) and its president, David J. Jeansonne II (“Jeansonne”) filed an opposition to the Motion on July 30, 2021 (“Opposition”)… Read More

Penalties: N/A
Respondent: Ronald Clarke & FleetCor Technologies Inc.
Violation: FleetCor has enticed businesses to sign up for its fuel cards by making three main claims: that customers will save money; that the cards provide fraud controls that protect customers from unauthorized transactions; and that the cards have no set-up, transaction, or membership fees, including when used to purchase fuel at any of the thousands of locations nationwide that accept FleetCor fuel cards. Each of these claims is false or unsubstantiated… Read More

Penalties: N/A
Respondent: Patent Office Professional Association
Violation: The union failed to comply with a candidate’s reasonable request to distribute campaign literature at the candidate’s expense, in violation of Section 401(c) of the LMRDA, which is made applicable to federal sector unions by the CSRA… Read More

Penalties: $95,200.00
Respondent: Brenda Walters
Violation: On March 24, 2021, Walters pleaded guilty to one count of embezzlement of union funds, in violation of 29 U.S.C. 501(c). The sentencing follows an investigation by the OLMS Dallas-New Orleans District Office… Read More

Penalties: N/A
Respondent: Jorge Antonio Netto
Violation: Netto failed to disclose any of these activities to Mora WM prior to engaging in them. In addition, during January 2018, Netto submitted an annual compliance certification to Mora WM in which Netto falsely certified that he had notified Mora WM’s Compliance Department of all outside business activities when, in fact, he failed to identify his ownership of and management role with two limited liability companies related to the Sacramento Property transaction—the Delaware LLC and the Florida LLC. By reason of the foregoing, Netto violated FINRA Rule 2010… Read More

Penalties: $5,000.00
Respondent: Alexander Noda
Violation: In April 2020, while associated with Merrill Lynch, Respondent created a fictitious auto loan pre-approval letter for himself and his wife using the letterhead of the firm’s banking affiliate (the “Bank”). Respondent submitted the letter to a car dealership and requested that the dealership offer him and his wife the same financing terms contained in the fictitious letter, for the purchase of a new car, as part of the dealership’s practice of matching competitors’ offers. As a result, Respondent violated FINRA Rule 2010… Read More

Penalties: $279,122.00
Respondent: John S. Cangialosi
Violation: From October 2014 through December 2018, while registered through Legend and then WCM, Cangialosi excessively traded three customers’ accounts in violation of FINRA Rules 2111 and 2010… Read More

Penalties: $5,000.00
Respondent: Suheydee Sonera Arce
Violation: From August 2017 to November 2018, on at least eight occasions, Sonera used a presigned Letter of Authorization (LOA) from a customer to effect regular distributions to the customer. By this conduct, Sonera violated FINRA Rule 2010. In addition, Sonera violated FINRA Rules 4511 and 2010 by causing Popular to create and maintain inaccurate books and records in violation of Section 17(a) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 17a-3 thereunder… Read More

Penalties: N/A
Respondent: Alexis Cooke
Violation: Cooke falsified the two fixed annuity applications by untruthfully stating in the applications that she had met with the customers, witnessed their signatures, and verified their respective identities. Finally, Cooke failed to respond truthfully to FINRA staff’s questions during testimony. Based on the foregoing, Cooke violated FINRA Rules 2010, 4511, and 8210… Read More

Penalties: $7,500.00
Respondent: Nancy A. Munro Gaumer
Violation: Between August 2012 and September 2017, Signator’s procedures regarding conflicts of interest with customers prohibited registered representatives from maintaining joint accounts with customers who are not immediate family or accepting powers of attorney (POAs) for customers who are not immediate family. Gaumer circumvented those procedures, submitting inaccurate information to the firm, which omitted that activity, in violation of FINRA Rule 2010… Read More

Penalties: $5,000.00
Respondent: Jason L. Seale III
Violation: From February 2016 through December 2018, while associated with American Wealth Management, Seale effected more than 60 trades in four customer accounts using discretion without the customers’ prior written authorization and without the firm accepting these accounts as discretionary in writing. Based on the foregoing, Seale violated NASD Rule 2510(b) and FINRA Rule 2010… Read More

Penalties: N/A
Respondent: Thomas W. Stratton
Violation: Stratton refused to provide information and documents requested by FINRA pursuant to FINRA Rule 8210, in violation of FINRA Rules 8210 and 2010… Read More

Penalties: $5,000.00
Respondent: Henry Bones II
Violation: From November 2016 to December 2018, Bones, as the manager of a WCM branch, failed to reasonably supervise a former registered representative (Representative 1) that excessively traded ten customer accounts. Bones was aware of multiple red flags of excessive trading, including high cost-to-equity ratios and high turnover rates in Representative 1’s customer accounts. Bones did not reasonably investigate those red flags or otherwise take meaningful action to stop the misconduct. As a result, Bones violated FINRA Rules 3110 and 2010… Read More

Penalties: $5,000.00
Respondent: Eneida Vega Cortes
Violation: From August 2011 to June 2012, on at least four occasions, Vega reused a Letter of Authorization (LOA) signed by another Popular employee to effect the transfer of securities from Popular’s trust department brokerage account to a client’s trust account. By this conduct, Vega violated FINRA Rule 2010. In addition, Vega violated FINRA Rules 4511 and 2010 by causing Popular to create and maintain inaccurate books and records in violation of Section 17(a) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 17a-3 thereunder… Read More

Penalties: $5,000.00
Respondent: Sandeep Jain
Violation: In August 2019, Jain accessed a third-party internet-based platform on his UBS-issued computer and enabled a file-sharing feature which resulted in the transfer of more than 100 files containing UBS’s confidential information to the third-party platform. By doing so, Jain circumvented the firm’s written policies and procedures concerning the protection of confidential information. By virtue of this conduct, Jain violated FINRA Rule 2010… Read More

Penalties: $237,383.00
Respondent: Ahmad Haris Tajyar; Eric Leo Marsoubian
Violation: According to the SEC’s complaint, filed in the United States District Court for the Central District of California, from February through November 2017, Tajyar engaged in manipulative trading in the stock of Atlas Technology International, Inc. (“Atlas”), including wash sales, matched orders, and marking the close. From September through November 2017, Tajyar allegedly engaged in a fraudulent campaign to promote Atlas stock in order to manipulate the price and trading volume of the stock… Read More

Penalties: N/A
Respondent: Johanna M. Garcia & MJ Capital Funding, LLC; MJ Taxes and More, Inc
Violation: According to the SEC’s complaint, which was filed in federal court in the Southern District of Florida, since about June 2020, Garcia and her companies raised at least $70 million from more than 2,150 investors in a fraudulent securities offering… Read More

Penalties: N/A
Respondent: David P. Ortiz
Violation: The Commission’s complaint alleged that, from no later than July 2017 until July 2018, Ortiz offered and sold the securities of 1 Global, a merchant cash advance company based in Hallandale Beach, Florida, in unregistered transactions. The complaint alleged Ortiz offered and sold 1 Global’s securities to his advisory clients and other individuals via various means, including emails, telephone calls, and in-person meetings, while not registered as a brokerdealer or associated with a registered broker-dealer… Read More

Penalties: N/A
Respondent: Martin A. Ruiz & Carter Bain Wealth Management, LLC; RAM Fund, LP
Violation: Ruiz misappropriated the vast majority of the investors’ funds to support his lavish lifestyle by, among other things, paying for his residences in Manhattan and Santa Fe, covering millions of dollars in credit cards bills, and making student loan payments… Read More

Penalties: N/A
Respondent: Gordon Scott Venters & The Movie Studio, Inc
Violation: The complaint alleges that The Movie Studio falsely made itself appear more successful than it really was… Read More

Penalties: $716,345.29
Respondent: ISC Advisors Inc.
Violation: ISCA failed to provide full and fair disclosure of these payments and the resulting conflicts of interest. ISCA also violated its duty to seek best execution for certain transactions by selecting or recommending certain mutual fund share classes when share classes of the same funds were available to its clients that presented a more favorable value for these clients at the time of the transactions. In addition, ISCA failed to adopt and implement written compliance policies and procedures reasonably designed to prevent violations of the Advisers Act and the rules thereunder in connection with its mutual fund share class selection practices and revenue sharing from its clearing broker on clients’ assets held in cash or cash sweep programs, and the disclosure of these practices and payments and the resulting conflicts of interest. ISCA, although eligible to do so, did not self-report to the Commission pursuant to the Division of Enforcement’s Share Class Selection Disclosure Initiative. ISCA has advised the Commission staff that after the commencement of the Commission’s investigation, it reimbursed approximately $331,000 in 12b-1 fees, plus interest, to clients, began rebating 12b-1 fees to client accounts, and converted client investments to the available share class most favorable to ISCA’s clients… Read More

Penalties: N/A
Respondent: Edgar M. Radjabli
Violation: Radjabli engaged in three fraudulent courses of conduct involving the offering of and transactions in securities, as well as offering registration and unlawful tender offer practice violations, between 2018 and 2020, as follows… Read More

Penalties: N/A
Respondent: Frederick L. Sharp; Mike K. Veldhuis; Paul Sexton; Jackson T. Friesen; Zhiying Yvonne Gasarch; Courtney Kelln
Violation: Canadian resident Frederick L. Sharp masterminded a complex scheme from 2011 to 2019 in which he and his associates – Canadian residents Zhiying Yvonne Gasarch and Courtney Kelln – enabled control persons of microcap companies whose stock was publicly traded in the U.S. securities markets to conceal their control and ownership of huge amounts of penny stock… Read More

Penalties: N/A
Respondent: Erik Christian Jones
Violation: The Commission’s complaint alleged that, among other things, Respondent sold unregistered securities and sold securities without being registered with the Commission as a broker or being associated with any entity that was so registered as a broker… Read More

Penalties: N/A
Respondent: Blessing K. Egbon
Violation: Egbon allegedly provided the investors with fictitious revenue and profit figures and forged bank statements showing that Exit 7C was a profitable, growing company, when in fact the company had never made a profit. In addition, shortly after receiving the investors’ funds, Egbon allegedly began misappropriating the money and spending it on various personal expenses, including visits to nightclubs, chartered jets, villa rentals, and tickets to sporting events. According to the complaint, Egbon misappropriated approximately $2.15 million from Exit 7C’s investors… Read More

Penalties: $40,997.26
Respondent: Zorayr Mikael Manukyan-Zakaryan
Violation: This matter involves insider trading by Manukyan-Zakaryan in the stock of AveXis, Inc. (“AveXis”) ahead of an April 9, 2018 announcement that AveXis had agreed to be acquired by Novartis AG (“Novartis”)… Read More

Penalties: $20,000.00
Respondent: Gary S. Klein
Violation: From the fourth quarter of 2016 through his departure from the Company on August 31, 2017 (the “Relevant Period”), Gary S. Klein, the former Chief Financial Officer (“CFO”) of Sequential Brands Group, Inc. (“Sequential” or the “Company”), caused Sequential to file materially inaccurate disclosures in its current and periodic reports and to maintain inaccurate books and records regarding goodwill… Read More

Penalties: $117,849.35
Respondent: David Webb, Jr
Violation: Webb engaged in a pay-to-play scheme by soliciting and receiving a $75,000 bribe from a construction contractor… Read More

Penalties: N/A
Respondent: Luis Jimenez Carrillo; Amar Bahadoorsingh; Justin Roger Wall; Jamie Samuel Wilson
Violation: From at least 2013 through May 2019, Carrillo concealed the fact that he and others controlled the securities of numerous microcap companies whose stock was publicly traded in the U.S. securities markets… Read More

Penalties: N/A
Respondent: Evarist C. Amah
Violation: The SEC’s complaint alleges that, from April 2016 to July 2019, Amah raised approximately $700,000 from his advisory clients using materially false and misleading statements about his investment performance, telling them that he had generated modest returns on their investments when, in reality, he had already lost virtually all of their money. According to the complaint, Amah also fabricated at least two performance statements to perpetuate his fraudulent scheme and conceal his misconduct. Amah also allegedly violated the fiduciary duties he owed to his individual clients by favoring another client, a fund, over them, using the individual clients’ assets to pay expenses owed by the fund… Read More

Penalties: $10,388,309.10
Respondent: Poloniex, LLC
Violation: During the Relevant Period, Poloniex was not registered with the Commission as a national securities exchange nor did it operate pursuant to any exemption from registration. As a result, Poloniex violated Section 5 of the Exchange Act… Read More

Penalties: $68,360.00
Respondent: Leonard R. Barr
Violation: According to the SEC’s complaint, filed in the U.S. District Court for the Eastern District of Michigan, Barr used confidential financial data he obtained through his role as an accountant at Domino’s to trade ahead of two Domino’s earnings announcements in 2016 and 2020 and obtained illicit profits of $34,180… Read More

Click here to see the full list of SEC Enforcement Documents

Penalties: $1,500,000.00
Respondent: Tyson Foods Inc.
Violation: Tyson thereby violated Section 4a(b) of the Act, 7 U.S.C. § 6a(b) (2018), and Former Regulation 150.2. In all but two months from at least January 2016 through August 2020, Tyson filed with the Commission incorrect Form 204 Statements of Cash Positions in Grain by reporting the approximate number of open futures contracts it was using to hedge anticipated unfilled requirements in soybean meal and corn… Read More

Penalties: $100,000,000.00
Respondent: Arthur Hayes; Benjamin Delo; Samuel Reed & HDR Global Trading Limited (“HDR”); 100x Holdings Limited (100x”); ABS Global Trading Limited (“ABS”); Shine Effort Inc Limited (“Shine”); HDR Global Services (Bermuda) Limited (“HDR Services”)
Violation: Settling Defendants HDR, 100x, ABS, Shine, and HDR Services, all acting as a common enterprise and doing business as BitMEX, offered to enter into, entered into, executed or confirmed the execution of transactions involving commodities for future delivery on its platform that was not designated as a contract market and thus violated Section 4(a) of the Act, 7 U.S.C. § 6(a) (2018)… Read More

Penalties: $1,389,550.00
Respondent: Mayco Alexis Maldonado Garcia et al. d/b/a Global Trading Club
Violation: Maldonado intentionally or recklessly used or employed manipulative or deceptive devices or contrivances, in connection with contracts of sale of a commodity in interstate commerce, including: a. Misrepresenting that GTC employed “over 75 master traders” who had years of trading experience… Read More

Penalties: $1,389,550.00
Respondent: Mayco Alexis Maldonado Garcia et al d/b/a Global Trading Club
Violation: During the Relevant Period, Maldonado intentionally or recklessly used or employed manipulative or deceptive devices or contrivances, in connection with contracts of sale of a commodity in interstate commerce, including: a. Misrepresenting that GTC employed “over 75 master traders” who had years of trading experience… Read More