Financial Enforcement Actions | Week of July 10 to July 16

Penalties: N/A
Respondent: Eaton Corporation PLC; Danfoss A/S
Violation: Danfoss’s proposed acquisition of Eaton’s hydraulics business likely would substantially lessen competition in the design, manufacture, and sale of orbital motors and steering units for mobile off-road equipment in the United States in violation of Section 7 of the Clayton Act, 15 U.S.C. § 18… Read More

Penalties: $5,000.00
Respondent: Christian M. Evans
Violation: Between July 2018 and August 2019, Respondent engaged in an outside business activity without providing prior written notice to the firm, in violation of FINRA Rules 3270 and 2010… Read More

Penalties: $250,000.00
Respondent: StockCross Financial Services, Inc; Muriel Siebert & Co., Inc
Violation: Between July 2009 and December 2019, StockCross had no reasonable surveillance system to review solicited transactions for excessive trading and suitability. StockCross delegated trade surveillance to certain principals but took no steps to determine whether these designated principals were in fact reviewing solicited transactions for suitability and excessive trading, which they were not… Read More

Penalties: $590,000.00
Respondent: James C. Snow, JR.; Lyle Wesley Davis; Byron Bert Barkley; Craig Stanton Norton & Wilson-Davis & Co., Inc.
Violation: These same “Designated Supervisors” failed to reasonably supervise registered representative and market maker Craig Stanton Norton’s trading in NuGene International, Inc. (ticker, “NUGN”) stock by ignoring various “red flags” of potentially suspicious or manipulative trading set forth in the firm’s WSPs, which also failed to establish how the firm’s trading activity should be supervised to detect and prevent such trading… Read More

Penalties: $1,515,000.00
Respondent: John Coolong & Laidlaw & Company (UK) Ltd
Violation: From at least January 2015 through September 2015, Laidlaw failed to establish, maintain, and enforce a supervisory system, including written supervisory procedures, reasonably designed to achieve compliance with federal securities laws and FINRA rules prohibiting market manipulation… Read More

Penalties: $750,000.00
Respondent: NEXT Financial Group, Inc
Violation: From January 2012 through February 2019, NEXT failed to establish, maintain, and enforce a supervisory system, including written supervisory procedures (WSPs), reasonably designed to detect and prevent unsuitable short-term trading of mutual funds and municipal bonds in customer accounts and over-concentration of customer accounts in Puerto Rican municipal bonds… Read More

Penalties: $3,250,000.00
Respondent: GreenSky, LLC
Violation: The Consumer Financial Protection Bureau (Bureau) has reviewed certain origination and servicing activities of GreenSky, LLC (Respondent, as defined below) and has identified the following law violations: (1) Respondent engaged in unfair acts and practices with regard to loans to consumers who did not authorize them in violation of §§ 1031(a) and 1036(a)(1)(B) of the CFPA, 12 U.S.C. §§ 5531(a) and 5536(a)(1)(B); and (2) Respondent engaged in unfair acts and practices by structuring its loan origination and servicing activities in a manner that enabled unauthorized loans in violation of §§ 1031(a) and 1036(a)(1)(B) of the CFPA, 12 U.S.C. §§ 5531(a) and 5536(a)(1)(B)… Read More

Penalties: $10,203,738.00
Respondent: Joseph Carney; Sean Carney; Raymond Carney & Environmental Safety International INC. d/b/a Environmental Products International Inc.
Violation: The Complaint alleges that Defendants engaged in or assisted and facilitated engaging in acts or practices in violation of the FTC’s Telemarketing Sales Rule (“TSR”), as amended, 16 C.F.R. Part 310, by initiating or causing others to initiate, in connection with Telemarketing, (a) telephone calls to telephone numbers listed on the National Do Not Call Registry; (b) telephone calls that delivered a prerecorded message; (c) telephone calls to persons who previously have stated that they do not wish to receive a call; and (d) outbound telephone calls that fail to properly disclose the identity of the seller and that the purpose of the call is to sell goods or services… Read More

Penalties: $18,000,000.00
Respondent: LendingClub Corporation, d/b/a Lending Club
Violation: The Complaint charges that Defendant participated in deceptive and unfair acts or practices in violation of Section 5 of the FTC Act, 15 U.S.C. § 45. The Complaint seeks both permanent injunctive relief and equitable monetary relief for the Defendant’s alleged deceptive or unfair acts or practices as alleged therein… Read More

Penalties: $9,000,000.00
Respondent: S&P Dow Jones Indices LLC
Violation: On May 17, 2021, the Commission issued an Order Instituting Cease-and-Desist Proceedings, Pursuant to Section 8A of the Securities Act of 1933, Making Findings, and Imposing a Cease-and-Desist Order (the “Order”) against S&P Dow Jones Indices LLC (“S&P” or the “Respondent”)… Read More

Penalties: $603,776.82
Respondent: Securities America Advisors, Inc
Violation: On November 13, 2020, the Commission issued an Order Instituting Administrative and Cease-and-Desist Proceedings, Pursuant to Sections 203(e) and 203(k) of the Investment Advisers Act of 1940, Making Findings, and Imposing Remedial Sanctions and a Cease-andDesist Order (the “Order”) against Securities America Advisors, Inc. (“SAA” or the “Respondent”)… Read More

Penalties: N/A
Respondent: John Clifford Park
Violation: The SDDI alleged that, over a period of years, Park signed his customers’ names on numerous insurance documents in violation of S.D. Codified Laws §§ 58- 30-167(7), (8) and (10), a state statute prohibiting fraud and forgery by insurance agents… Read More

Penalties: N/A
Respondent: Jefferey A. Gordon & Blue Rock Ventures, LLC; Windy City Accelerated Returns Venture I, LLC
Violation: The SEC’s complaint alleges that Gordon sold investors interests in his company, Windy City Accelerated Returns Venture I, LLC, which he claimed would use investor funds to acquire stakes in other companies that operated lucrative rental properties near Chicago, Illinois… Read More

Penalties: N/A
Respondent: Marlon Muller
Violation: The SEC’s complaint, filed in the United States District Court for the Southern District of New York, alleges that, using an internet chat application, Muller repeatedly instructed an associate when and how to submit buy and sell orders for EMSF shares, using several brokerage accounts the associate controlled at multiple brokerdealers, in order to reach the price and liquidity levels Muller wanted… Read More

Penalties: N/A
Respondent: David Aaron Rockwell
Violation: In connection with his plea, Rockwell admitted that beginning in October 2017, Rockwell began to convert and misappropriate monies belonging to his clients. Specifically, he applied for and obtained two lines of credit at a bank in the total amount of $700,000 in his clients’ names without their knowledge or permission, using his clients’ assets as collateral… Read More

Penalties: N/A
Respondent: Michael Palleschi; David Lethem
Violation: According to the SEC’s complaint, Michael Palleschi and David Lethem, the former CEO and CFO, respectively, of FTE, directed the company to issue approximately $22.7 million in convertible notes with short-term maturities, steep interest rates, and market-price-based formulas for conversion into shares… Read More

Penalties: $201,687.99
Respondent: Blotics Ltd. f/d/b/a CoinSchedule Ltd.
Violation: The digital tokens publicized by Coinschedule included those that were offered and sold as investment contracts, which are securities pursuant to Section 2(a)(1) of the Securities Act. Digital token issuers from the United States and other nations paid Coinschedule to profile their token offerings on the platform, but Coinschedule never disclosed to its platform visitors that it received compensation for doing so… Read More

Penalties: $125,000.00
Respondent: Cascade Investment Group Inc.
Violation: These proceedings arise out of breaches of fiduciary duty by Cascade, a dually registered investment adviser and broker-dealer, in connection with its mutual fund share class selection practices… Read More

Penalties: N/A
Respondent: Shimon Rosenfeld
Violation: According to the SEC’s complaint, between May 2014 and March 2018, Rosenfeld solicited at least five investors by promising them that he would pool their funds to purchase and then resell real estate for a profit, which he would then split with the investors… Read More

Penalties: N/A
Respondent: Jonathan Mimun a/k/a Jonathan Maymon; Ronn BenHarav
Violation: According to the SEC’s complaint, defendants owned and ran JMRB Media, Ltd., an Israeli company that operated “boiler rooms” where salespersons used lies, tricks, and high-pressure sales tactics to offer and sell binary options under the brand names Porter Finance and Dalton Finance… Read More

Penalties: N/A
Respondent: Paul L. Chancey Jr.
Violation: Paul L. Chancey, Jr., a certified public accountant (“CPA”), engaged in improper professional conduct, within the meaning of Section 4C of the Exchange Act and Rule 102(e) of the Commission’s Rules of Practice, during the audits of the 2015 and 2016 financial statements of MiMedx Group, Inc. (“MiMedx”). MiMedx later restated these financial statements… Read More

Penalties: N/A
Respondent: Ellen S. Fisher; David H. Kast & Stockman Kast Ryan & Co. LLP
Violation: This proceeding arises from widespread audit failures in 12 audits of six private funds (collectively, the “Funds” or Funds 1-6) by audit firm SKR and audit partners Fisher and Kast. These audit failures were in connection with SKR’s engagement by an SEC-registered investment adviser (the “Adviser”), to audit funds so that the Adviser could comply with Section 206(4) of the Advisers Act and Rule 206(4)-2 thereunder (the “Custody Rule”)… Read More

Penalties: $8,040,000.00
Respondent: Brian Kabot & Momentus Inc.; Stable Road Acquisition Corp; SRC-Ni Holdings LLC.
Violation: This case concerns materially false statements, omissions, and other deceptive conduct by Momentus, a privately held space company that aspires to provide space infrastructure services, and its former Chief Executive Officer Mikhail Kokorich (“Kokorich”), as it sought to go public through a business combination with Stable Road Acquisition Corp. (“SRAC”), a publicly traded special-purpose acquisition company (“SPAC”)… Read More

Penalties: N/A
Respondent: Frederick M. Stow
Violation: The Commission’s complaint alleged that, between October 2015 and April 2019, Respondent stole approximately $933,500 from two elderly customers’ accounts at Raymond James by, among other things, forging wire transfer letters of authorization to transfer the proceeds of securities sales in those accounts to Respondent’s own bank account… Read More

Penalties: $97,000,000.00
Respondent: Tiaa-Cref Individual & Insitutional Services LLC.
Violation: This matter concerns Respondent’s failure adequately to disclose conflicts of interest and dissemination of inaccurate and misleading statements in connection with recommendations that clients invested in Teachers Insurance and Annuity Association of America (“TIAA”) recordkept employer-sponsored retirement plans (“ESPs”) roll over retirement assets into a managed account program called “Portfolio Advisor.” Respondent had a conflict of interest because Portfolio Advisor generated greater revenue than other available alternatives… Read More

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