Financial Enforcement Actions | Week of May 01 to May 07

Penalties: N/A
Respondent: Altria Group, Inc; JUUL Labs, Inc
Violation: On May 4, 2021, Respondents filed a motion for leave to file a reply, together with Respondents’ proposed reply (“Reply”). The motion for leave to file the Reply is GRANTED… Read More

Penalties: N/A
Respondent: David J. Jeansonne II & Traffic Jam Events LLC.
Violation: The Commission has twice extended the withdrawal of this matter from adjudication; 2 absent fmt her extension, this matter is scheduled to reve1t to adjudicative status on May 4, 2021… Read More

Penalties: $48,500.00
Respondent: NIC Holding Corp
Violation: Pursuant to an offer of settlement NIC Holding Corp. (“NIC”) presented at a hearing on April 29, 2021, in which NIC neither admitted nor denied the rule violation upon which the penalty is based, a Panel of the NYMEX Business Conduct Committee (“BCC”) found that, on trade date January 15, 2021, NIC held a futures equivalent long position of 5,050 February 2021 Light Sweet Crude Oil Futures (“FEB21 CL”) contracts, which was 2,050 contracts, or 68.33%, over the standard expiration month position limit in effect for trade date January 15, 2021. On January 15, 2021, NIC liquidated its overage position, resulting in profits of $18,500… Read More

Penalties: $64,492.00
Respondent: Murchinson Limited Partnership
Violation: Pursuant to an offer of settlement that Murchinson Limited Partnership (“Murchinson”) presented at a hearing on April 29, 2021, in which Murchinson neither admitted nor denied the rule violation upon which the penalty is based, a Panel of the NYMEX Business Conduct Committee (“Panel”) found that at various points between November 27, 2019 and December 2, 2019, accounts owned or controlled by Murchinson, which were aggregated for the purposes of Exchange position limits, did not adequately reduce their position going into the deliverable spot month and held December 2019 Palladium (DEC19PA) futures equivalent positions that exceeded the spot month position limit of 50 contracts in effect at that time. Specifically, at the close of business on November 27, 2019, Murchinson held an aggregated futures-equivalent long position of 78 DEC19PA contracts, 28 contracts (56%) over the position limit… Read More

Penalties: $50,000.00
Respondent: Kevin Howard
Violation: Pursuant to an offer of settlement that Kevin Howard (“Howard”) presented at a hearing on April 29, 2021, in which Howard neither admitted nor denied the rule violation upon which the penalty is based, a Panel of the NYMEX Business Conduct Committee (“Panel”) found that on multiple occasions during 2019, Howard created and executed trades in covered User Defined Spread (“UDS”) in various Crude Oil Options on Futures contracts on the Globex electronic trading platform for the purpose of receiving advantageous over-allocations or under-allocations of futures contracts that should have been associated with the covered options instrument… Read More

Penalties: $26,440.00
Respondent: Vattenfall Energy Trading Gmbh
Violation: Pursuant to an offer of settlement in which Vattenfall Energy Trading GmbH (“Vattenfall”) neither admitted nor denied the rule violation upon which the penalty is based, on April 29, 2021, a Panel of the New York Mercantile Exchange Business Conduct Committee (“Panel”) found that at the close of business on January 14, 2021, Vattenfall held a 4,000-lot February 2021 WTI Crude Oil Futures (“FEB21 CL”) position, which was 33.3% over the 3,000 lot FEB21 CL position limit that went into effect at the close of business on January 14, 2021. Vattenfall realized a profit of $1,440.00 when it reduced the firm’s excess FEB21 CL futures position on January 15, 2021… Read More

Penalties: $310,000.00
Respondent: SpeedRoute LLC
Violation: From October 1, 2014 through August 17, 2017, SpeedRoute failed to establish and maintain a supervisory system, including supervisory procedures, reasonably designed to achieve compliance with rules prohibiting manipulative activity, including layering, spoofing, and prearranged and wash trades.From September 6, 2017 through March 6, 2018, SpeedRoute failed to comply with various provisions of Securities Exchange Act Rule 15c3-5 relating to establishing, monitoring, and amending customer credit limits and conducting annual reviews and certifications of the effectiveness of its market access risk management controls and supervisory procedures… Read More

Penalties: $100,000.00
Respondent: UnionBanc Investment Services, LLC
Violation: From at least January 2016 through December 2018, UBIS failed to establish and maintain a reasonably designed supervisory system and written supervisory procedures to achieve compliance with applicable securities laws and regulations with respect to certain types of variable annuity transactions. Additionally, from at least January 2016 through September 2019, UBIS failed to establish and maintain a reasonably designed system and written supervisory procedures for the surveillance of rates of variable annuity exchanges. As a result, the firm violated FINRA Rules 3110(a) and (b), 2330(c), (d), and 2010… Read More

Penalties: $250,000.00
Respondent: Cantor Fitzgerald & Co
Violation: Between January 12, 2018 and July 13, 2018 (review period), Cantor inaccurately reported to FINRA 25,434 short interest positions, totaling 65,710,567 shares, when it should have reported 743 short interest positions totaling 10,504,989 shares. The inaccurate reporting resulted from Cantor erroneously reporting positions that were custodied with and already reported by its clearing firm, with which Cantor maintains a fully disclosed clearing agreement (FDCA)… Read More

Penalties: N/A
Respondent: Jason Lynn Dipaola
Violation: Not only did DiPaola fail to disclose his mother’s account at Firm A to Chardan, but he failed to inform Firm A that he was exercising discretion and control over the trading in this account while he was an associated person of a broker-dealer (Chardan). As a result of the foregoing, DiPaola violated NASD Rule 3050(c) and FINRA Rule 2010… Read More

Penalties: $1,800,000.00
Respondent: Umpqua Bank
Violation: The FDIC determined that the Bank has engaged in violations of Section 5 of the Federal Trade Commission Act (“Section 5”), 15 U.S.C. § 45(a)(1), in the commercial finance and leasing products issued by its wholly owned subsidiary, Financial Pacific Leasing, Inc., by engaging in deceptive and/or unfair practices related to certain collection fees and collection practices involving excessive or sequential calling, disclosure of debt information to nonborrowers, and failure to abide by requests to cease and desist continued collection calls… Read More

Penalties: $664,000.00
Respondent: Ishmail Calvin Ross; Zachary Logan; Jessica Snyder; David N. Osegueda
Violation: The U.S. District Court for the Central District of California has entered final judgments against the remaining three defendants in a 2019 SEC action charging them for their alleged roles in a pump-and-dump scheme in the stock of southern California beverage and cannabis company Green Cures & Botanical Distribution, Inc… Read More

Penalties: N/A
Respondent: Corbyn W. Jones
Violation: The Commission’s complaint alleged, among other things, that Jones raised funds from investors in Strayne and 1107 Property Management, two private companies that Jones and a partner formed to apply for necessary licensure and subsequently operate in the medicinal marijuana industry… Read More

Penalties: N/A
Respondent: Apotheca Biosciences, Inc
Violation: The Respondent is delinquent in its periodic filings with the Commission, has repeatedly failed to meet its obligation to file timely periodic reports, and failed to heed a delinquency letter sent to it by the Division of Corporation Finance requesting compliance with its periodic filing obligations or, through its failure to maintain a valid address on file with the Commission as required by Commission rules, did not receive such letter… Read More

Penalties: N/A
Respondent: BioHemp International, Inc
Violation: The Respondent is delinquent in its periodic filings with the Commission, has repeatedly failed to meet its obligation to file timely periodic reports, and failed to heed a delinquency letter sent to it by the Division of Corporation Finance requesting compliance with its periodic filing obligations or, through its failure to maintain a valid address on file with the Commission as required by Commission rules, did not receive such letter… Read More

Penalties: N/A
Respondent: Clontech Laboratories, Inc. n/k/a Takara Bio USA, Inc
Violation: Clontech has failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder because it has not filed any periodic reports with the Commission since it filed a Form 8-A12G on March 3, 1999… Read More

Penalties: $5,000.00
Respondent: Cynthia Kay Whitman
Violation: In August 2018, Whitman accepted a $125,000 loan from her firm customer without providing prior notice to, or obtaining prior written approval from, Edward Jones, her member firm, in violation of FINRA Rules 3240 and 2010… Read More

Penalties: N/A
Respondent: Seth P. Levine
Violation: The Commission’s complaint alleged, among other things, that Levine defrauded investors of millions of dollars. Levine knowingly prepared false operating agreements and other corporate documents, which included materially false and misleading information or omitted material information, and, directly or indirectly, provided the false documents to investors and lenders… Read More

Penalties: $1,572,225.00
Respondent: Maxwell Drever
Violation: These proceedings concern Maxwell Drever’s failure to disclose his receipt of millions of dollars in fees charged to investors in connection with the purchase and redevelopment of a real estate investment project in Dallas, Texas. Between April 2016 and January 2017, Drever raised approximately $53 million from investors who purchased LLC membership interests from Lightning Elm MPN LLC (“Lightning Elm”), a fund that raised money from investors to purchase and redevelop a commercial building located at 1401 Elm St. in Dallas, Texas… Read More

Penalties: N/A
Respondent: Hai Khoa Dang
Violation: The Commission’s complaint alleged that Dang, while acting as an unregistered investment adviser, defrauded a retired couple whom he had advised for 20 years. In late 2017 to early 2018, Dang recommended that the couple open self-managed brokerage accounts, advised them to provide him with their personal usernames and password for those accounts so that he could make trades in their names, and caused them to sign account opening forms that elected aggressive risk profiles without their knowledge or informed consent… Read More

Penalties: $75,000.00
Respondent: Bradley J. Tennison
Violation: Tennison’s guilty plea and state revocation order involved Tennison’s sale to nine investors, between October 2015 through September 2016, of unregistered securities in The Joseph Project, a supposed religious and humanitarian project for which Tennison served as the general manager… Read More

Penalties: $9,000,000.00
Respondent: Under Armour Inc.
Violation: Armour’s failure to disclose the impact of its pull forward practice on revenue growth, Under Armour’s public statements were materially misleading. In particular, throughout the Relevant Period, Under Armour made positive statements regarding its revenue growth rate and the factors contributing to the revenue growth rate, without disclosing the significant impact on revenue from its use of pull forwards. Under Armour also failed to disclose that the sales that had been pulled forward were no longer available in the future quarter. This practice raised significant uncertainty that Under Armour would meet its revenue guidance in future quarters… Read More

Penalties: N/A
Respondent: Kenneth Ciapala
Violation: The Commission’s complaint, filed January 2, 2020, alleged that Ciapala, while acting as an unregistered broker-dealer and working in coordination with others, used offshore nominee companies he controlled to provide a layer of disguise to public company insiders or control persons, who intended to defraud investors by secretly dumping large quantities of stock— including the securities of a New York-based public company, Blake Insomnia Therapeutics, Inc. (“Blake”)—in circumvention of registration and disclosure requirements imposed by the federal securities laws… Read More

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