Friday, November 22, 2013

SEC Litigation Releases: Week in Review

Court Enters Final Judgment by Consent Against SEC Defendant Corey Ribotsky, November 21, 2013, (Litigation Release No. 22873)

A final judgment was entered against Corey Ribotsky who, along with The NIR Group, LLC, allegedly made "false statements to investors regarding the poor performance and trading strategy of the various AJW Funds he managed" during the financial crisis. Ribotsky also allegedly "misappropriated client assets and misled investors about the decision to form the AJW Master Fund." The final judgment permanently enjoins Ribotsky from future violations of the securities laws and orders him to pay $14.5 million in disgorgement, prejudgment interest, and penalties. The SEC has also barred Ribotsky from "association with any broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or nationally recognized statistical rating organization, with the right to reapply after four years."

Claims against NIR have been dropped "because that entity is defunct and has no assets."

Former Rochdale Securities Broker Sentenced to 30 Months' Imprisonment for Rogue Trades, November 21, 2013, (Litigation Release No. 22872)

David Miller was sentenced to "30 months imprisonment, followed by three years of supervised release, for his role in a fraudulent scheme to place a series of unauthorized purchases of more than 1.6 million shares of Apple, Inc. stock on October 25, 2012 while employed as an institutional sales trader for Rochdale Securities LLC." His scheme caused Rochdale to suffer a loss "of $5,292,202.50 and [cease] all business operations." Chatigny has also been ordered to make full restitution to Rochdale. Based on the SEC's action, Miller had previously been permanently enjoined from violating the federal securities laws and barred from "association with any broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or nationally recognized statistical rating organization, and...from participating in any offering of penny stock."

SEC Files Subpoena Enforcement Action Against Edward M. Daspin for Failure to Testify in Offering Fraud Investigation, November 18, 2013, (Litigation Release No. 22871)

Last Friday, the SEC filed an enforcement subpoena action against "Edward Michael Daspin, also known as 'Edward Michael' and 'Ed Michael,'" which calls for Daspin's "testimony in an ongoing investigation into...potential fraud in the offer and sale of securities of three related companies, Worldwide Mixed Martial Arts Sports, Inc., WMMA Distribution, Inc. and WMMA Holdings, Inc."

SEC Charges Former Level Global Investment Banker with Insider Trading, November 14, 2013, (Litigation Release No. 22870)

According to the complaint (PDF), Mark Megalli, "a former investment banker at Level Global Investors, L.P.," caused Level Global to trade on insider information in Carter's Inc. securities. This insider trading caused Level Global to allegedly profit and avoid losses "in excess of $3 million dollars."  The SEC has charged Megalli with violating the securities laws and seeks a permanent injunction, disgorgement, prejudgment interest, and civil monetary penalties.




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