Friday, April 26, 2013

SEC Litigation Releases: Week in Review

SEC Announces Settlements with Cache Decker and David Decker in SEC V. Zufelt, April 23, 2013, (Litigation Release No. 22684)

A final judgment was entered against Cache D. Decker and David M. Decker, Jr. for their alleged involvement in "Ponzi schemes operated by Anthony C. Zufelt" through his company Zufelt, Inc. and Silver Leaf Investments, Inc. The final judgment orders the defendants to pay over $257,000 in disgorgement, prejudgment interest, and penalties, as well as permanently enjoins them from future violations of the securities laws.  The SEC's action against Zufelt is pending.

SEC Charges Bahamian Broker-Dealer and its President for Operating Illegally in the United States and Participating in an Unregistered Offering, April 23, 2013, (Litigation Release No. 22683)

According to the complaint (opens to PDF), Bahamas-based Gilbraltar Global Securities, Inc. and its president Warren A. Davis "unlawfully operat[ed] as a broker-dealer in the United States, and...participat[ed] in an illegal unregistered offering and sale of over 10 million shares of a microcap issuer, Magnum d'Or." The SEC claims that the defendants made over $11 million from this illegal activity. The SEC seeks permanent injunction as well as payment of disgorgement, interest, and civil penalties.

Securities and Exchange Commission v. Mark D. Begelman, April 22, 2013, (Litigation Release No. 22682)

A civil action has been filed against Mark D. Begelman, charging him with insider trading "for purchasing Bluegreen Corporation stock in advance of BFC Financial Corporation's announcement that it would acquire Bluegreen." Begelman, a member of the World President's Organization, learned of this information from a fellow WPO member. Begelman allegedly made almost $15,000 in illegal profits from the trading. To settle the charges, Begelman has agreed to a final judgment that permanently enjoins him from future violations of the securities laws and orders him to pay over $30,000 in disgorgement, prejudgment interest, and civil penalties. Additionally, the final judgment bars "him from serving as an officer and director of a public company for a period of five years."

Former "Teach Me to Trade" Saleswoman and Infomercial Personality Linda (Knudsen) Woolf Agrees to Settle Securities Fraud Charges and Pay a $225,000 Penalty, April 19, 2013, (Litigation Release No. 22681)

Final judgments were entered against Linda (Knudsen) Woolf and Hands On Capital, Inc. ordering them to pay a civil penalty of $225,000 and permanently enjoining them from future violations of the Exchange Act. Woolf, "who sold securities trading products and services...[including] software called 'Teach Me to Trade' to investors," allegedly made false statements to investors. Woolf claimed she had become a successful trader from using 'Teach Me to Trade' methods, when in reality she was not a successful trader. Furthermore, "Woolf sold the products and services pursuant to an independent contractor agreement between Hands On Capital and Teach Me to Trade."

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