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  • SEC Charges Man With Microcap Fraud Involving Shares of Cynk Technology Corp.

    The Securities and Exchange Commission today charged a Canadian citizen with conducting a scheme to conceal his control and ownership of a microcap company whose price quickly spiked last year.  The SEC suspended trading in the stock, Cynk Technology Corp., before the alleged schemer, Phillip Thomas Kueber, could profit on the gains from the stock’s rise to more than $21 from less than 10 cents per share.

    The SEC alleges that Kueber was behind a false and misleading registration statement filed by Cynk and enlisted a small group of straw shareholders and sham CEOs to conceal his control of purportedly non-restricted shares in Cynk stock.  The complaint alleges that the straw shareholders – mainly Kuber’s family members and associates in British Columbia and California – never received the shares they “purchased.”  Kueber allegedly transferred the shares to brokerage accounts and offshore shell companies he secretly controlled and misled broker-dealers about his...

  • SEC Charges Operators of Fraud Based in Upstate New York

    The Securities and Exchange Commission today charged two men and eight companies with defrauding investors, many of them upstate New York residents, who purchased the companies’ securities and so-called “charitable gift annuities.” 

    According to the SEC’s complaint filed in U.S. district court in Syracuse, New York, the alleged scheme raised at least $8 million from 125 or more investors in shares and promissory notes issued by the companies over more than seven years, starting in 2007. 

    The complaint names James P. Griffin, the founder and CEO of 54Freedom Inc., both of Cazenovia, New York, and James Wolle, 54Freedom’s Chief Financial Officer and Treasurer.  Six other Cazenovia, New York-based firms, 54Freedom Securities Inc., MoneyIns Inc., 54Freedom Foundation Inc., 5 Ledyard Ave. LLC, 5 Ledyard Corp., IICNet LLC, and Miami-based 54FreedomTele Inc. also were named in the complaint. 

    In a parallel criminal action, the U.S. Attorney’s Office for the Northern District of New York announced...

  • Daniel M. Hawke, Chief of Market Abuse Unit, to Leave SEC After 16 Years of Service

    The Securities and Exchange Commission today announced that Daniel M. Hawke, chief of the Division of Enforcement’s Market Abuse Unit and former Director of the Philadelphia Regional Office, is leaving the agency after 16 years of service.  He will step down in August to return to the private sector. 

    Mr. Hawke has headed the Market Abuse Unit since its inception in January 2010.  The unit, comprised of more than 60 attorneys and industry specialists in eight SEC offices, focuses on hard-to-detect insider trading activity, market structure violations, market manipulation, and other trading abuses.  Deputy Unit Chiefs Robert Cohen and Joseph Sansone will serve as co-acting Unit Chiefs following Mr. Hawke’s departure.

    “For the past 16 years, Dan has tirelessly served the Commission’s Enforcement Division and demonstrated the highest dedication to our mission,” said SEC Chair Mary Jo White.  “His exemplary leadership in multiple senior roles has served the agency well and...

  • SEC Charges Mead Johnson Nutrition With FCPA Violations

    The Securities and Exchange Commission today announced that Mead Johnson Nutrition Company has agreed to settle charges that its Chinese subsidiary made improper payments to health care professionals at government-owned hospitals to recommend the company’s infant formula to patients who were new or expectant mothers.  

    Mead Johnson Nutrition agreed to pay $12 million to settle the SEC’s finding that it violated the Foreign Corrupt Practices Act (FCPA).    

    An SEC investigation found that employees funded the improper payments through “distributor allowance” funds paid to third-party distributors who market, sell, and distribute the company’s products in China.  Although the funds contractually belonged to the distributors, employees exercised some control over how the money was spent and provided specific guidance to distributors on how to use the funds.  Cash and other incentives were subsequently paid to health care professionals in China hospitals to recommend Mead Johnson Nutrition products and provide the company...

  • Former Oppenheimer Employees Settle Charges Involving Unregistered Sales of Penny Stocks

    The Securities and Exchange Commission today announced that three former employees of Oppenheimer & Co. Inc. have agreed to settle charges stemming from the unregistered sales of billions of shares of penny stocks on behalf of a customer.  The actions involve a portion of the conduct announced in January in a settled enforcement action against Oppenheimer in which the broker-dealer admitted wrongdoing and paid $20 million to the SEC and the Treasury Department’s Financial Crimes Enforcement Network.

    Today’s actions were instituted against Scott A. Eisler, a former registered representative at Oppenheimer’s branch in Boca Raton, Fla., his former branch manager and supervisor Arthur W. Lewis, and Lewis’s supervisor Robert Okin, a former head of Oppenheimer’s Private Client Division.

    According to the SEC’s orders instituting settled administrative proceedings, on behalf of the Oppenheimer customer, Eisler executed billions of penny stock shares in illegal unregistered distributions with Lewis participating in and in some...

SEC Press Releases