April, 2012

Hedge Fund, Broker/Dealer and Investment Advisor Fraud, Misrepresentation and Misrepresentation Lawyer, Russell L. Forkey, Esq.

SEC Files Settled Charges Against Silicon Valley Man in Connection With Offering Fraud, Revokes US Registration of Securities of His Company

The United States Securities and Exchange Commission today announced two enforcement actions arising from a $7 million offering fraud perpetrated by Benedict Van of Santa Clara, California, in connection with hereUare, Inc. (hereUare) and eCity, Inc. (eCity), two Internet companies that he controls.

First, the SEC filed a settled civil action against Van, hereUare, and eCity in the U.S. District Court for the Northern District of California. The SEC’s complaint alleges that from 2007 through 2008, Van raised over $7 million from investors through serial, oral misrepresentations about the companies’ prospects for an IPO and revenue growth. According to the complaint, Van falsely told investors that the companies would soon go public within a matter of months and generate millions in IPO returns for investors. The complaint further alleges that in reality, the companies had no plan to go public, were still developing their products, were not generating revenue, and survived only through investor funds. Finally, the complaint alleges that Van, as CEO and founder of both companies, knew, or was reckless in not knowing, that his misrepresentations to investors were false and/or misleading.

The SEC’s complaint charges Van, hereUare, and eCity with violations of Section 17(a)(2) of the Securities Act of 1933 (Securities Act) and Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5(b) thereunder; and Van and hereUare with violations of Sections 5(a) and 5(c) of the Securities Act. As part of the settlement, the defendants’ signed consents – which are subject to approval by the court – provide that each defendant is permanently enjoined against future violations of the statutes and rules each is alleged to have violated. In addition, defendant Van’s signed consent provides that, without admitting or denying the Commission’s allegations, he is permanently barred from serving as the officer or director of a public company. The Commission agreed to waive disgorgement and declined to assess a penalty against Van based on his demonstrated inability to pay.

Second, the SEC instituted a settled proceeding pursuant to Section 12(j) of the Exchange Act revoking the United States registration of each class of registered securities of hereUare, Inc. for failure to make required periodic filings with the Commission.

Without admitting or denying the findings in the Order, except as to jurisdiction, which it admitted, hereUare consented to the entry of an Order Instituting Proceedings Pursuant to Section 12(j) of the Securities Exchange Act of 1934, Making Findings, and Revoking Registration of Securities finding that it had failed to comply with Section 13(a) of the Exchange Act and Rules 13a-1 and 13a-13 thereunder and revoking the registration of each class of hereUare’s securities pursuant to Section 12(j) of the Exchange Act. [SEC v. Van, et al. (Civil Action No. CV 12 1743) (N.D. Cal.)]