Securities and Exchange Commission v. Michael J. Moore, Civil Action No. 2:15-cv-01865 (D. Nev.)

SEC Charges Las Vegas-Based Accountant with Violating SEC and PCAOB Orders

On September 29, 2015, the Securities and Exchange Commission filed a complaint in the U.S. District Court for the District of Nevada against Michael J. Moore. Moore, formerly a certified public accountant, who is a resident of Las Vegas, Nevada.

The SEC alleged in its complaint that Moore violated two regulatory orders:

• The first order, issued by the SEC on October 6, 2009, permanently suspended Moore from appearing or practicing before the SEC as an accountant. Moore violated the SEC order when he performed accounting work for two public companies, Cytta Corp. and Monkey Rock Group, Inc., for the periods from February 2010 through September 2014 and June 2011 through January 2012, respectively.

• The second order, issued by the Public Company Accounting Oversight Board (“PCAOB”) on August 27, 2009, barred Moore from being associated with any PCAOB registered public accounting firm. Moore violated the PCAOB order by performing accounting work for Monkey Rock, which was an “issuer” under Section 2(a)(7) of the Sarbanes-Oxley Act of 2002 (“SOX”). By engaging in this conduct, Moore violated SOX Section 105(c)(7)(B), which prohibits any person who is suspended or barred by the PCAOB from being associated with a registered public accounting firm from willfully becoming or remaining associated with any issuer in an accountancy capacity.

The SEC’s complaint seeks a district court order directing that Moore comply with the SEC order, a permanent injunction prohibiting future violations by Moore of SOX Section 105(c)(7)(B), an order that Moore disgorge all ill-gotten gains he obtained as a result of his violations plus prejudgment interest thereon, and imposition of a civil penalty.

Securities and Exchange Commission v. Delaney Equity Group LLC, Civil Action No. 15-cv-81384 (S.D. Fl.)

The Securities and Exchange Commission recently announced that on October 7, 2015, it obtained an emergency court order preventing Delaney Equity Group LLC (“Delaney”), a registered broker-dealer headquartered in Palm Beach Gardens, Florida, from violating broker-dealer books-and-records provisions of the federal securities laws and from destroying any documents subject to those provisions.

The SEC’s complaint, filed in the United States District Court for the Southern District of Florida, alleges that in April 2015, the SEC Enforcement Division required Delaney to produce to it various categories of documents it was legally required to preserve and produce, upon demand, to the SEC. The complaint further alleges that Delaney, despite being granted several extensions and having made repeated representations through its counsel that the firm would produce documents, has failed to provide any responsive documents to date. As a result of this conduct, the complaint alleges that Delaney violated, and continues to violate, Section 17(a)(1) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 17a-4(j) thereunder, which are provisions of the federal securities laws that require registered broker-dealers to furnish promptly books and records upon request by the SEC.

The same day the SEC filed its complaint, it also filed an emergency motion for a temporary restraining order. Based on the SEC’s motion, on October 7, 2015, the court entered a temporary restraining order that enjoined Delaney, its officers, directors, employees, and agents from violating these provisions for a period of 14 days (subject to the SEC’s filing of a motion for preliminary injunction), and from destroying, altering, or disposing of any of its books, records, and other property until further order of the court. In addition to the temporary restraining order already granted, the SEC is seeking preliminary and permanent injunctions, a civil penalty, and other related relief.