SEC Enforcement Actions 2012

Wasson Capital Advisors Ltd. and Anand Sekaran – Florida Misuse of Funds and Theft FNIRA, AAA and JAMS Arbitration and Litigation Attorney

Published on: November 10, 2012 | By Russell L. Forkey, P.A.

SEC Charges Miami-Based Adviser with Hiding Trading Losses and Diverting Client Funds

The Securities and Exchange Commission recently charged a Miami-based investment adviser for defrauding his clients by concealing trading losses and diverting investor funds for personal use.

The SEC alleges that Anand Sekaran and his firm Wasson Capital Advisors Ltd. fabricated documents showing illusory profits after his trading strategy became unprofitable in 2008 and produced substantial losses for clients. Sekaran also misused client funds to pay various personal and business expenses, and he collected fees in excess of what he was due under the arrangements he had with clients.

Lee Cole, Liden Boyne and Electronic Game Card, Inc. – Securities and Investment Fraud and Mismanagement FINRA Arbitration and Litigation Attorney

Published on: November 10, 2012 | By Russell L. Forkey, P.A.

SEC Charges Executives and Auditor of Electronic Game Card Company with Fraud

Recently, the Securities and Exchange Commission (SEC) charged three executives with repeatedly lying to investors about the operations and financial condition of an Irvine, Calif.-based company that purported to sell credit card-size electronic games. The SEC also charged the company’s independent auditor with facilitating the scheme.

The SEC alleges that chief executive officer Lee Cole and chief financial officer Linden Boyne orchestrated a scheme in which Electronic Game Card Inc. (EGMI) enticed investors by claiming to have millions of dollars in annual revenue, hold millions of dollars in investments, and own an off-shore bank account worth more than $10 million. In reality, many of the company’s purported contracts were phony, the purported investments were merely in entities affiliated with Cole or Boyne, and the bank account did not exist. As a result of EGMI’s false claims, the company’s outstanding common stock was once valued as high as $150 million. EGMI is now bankrupt and its stock is worthless.

James F. Ellis – Wilton Manors, Florida Ponzi Scheme and Investment Fraud FINRA Arbitration and Litigation Attorney

Published on: November 9, 2012 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. Ellis, Civil Action No. 0:12-cv-62211

SEC Charges South Florida Man with Recruiting Victims of Ponzi Scheme

The Securities and Exchange Commission recently charged a South Florida man with defrauding at least 14 investors by soliciting them to invest in a Ponzi scheme. A significant number of the victims were members of the gay community in Wilton Manors, Florida and included inexperienced, unaccredited investors.

Stanley B. McDuffie (f/k/a Stanley Roberson and Stanley Battle) and Jilapuhn, Inc., d/b/a Her Majesty’s Credit Union, LLC. – Hollywood, Florida Securities and Investment Fraud and Misrepresentation FINRA Arbitration and Litigation Attorney

Published on: November 8, 2012 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. Stanley B. McDuffie (f/k/a Stanley Roberson and Stanley Battle) and Jilapuhn, Inc., d/b/a Her Majesty’s Credit Union, LLC, Civil Action No. [1:12-cv-02939] (D. Colo., filed November 8, 2012).

SEC Charges Purported Credit Union and Its Principal with Offering Fraud

Recently, the Securities and Exchange Commission filed a civil injunctive action in the United States District Court for the District of Colorado against Stanley B. McDuffie, a resident of Denver, Colorado, and his entity, Jilapuhn, Inc., d/b/a Her Majesty’s Credit Union (HMCU), in connection with a fraudulent and unregistered offering through which McDuffie and HMCU sold more than $532,000 in alleged certificates of deposits (CDs) to investors.

Medlink International, Inc., Aurelio Vuono and James Rose – South Florida Misleading and False Financial Reporting and Annual Report FINRA Arbitration and Litigation Attorney

Published on: November 8, 2012 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. MedLink International, Inc., Aurelio Vuono and James Rose, Civil Action No. 12 Civ. 5325 (E.D.N.Y.)

SEC Charges Medlink International and Two Executives with Fraudulent Filing

The Securities and Exchange Commission recently announced that it filed a civil injunctive action against MedLink International, Inc., its CEO, Aurelio Vuono, and its CFO, James Rose, accusing them of filing an annual report falsely stating that its audit had been completed and defrauding a MedLink investor. MedLink’s principal office is in Hauppauge, New York, and it purports to be a healthcare information technology company. Vuono, age 46 and a recidivist securities law violator, resides in Huntington Station, New York. Rose, age 33, resides in Hauppauge, New York.

Thomas S. Mulholland and James C. Mulholland, Jr. – Florida Real Estate Investment Fraud and Misrepresentation FINRA, AAA and JAMS Arbitration and Litigation Attorney

Published on: October 29, 2012 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. James C. Mulholland, Jr. and Thomas S. Mulholland, Civil Action No. 12-cv-14663 (E.D. Mich., filed October 22, 2012)

SEC Charges Two in Michigan-based Fraudulent Securities Offering

The Securities and Exchange Commission recently announced that it filed a civil injunctive action against brothers James Mulholland and Thomas Mulholland accusing them of conducting a fraudulent, unregistered offer and sale of approximately $2 million in securities.

Ryan M. Jindra – Orlando, Florida Investment Advisor Fraud and Misrepresentation FINRA, AAA and JAMS Arbitration and Litigation Attorney

Published on: October 26, 2012 | By Russell L. Forkey, P.A.

In the Matter of Ryan M. Jindra

Recently, the Securities and Exchange Commission (Commission) announced that the Commission issued an Order Instituting Administrative Proceedings Pursuant to Section 203(f) of the Investment Advisers Act of 1940, Making Findings, and Imposing Remedial Sanctions (Order) against Ryan M. Jindra (Jindra). The Order finds that during at least 2008 through June 2009, Jindra, through his wholly-owned entity Envision Investment Advisors, LLC (Envision), acted as an investment adviser, offering portfolio management services primarily to individual customers, having approximately $41.7 million in customer assets under management as of August 2008. The Order finds that on September 25, 2012, the U.S. District Court for the District of Nebraska entered a final judgment against Jindra in a civil action enjoining him from future violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 204 and 206 of the Investment Advisers Act of 1940 and Rules 204-2(a)(7)(B) and 206(4)-7 thereunder. The Order finds that the Commission’s complaint in the civil action alleged that Jindra caused at least $773,000 to be misappropriated out of accounts held by Envision customers purportedly as advisory fees. In addition, the Order finds that on April 27, 2012, a judgment of criminal conviction was entered against Jindra in U.S. District Court for the District of Nebraska for one count of wire fraud in violation of Title 18, U.S.C. Section 1343, and that Jindra was sentenced to 48 months imprisonment followed by three years of supervised release and ordered to make restitution of $484,235.52.

Based on the above, the Order bars Jindra from association with any broker, dealer, investment adviser, municipal securities dealer, or transfer agent. Jindra consented to the issuance of the Order.

Arnett L. Waters – Florida Securities and Precious Metals Fraud AAA and JAMS Arbitration and Litigation Attorney

Published on: October 19, 2012 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. A.L. Waters Capital, LLC, et al., Civil Action No. 12-cv-10783-DJC (District of Massachusetts)

United States of America v. Arnett L. Waters, Criminal No. 12-cr-10336-DJC (District of Massachusetts)

Defendant in SEC Action Charged by United States Attorney’s Office for the District of Massachusetts

Geoffrey H. Lunn, Darlene A. Bishop and Vincent G. Curry – South Florida Investment and Securities Litigation and FINRA and AAA Arbitration Attorney

Published on: October 19, 2012 | By Russell L. Forkey, P.A.

U.S. Securities and Exchange Commission v. Geoffrey H. Lunn, Darlene A. Bishop and Vincent G. Curry, Civil Action No. 12-cv-02767, United States District Court, District of Colorado

SEC CHARGES THREE INDIVIDUALS FOR THEIR ROLES IN A $5.77 MILLION INVESTMENT SCHEME

Recently, the United States Securities and Exchange Commission charged Geoffrey H. Lunn, Darlene A. Bishop and Vincent G. Curry for their roles in making false and misleading statements to investors and misappropriating investors’ money in connection with a $5.77 million investment scheme under the name of Dresdner Financial, a fictitious financial services company purportedly based in Chicago, Illinois.

Timonthy Huff, Lawrence Lynch, Joseph J. Monterosso and Luis Vargas – Florida Securities and Investment Fraud FINRA and AAA Arbitration and Litigation Attorney

Published on: October 19, 2012 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. Joseph J. Monterosso, et. al., Civil Action No. 07-61693 (S.D. Fla., initial complaint filed on November 21, 2007)

District Court Orders More Than $3 Million In Remedies, Grants Motions For Disgorgement, Civil Penalties and Officer-And-Director Bars Against Timothy Huff, Lawrence Lynch, Joseph J. Monterosso, Luis Vargas

Recently, the Securities and Exchange Commission (Commission) announced that the United States District Court for the Southern District of Florida granted the Commission’s motions for disgorgement, civil penalties, and officer-and-director bars against the four remaining defendants in a civil action arising from a Florida-based accounting fraud.