Articles Posted in Securities Litigation


Securities and Exchange Act Rules 10-b9 and 15c2-4 contain requirements that must be satisfied in “Contingency” or “Best Efforts” offerings.  FINRA (the Financial Industry Regulatory Authority) has provided guidance to broker/dealers regarding the requirements of these rules and to remind broker-dealers of their responsibility to have procedures reasonably designed to achieve compliance with these rules.

Broker-dealers that participate in best efforts public and private securities offerings that have a contingency (i.e., an underlying condition or qualification that must take place by a specified date prior to the issuer taking possession of the offering proceeds) must safeguard investors’ funds they receive until the contingency is satisfied. If the contingency is not met, broker-dealers must ensure that investors’ funds are promptly refunded.  There are various contingencies that might need to be satisfied in addition to meeting a subscription amount.

A Pure Bill of Discovery is an equity pleading which is granted pursuant to the Court’s auxiliary jurisdiction.  A Court’s jurisdiction usually consists of the right to decide a case or controversy between parties;  however, Florida Courts, also have the auxiliary power and jurisdiction to enter orders that a person or organization provide documents, submit to depositions or to otherwise comply with the Florida Rules of Civil Procedure presuit.  A Pure Bill of Discovery can be utilized for a number of reasons.  For example, in a recently filed case a company had its computer system hacked.  Someone, then currently unknow, was able to access the company’s bank account electronically and directed the company’s bank to send two wire transfers to two seperate bank account created, by unknown parties, at a nationwide banking institution.  Both the company’s bank and the bank that received the funds into these third party accounts refused to provide, to the company, any of the written communications between the banks relative to this matter and the receiving bank has refused to provide any information to the company about who ownes the accounts that received the funds.  Hence, the necessity of filing a Pure Bill of Discovery so that this information can be discovered and acted upon by the company.  Obviously, time is of the essence in this type of circumstance.

A suit for discovery is initiated by a party filiing a “Complaint For Pure Bill Of Discovery” with either the county or circuit court as appropriate.  The complaint should allege the following: (1) the matters concerning which the discovery asked for is sought; (2) the interests of the several parties in the subject of the inquiry; (3) the complainant’s right to have the relief prayed, its title and interest and what the relationship of the same is to the discovery claimed and that the discovery so attempted to be had is material to the complainant’s rightss that have been duly brought into litigation on the common-law side of the couurt under circumstnaces that entitle the complainant to a disclosure of what is necessary to maintain its own claim in that litigation, and not that of the defendant in the case.  If the Complaint is granted, then the plaintiff, in this case the comapny, can ask the court for leave to conduct discovery using any of the methods allowed by the Florida Rules of Civil Procedure.

Please keep in mind that the above information is being provided for educational purposes only.  It is not designed to be complete in all material respects.  If you have any questions concerning the contents of this post you should contact a qualified professional. 

Bitcoin Ponzi Scheme – South Florida Securities Fraud and Misrepresentation State and Federal Court Litigation Attorney

Securities and Exchange Commission v. Homero Joshua Garza, Civil Action No. 3:15-cv-01760 (D. Conn., Complaint filed Dec. 1, 2015)

SEC Charges Bitcoin Mining Companies

Unlawful Reimbursement of Customer Losses – Boca Raton, Florida FINRA Arbitration and Litigation Attorney:

The Financial Industry Regulatory Authority, Inc. (FINRA) is a self-regulatory authority assigned the responsibility, by the Securities and Exchange Commission, to license, regulate and discipline securities broker/dealers and their employees, including account executives. In the event that FINRA elects to institute an enforcement action, firms and licensed individuals have the responsibility to reflect such action on their U-4 and/or U-5 filings, which can be viewed on the FINRA website under the broker-check section of the site or by viewing the monthly disciplinary information also provided on the FINRA site.

The monthly disciplinary information is referenced on the FINRA site generally in alphabetical order. This post relates to the following company or individuals. If the reader would like to review the entire FINRA release or the broker-check information concerning this matter, you can follow these highlighted links:

T + 3 – Settlement of Security Transactions – Boca Raton, Lake Worth and North Palm Beach, Florida Securities Litigation and Arbitration Attorney

What is meant by T+3?

Generally, investors must complete or settle their security transactions within three business days. This settlement cycle is known as “T+3,” shorthand for “trade date plus three days.”

Securities and Exchange Commission v. Caledonian Bank Ltd., et al., Civil Action No. 15-CV-00894

The Securities and Exchange Commission has charged five offshore entities with offering and selling unregistered penny stocks into the public markets.

According to the SEC’s complaint filed on February 6, 2015, Cayman Islands-based, Caledonian Bank Ltd. and Caledonian Securities Ltd., Belize-based, Clear Water Securities, Inc. and Legacy Global Markets S.A., and Panama-based, Verdmont Capital S.A. (collectively, the “Defendants”) conducted unregistered sales of securities, reaping over $75 million in illegal sales proceeds. Simultaneous with filing its complaint, the SEC obtained an emergency court order freezing assets of the Defendants located in the United States.

South Florida Investment Fraud and Misrepresentation Litigation and Arbitration Attorney:

SEC Charges Oppenheimer With Securities Law Violations Related to Improper Penny Stock Sales

The Securities and Exchange Commission recently charged Oppenheimer & Co. with violating federal securities laws while improperly selling penny stocks in unregistered offerings on behalf of customers.

Boca Raton, Florida Securities and Investment Fund Fraud and Misrepresentation Litigation and Arbitration Attorney:

Securities and Exchange Commission v. Frederic Elm f/k/a Frederic Elmaleh, et al., Case No. 15-cv-60082-DIMITROULEAS/SNOW

SEC Charges Investment Adviser and Manager in South Florida-Based Fraud

Efstratios D. Argyropoulos and Prima Capital Group, Inc. – Boca Raton, Florida Stock Promoter Fraud and Misrepresentation Attorney

Securities and Exchange Commission v. Efstratios “Elias” D. Argyropoulos and Prima Capital Group, Inc., Civil Action No. 2:14-cv-09800 (C.D. Cal.)

SEC Charges Stock Promoter with Fraudulent Scheme Related to Pre-IPO Facebook and Twitter Shares

False and Misleading Press Releases and Marketing Material (Pump and Dump) – Boca Raton, Florida FINRA Arbitration and Litigation Attorney

SEC Charges Penny Stock Company Executives in New Jersey With Issuing False Press Releases to Inflate Stock Price

The Securities and Exchange Commission recently charged father-and-son executives at a New Jersey-based penny stock company for issuing false and misleading press releases while secretly selling thousands of their own stock shares into the market. They agreed to pay nearly $325,000 and accept officer-and-director bars to settle the SEC’s charges.

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