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U.S. Securities and Exchange Commission

Watermark Financial Services Group, Inc., et al.

On May 16, 2008, the SEC obtained an emergency court order freezing the assets of Watermark Financial Services Group, Inc., Watermark M-One Holdings, Inc., M-One Financial Services, LLC, and/or Watermark Capital Group, LLC (the Watermark Entities), Guy Gane, Jr., and Lorenzo Altadonna, and relief defendants Denkon, Inc. and two of Gane’s children, Guy W. Gane, III and Jenna Gane, in connection with a multi-million dollar offering fraud and Ponzi scheme.

The SEC alleged that entities owned and controlled by Gane − the Watermark Entities − issued fraudulent unregistered notes, and that Lorenzo Altadonna, Deborah Galas and Thomas Brick, registered representatives, sold them.  The SEC alleged that the defendants sold approximately $6 million of the notes to approximately 95 investors in the Buffalo, New York area, a number of whom were senior citizens or near retirement age.  For more information about the SEC’s action, you can read Litigation Release Nos. 20576 (May 15, 2008) and 20583 (May 19, 2008).

On February 14, 2012, Chief Judge William M. Skretny of the United States District Court for the Western District of New York granted the SEC’s motion for summary judgment against the defendants and relief defendants, and subsequently entered final judgments against all defendants and relief defendants. 

On May 1, 2013, Chief Judge Skretny approved a distribution plan and a Fair Fund, which consists of all funds deposited into the Court Registry in connection with the action.  The purpose of the distribution plan is to allocate the Fair Fund to injured investors that suffered a loss as a result of the investment with the Watermark Entities.  An investor who has received back all of his or her initial investment is not entitled to any distribution under the plan.

If you invested in any of the offerings of the Watermark Entities and experienced a financial loss, and have not yet received a Claims Packet, please complete the Proof of Claim Form and send the completed Form, along with any supporting documents, to the Court-appointed Distribution Agent, below.  Your Claim Form, along with supporting documents, must be received by July 29, 2013.

David Stoelting
Senior Trial Counsel
Securities and Exchange Commission
New York Regional Office
3 World Financial Center
Room 400
New York, NY 10281

If you have any questions, you can contact Mr. Stoelting at (212) 336-0174 or stoeltingd@sec.gov.

http://www.sec.gov/divisions/enforce/claims/watermarkfinancial.htm

We have provided this information as a service to investors.  It is neither a legal interpretation nor a statement of SEC policy.  If you have questions concerning the meaning or application of a particular law or rule, please consult with an attorney who specializes in securities law.


Modified: 06/14/2013