UNITED STATES OF AMERICA
In the Matter of
JOHN L. MILLING, ESQ.,
ORDER INSTITUTING CEASE-AND-DESIST PROCEEDINGS PURSUANT TO SECTION 8A OF THE SECURITIES ACT OF 1933 MAKING FINDINGS AND IMPOSING A CEASE-AND-DESIST ORDER
The Securities and Exchange Commission deems it appropriate that cease-and-desist proceedings be, and hereby are, instituted against John L Milling, Esq., ("Milling") pursuant to Section 8A of the Securities Act of 1933 ("Securities Act").
In anticipation of the institution of these proceedings, Milling has submitted an Offer of Settlement (the "Offer") which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceeding brought by or on behalf of the Commission, or to which the Commission is a party and without admitting or denying the findings herein, except as to the Commission's jurisdiction over him and the subject matter of these proceedings, Milling consents to the entry of this Order Instituting Cease-and-Desist Proceedings Pursuant to Section 8A of the Securities Act of 1933, Making Findings and Imposing a Cease-and-Desist Order ("Order"), as set forth below.
On the basis of this Order and Milling's Offer, the Commission finds1 that:
Milling, age 69, is a resident of Tenafly, New Jersey, has been licensed to practice as an attorney in New York since 1957, and in New Jersey since 1960, and has a specialized practice in securities law. During the period relevant to this proceeding, Milling was legal counsel to LinkNet, Inc. ("LinkNet") and LinkNet de America Latina, Ltd. ("Latina"). Milling's services included opining on the securities registration requirements of securities offerings by LinkNet and Latina.
1. LinkNet is a Utah corporation located in Salt Lake City, Utah. Latina is a Nevada corporation located at the same office as LinkNet in Salt Lake City, Utah.
2. From at least 1999 through 2000, LinkNet conducted an offering of its securities to persons located throughout the United States, selling those securities through a division of LinkNet created, staffed and operated for that purpose. In a report on Form D filed by LinkNet with the Commission, LinkNet stated it raised $9,659,663 from 1246 investors through the offering.
3. During 2000, Latina conducted an offering of its securities to persons located throughout the United States, selling its securities through a division of Latina created, staffed and operated for that purpose. In a report on Form D filed by Latina with the Commission, Latina stated it raised $7,252,248.50 from 655 investors through the offering.
4. Milling prepared drafts of the Forms D referred to in paragraphs 2 and 3 above.
5. In conducting their offerings, neither LinkNet nor Latina complied with requirements of Rule 506 of Regulation D, or any other provisions that exempt or except securities offerings from the registration requirements of the federal securities laws.
6. In June 2000, upon learning the staff of the Commission was investigating LinkNet and Latina for possible violations of the federal securities laws, and upon receiving information concerning possible violations of the federal securities laws in connection with the offerings of LinkNet and Latina stock, Milling recommended that LinkNet and Latina conduct a joint rescission offer to the purchasers of securities in those offerings.
7. However, Milling advised LinkNet and Latina that the rescission offer not be registered with the Commission in order to expedite the rescission offer.
8. Milling drafted the rescission offer which was reviewed and edited by persons associated with LinkNet and Latina, including Allen Johnson, the president of LinkNet and chairman of the board of Latina. Johnson signed the rescission offer on behalf of both companies.
9. The joint rescission offer was conducted in the Fall of 2000 by LinkNet and Latina without having been registered with the Commission.
10. Based on the foregoing, the Commission finds that Milling caused violations of Sections 5(a) and 5(c) of the Securities Act.
In view of the foregoing, the Commission deems it appropriate to impose the sanctions agreed to in Milling's Offer.
Accordingly, IT IS HEREBY ORDERED, pursuant to Section 8A of the Securities Act, that Milling shall cease and desist from committing or causing any violations and any future violations of Sections 5(a) and 5(c) of the Securities Act.
By the Commission.
Jonathan G. Katz
1 The findings herein are not binding on anyone other than Milling.
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