UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
SECURITIES EXCHANGE ACT OF 1934
Release No. 41953 / September 30, 1999
File No. 3-10058
In the Matter of :
: ORDER INSTITUTING PUBLIC
AMERIVEST FINANCIAL GROUP, INC., : ADMINISTRATIVE PROCEEDING,
: MAKING FINDINGS AND
: IMPOSING REMEDIAL SANCTIONS
The Securities and Exchange Commission ("Commission") deems it
appropriate in the public interest and for the protection of investors that a
public administrative proceeding pursuant to Sections 15(b) and 19(h) of the
Securities Exchange Act of 1934 ("Exchange Act") be instituted against
Respondent Amerivest Financial Group, Inc. ("Amerivest").
In anticipation of the institution of this administrative proceeding,
Amerivest has submitted an Offer of Settlement ("Offer"), which the
Commission has determined to accept. Solely for the purpose of this proceeding
and any other proceeding brought by or on behalf of the Commission or in which
the Commission is a party, and without admitting or denying the findings
contained herein, except that Amerivest admits the jurisdiction of the
Commission over it and over the subject matter of this proceeding and the entry
of a Final Judgment of Permanent Injunction and Other Relief against it as set
forth in paragraph III.B., Amerivest consents to the entry of this Order
Instituting Public Administrative Proceeding, Making Findings and Imposing
Remedial Sanctions ("Order") set forth below.
Accordingly, IT IS ORDERED that a proceeding pursuant to Sections
15(b) and 19(h) of the Exchange Act be, and hereby is, instituted.
On the basis of this Order and the Offer submitted by Amerivest, the
Commission finds that:
A. The Commission's public official files disclose that Amerivest has been
registered with the Commission as a broker-dealer since November 17, 1992 (File
B. A Final Judgment of Permanent Injunction and Other Relief ("Final
Judgment") was entered by the United States District Court for the Central
District of California against Amerivest on September 28, 1999. The Final
Judgment permanently enjoins Amerivest from violations of Section 17(a) of the
Securities Act of 1933, and Sections 10(b) and 15(c)(1)(A) of the Exchange Act
and Rules 10b-5 and 15c1-2 thereunder. SEC v. Whitworth Energy Resources,
Ltd.; Williston Basin Holding Corp.; Amerivest Financial Group, Inc.; Peter
Sacker; Jerry W. Anderson; and Robert M. Kerns, Civil Action No. 97-6980 CAS
C. The Commission's Complaint filed in the action described above alleges
that, from at least 1992 until September 1997, Amerivest acted as the selling
agent for at least eighteen offerings in the form of oil and gas joint venture
and limited partnership interests. These offerings raised over $16 million from
over 500 investors nationwide, based upon fraudulent representations that:
1. The source of monthly distributions to investors would be from oil and gas
sales. In fact, from at least mid-1996 to September 1997, only a small portion
of distributions was from oil and gas sales. Instead, new investor funds were
used to pay distributions to other investors in a Ponzi-like scheme.
2. Investor funds were safeguarded in escrow accounts when they in fact were
3. Defendant Whitworth Energy Resources, Ltd. ("Whitworth") owned
particular oil and gas wells it in fact did not own.
Additionally, Amerivest is alleged to have fraudulently:
1. Sold the same interests in particular wells to investors in at least three
2. Failed to disclose that the operator of certain of the oil and gas wells
claimed that Defendants Whitworth and Williston Basin Holding Corp.
("Williston") owed it a substantial debt, and that at least since
mid-1996 most monies generated by the wells operated by that operator (over $1
million) were applied to the debt rather than being returned to Whitworth and
Williston for ultimate distribution to investors.
3. Grossly overstated Whitworth's ownership interests in about 400 wells by a
factor of twenty.
Based on the foregoing, the Commission deems it appropriate and in the public
interest to accept the Offer submitted by Amerivest and impose the sanctions
specified in the Offer.
Accordingly, IT IS HEREBY ORDERED that:
The broker-dealer registration of Amerivest, be and hereby is, revoked.
By the Commission.
Jonathan G. Katz