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U.S. Securities and Exchange Commission

UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

SECURITIES EXCHANGE ACT OF 1934
RELEASE NO. 41962 / September 30, 1999

ADMINISTRATIVE PROCEEDING
FILE NO. 3-10067


______________________________
                              :
                              : ORDER INSTITUTING PROCEEDINGS,
       In the Matter of       : MAKING FINDINGS AND IMPOSING
                              : REMEDIAL SANCTIONS PURSUANT TO
       JERALD F. ALBIN,       : SECTIONS 15(b) and 19(h) OF THE
                              : SECURITIES EXCHANGE ACT OF 1934
         Respondent.          :
______________________________:

I.

The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that public administrative proceedings be instituted against Jerald F. Albin ("Albin") pursuant to Sections 15(b) and 19(h) of the Securities Exchange Act of 1934 ("Exchange Act").

II.

In anticipation of the institution of these proceedings, Albin has submitted an Offer of Settlement ("Offer") which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceedings brought by or on behalf of the Commission, or to which the Commission is a party, and without admitting or denying the Commission's findings contained herein, except the Commission's findings set forth in Paragraphs III.A. and C., which are admitted, Albin consents to the entry of this Order Instituting Proceedings, Making Findings and Imposing Remedial Sanctions pursuant to Sections 15(b) and 19(h) of the Exchange Act ("Order").

Accordingly, IT IS HEREBY ORDERED that proceedings pursuant to Sections 15(b) and 19(h) of the Exchange Act be and hereby are instituted.

III.

On the basis of this Order and Albin's Offer, the Commission finds that:

A. On November 2, 1998, in the case of SEC v. Jerald F. Albin, et al., (Case No. 98-0977-CV-W-8-BD), the Honorable Joseph E. Stevens, Jr., United States District Judge for the Western District of Missouri, entered an Order of Permanent Injunction against Albin, pursuant to his consent and without Albin's admitting or denying the allegations in the Commission's Complaint, enjoining Albin from violating Section 17(a) of the Securities Act of 1933 ("Securities Act"), Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 promulgated thereunder. The Complaint was based on the conduct described in paragraph B.

B. The Complaint alleged that Albin, through Balanced Plan, Inc., d/b/a Balanced Plan Accumulation Trust ("Trust"), defrauded numerous investors to whom he sold promissory notes issued by the Trust ("Trust notes"). From at least 1992 through September 11, 1998, the Commission alleged, Albin raised more than $1.5 million from investors in the Trust notes. The Complaint alleged that Albin misrepresented use of proceeds, and the safety and liquidity of an investment in the Trust notes. The Complaint alleged that Albin promised investors returns from 8% to 13%, represented that investor proceeds would be used to purchase investment vehicles such as certificates of deposit, government bonds and annuities, and told investors an investment in a Trust note was safe and liquid. Contrary to his representations, Albin diverted investor proceeds to himself, to paying the operating expenses of his insurance agency, J.F. Albin Companies, Ltd., and to repaying previous Trust investors. The Complaint also alleged that an investment in the Trust notes was not safe as Albin represented to investors because he used investor proceeds in this manner. Further, the Complaint alleged, Albin misrepresented the liquidity of an investment in the Trust notes because the amount owed Trust investors dwarfed the Trust's assets. Finally, the Complaint alleged that Albin made these representations knowing them to be false because he exclusively controlled the operations of the Trust.

C. On April 1, 1999, in the case of United States of America v. Jerald F. Albin (Case No. 99-00069-01-CR-W-2), the Honorable Fernando J. Gaitan, Jr., United States District Court for the Western District of Missouri, accepted Albin's plea of guilty and entered a conviction against Albin for mail fraud in violation of 18 U.S.C. 2 and 1341. The criminal information against Albin in that case ("Information") was based on the conduct described in paragraph D.

D. The Information charged that Albin, from around 1988 through September 1998, solicited and received approximately $4,570,860 in investor funds by selling promissory notes through the Security Income Plan and the Trust. The Information charged that Albin, among other things, fraudulently misrepresented to Trust note investors that their funds were safe and would be used to buy stocks, public issues, government funds, certificates of deposit, bonds and annuities; and that an investment in a Trust note was liquid and paid a high rate of return. The Information charged that Albin misappropriated approximately $4,335,860 of these investor funds by using the funds for his own personal benefit, to pay the operating expenses of J.F. Albin Companies, Ltd. and to repay investors who requested their funds back.

E. During the period from at least 1992 to around September 1998, Albin willfully violated Section 17(a) of the Securities Act in that, directly or indirectly, in the offer or sale of certain securities in the form of Trust notes, by the use of any means or instruments of transportation or communication in interstate commerce or of the mails, he: employed devices, schemes or artifices to defraud; obtained money or property by means of untrue statements of material facts, or omissions to state material facts necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; or, engaged in transactions, practices or courses of business which would or did operate as a fraud or deceit. As part of this conduct, Albin engaged in the acts and practices detailed in paragraphs III.B. and D. above.

F. During the period from at least 1992 to around September 1998, Albin willfully violated Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder in that, directly or indirectly, in connection with the purchase or sale of certain securities in the form of Trust notes, by the use of any means or instruments of transportation or communication in interstate commerce or of the mails, he: employed devices, schemes or artifices to defraud; obtained money or property by means of untrue statements of material fact or omitted to state material facts necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; or engaged in acts, practices or courses of business which would or did operate as a fraud or deceit. As part of this conduct, Albin engaged in the acts and practices detailed in paragraphs III.B. and D. above.

IV.

In light of the foregoing, it is in the public interest to impose the sanctions specified in the Offer submitted by Albin.

Accordingly, IT IS HEREBY ORDERED that Jerald F. Albin be, and hereby is, barred from association with any broker or dealer.

By the Commission.

Jonathan G. Katz
Secretary

http://www.sec.gov/litigation/admin/34-41962.htm


Modified:09/30/1999