UNITED STATES OF AMERICA
In the Matter of
ORDER INSTITUTING PROCEEDINGS
The United States Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that public administrative proceedings be instituted pursuant to Section 15(b)(6) of the Securities Exchange Act of 1934 ("Exchange Act") against William Goodhue ("Goodhue" or "respondent").
In anticipation of the institution of these proceedings, the respondent 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 in which the Commission is a party, and without admitting or denying the Commission's findings set forth herein, except as to the jurisdiction of the Commission over him and over the subject matter of these proceedings and the entry of a Final Judgment of Permanent Injunction and Other Relief as described in Section III, paragraph C, below, which he admits, the respondent consents to the entry of this Order Instituting Proceedings, Making Findings and Imposing Remedial Sanctions Pursuant to Section 15(b)(6) of the Securities Exchange Act of 1934 ("Order"), which contains the findings set forth herein and the imposition of the remedial sanctions set forth below.
Accordingly, IT IS HEREBY ORDERED that public administrative proceedings be, and hereby are, instituted against respondent pursuant to Section 15(b)(6) of the Exchange Act.
On the basis of this Order and the respondent's Offer, the Commission finds that:
A. Goodhue, age 49 and a resident of Sidney, Maine, was, from May 1, 1987 through July 1, 1998, the trader for Firm Investment Corp. ("Firm"), a broker-dealer formerly registered with the Commission pursuant to Section 15 of the Exchange Act.1 Goodhue has been a registered representative since 1987 and a registered principal since 1992. Firm was a subsidiary of Firstmark Corp. ("Firstmark") during the relevant period.
B. On June 7, 2000, the Commission filed a complaint in the United States District Court for the District of Maine against Goodhue and two other individuals, SEC v. Vigue, et al. (Civil Action No. 00-113-B), alleging that Goodhue violated the antifraud provisions of Section 17(a) of the Securities Act of 1933 ("Securities Act") and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder and that he aided and abetted violations of the antifraud provisions of Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 ("Advisers Act") committed by Firstmark's former CEO. The complaint alleged, in the alternative, that Goodhue aided and abetted the former CEO's violations of the antifraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. The complaint alleged that Goodhue, as Firm's trader, played a key role in a scheme to manipulate the price of Firstmark stock by effecting manipulative trades and by enforcing a "no net sale" policy. The complaint specifically alleged that Goodhue maintained a waiting list of Firm customers who wished to sell their shares of Firstmark stock but were not permitted to do so until their sell orders could be matched with buy orders, a process that sometimes took months.
C. On February 20, 2001, without admitting or denying any of the allegations in the complaint, except as to jurisdiction, which he admitted, Goodhue consented to the entry of a final judgment of permanent injunction. On February 20, 2001 the United States District Court for the District of Maine entered a final judgment: (i) permanently enjoining Goodhue from, directly or indirectly, violating Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder and Sections 206(1) and (2) of the Advisers Act; and (ii) ordering Goodhue to pay a civil monetary penalty of $15,000.
Based on the foregoing, the Commission deems it appropriate and in the public interest to accept respondent's Offer of Settlement and to impose the sanction agreed to in the Offer. Accordingly, IT IS HEREBY ORDERED, effective immediately, that Goodhue be, and hereby is, barred from association with any broker or dealer, with the right to reapply for association after eighteen months to the appropriate self-regulatory organization, or if there is none, to the Commission.
By the Commission.
Jonathan G. Katz
|1||Firm deregistered through the filing of a Form BDW on June 10, 1999.|
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