UNITED STATES OF AMERICA
In the Matter of
TO SECTION 15(b) OF
THE SECURITIES EXCHANGE
ACT OF 1934, MAKING
FINDINGS AND IMPOSING
The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that public administrative proceedings be and hereby are instituted pursuant to Section 15(b) of the Securities Exchange Act of 1934 ("Exchange Act"), against Judah Wernick ("Wernick").
In anticipation of the institution of these proceedings, Wernick has submitted an Offer of Settlement to the Commission, which the Commission has determined to accept. Solely for the purposes 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 findings contained herein, except as to entry of the injunction described below and the Commission's jurisdiction over him and over the subject matter of this proceeding, which are admitted, Wernick consents to the institution of public administrative proceedings, and the findings and remedial sanctions set forth below.
On the basis of this Order and the Offer of Settlement submitted by Wernick, the Commission finds that:
A. Wernick, age 38, is a resident of Woodmere, New York, and was a trader associated with a broker-dealer registered with the Commission during the relevant trading period.
B. On September 30, 1997, the Commission filed a Complaint in the United States District Court for the Southern District of New York against Wernick, captioned SEC v. Leonard B. Greer and Judah Wernick, Case No. 97 Civ. 7267 (MP).
C. The Commission's Complaint alleges that from January 1994 through April 1994, Greer and Wernick violated the federal securities laws by engaging in the fraudulent manipulation of the market price of the stock of AFGL International, Inc. from $1 to $7 per share. The Complaint alleges that Wernick accomplished the manipulation by controlling the supply of AFGL stock that was available to the market; by accumulating over two-thirds of the freely-tradable AFGL stock in Wegard's firm proprietary account; by exerting price leadership to increase the market price of AFGL stock; and by generating retail demand for AFGL stock. The Complaint alleges that, during an intensive nine-day selling effort that began on April 20, 1994, Greer's firm, Wegard, sold over 1 million shares of AFGL stock to its customers, at artificially inflated prices, netting a profit of approximately $3.5 million. The Complaint alleges that Wernick profited by at least $207,000 by trading AFGL securities in this scheme.
D. On June 5, 2001, in SEC v. Greer, et al., the court entered an order enjoining Wernick from violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. Wernick consented to the entry of the order, without admitting or denying the allegations in the Complaint.
In view of the foregoing, the Commission deems it appropriate and in the public interest to accept the Offer of Settlement of Judah Wernick.
Accordingly, IT IS ORDERED that Respondent Judah Wernick is barred from association with any broker or dealer.
By the Commission.
Jonathan G. Katz
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