UNITED STATES OF AMERICA
In the Matter of
DONALD D. LUKENS
ORDER INSTITUTING ADMINISTRATIVE
PROCEEDINGS, MAKING FINDINGS,
AND IMPOSING REMEDIAL SANCTIONS
PURSUANT TO SECTION 15(b) OF THE
SECURITIES EXCHANGE ACT OF 1934 AND
SECTION 203(f) OF THE INVESTMENT ADVISERS
ACT OF 1940
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") and Section 203(f) of the Investment Advisers Act of 1940 ("Advisers Act") against Donald D. Lukens ("Lukens" or "Respondent").
In anticipation of the institution of this administrative proceeding, Respondent has submitted an Offer of Settlement ("Offer") that 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 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 this proceeding, and except as to the entry of the injunction set forth in paragraph III.B. below, which are admitted, Respondent consents to the entry of this Order Instituting Administrative Proceedings, Making Findings, and Imposing Remedial Sanctions Pursuant to Section 15(b) of the Securities Exchange Act of 1934 and Section 203(f) of the Investment Advisers Act of 1940 ("Order") as set forth below.
On the basis of this Order and Respondent's Offer, the Commission finds that:
A. Respondent, age 51, is a resident of Camarillo, California. Respondent has been registered with the National Association of Securities Dealers ("NASD") since 1987. During the relevant time period, Respondent conducted business through two sole proprietorships that he controlled: (1) Community Group Funding, an unregistered broker-dealer, and (2) Global Sports & Entertainment, an investment adviser.
B. On September 11, 2002, the United States District Court for the Central District of California entered a Final Judgment as to Donald D. Lukens, permanently enjoining Respondent from violating Section 17(a) of the Securities Act of 1933 ("Securities Act"); Sections 10(b), 15(a) and 15(c) of the Exchange Act; and Rules 10b-5 and 15c1-2 thereunder; and Sections 206(1) and 206(2) of the Advisers Act.
C. The Commission's complaint alleged that Respondent variously acted as an unregistered broker-dealer and investment adviser, made materially false or misleading statements and omissions to brokerage customers and advisory clients concerning the purchase and sale of securities, and misappropriated or diverted customer and client funds for non-investment purposes. In addition to enjoining Lukens from further violations of the antifraud and broker-dealer registration provisions, the Court required Lukens to pay a total $4,750,000, representing disgorgement of $3,266,000, prejudgment interest of $1,374,000, and a civil penalty of $110,000.
In view of the foregoing, the Commission deems it appropriate and in the public interest to impose the sanctions specified in Respondent Lukens' Offer.
IT IS HEREBY ORDERED:
A. Pursuant to Section 15(b)(6) of the Exchange Act, that Respondent Lukens be, and hereby is, barred from association with any broker or dealer; and
B. Pursuant to Section 203(f) of the Advisers Act, that Respondent Lukens be, and hereby is, barred from association from any investment adviser.
By the Commission.
Jonathan G. Katz
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