UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
SECURITIES EXCHANGE ACT OF 1934
Release No. 47043 / December 19, 2002
File No. 3-10979
In the Matter of
STEPHEN H. KAPLAN
ORDER INSTITUTING PROCEEDINGS
PURSUANT TO SECTION 15(b)(6)
OF THE SECURITIES EXCHANGE
ACT OF 1934, MAKING FINDINGS
AND IMPOSING REMEDIAL SANCTIONS
The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that a public administrative proceeding be, and hereby is, instituted pursuant to Section 15(b)(6) of the Securities Exchange Act of 1934 ("Exchange Act") against Stephen H. Kaplan ("Respondent").
Respondent has submitted an Offer of Settlement ("Offer") that the Commission has determined to accept. On the basis of the foregoing, Respondent hereby:
- Admits the jurisdiction of the Commission over him and over the matters set forth in the Order Instituting Proceedings Pursuant to Section 15(b)(6) of the Securities and Exchange Act of 1934, Making Findings and Imposing Remedial Sanctions;
- 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 in the Order, except as to the fact of his criminal conviction set forth in paragraph III.B.1 below, which is admitted, consents to the entry of an Order by the Commission containing the following findings and remedial sanctions set forth below:
On the basis of this Order and Respondent's Offer, the Commission finds that:
Stephen H. Kaplan, 53, was a registered representative at A.S. Goldmen & Co., Inc. ("Goldmen"), a broker dealer registered with the Commission, from August 1991 to April 1997, during which time he was a manager at Goldmen's New York office. Kaplan was also a registered representative at the following broker-dealers registered with the Commission: Shearson Lehman Brothers Inc. (October 1985 - November 1989); Gruntal & Co. Incorporated (November 1989 - August 1990); D.H. Blair & Co., Inc. (August 1990 - August 1991); William Scott & Co., LLC (May 1997 - June 1997); and May, Davis Group Inc. (June 1997 - September 1998). Kaplan is a resident of New Jersey.
B. State Criminal Conviction
- On May 31, 2002, Kaplan was criminally convicted of attempted enterprise corruption upon the entry of his plea of guilty by the Supreme Court of the State of New York. Kaplan was sentenced to 5 years probation and to pay forfeiture in the amount of $75,000.
- According to the plea allocution upon which his conviction was based, Kaplan, acting as a registered representative and manager of Goldmen, and others, engaged in fraud by: (1) making misrepresentations and false statements regarding the nature and value of certain securities that he sold to investors and failing to disclose the extent to which the securities distributed in an initial public offering had been placed into nominee and controlled accounts; (2) misrepresenting and failing to disclose the extent to which employees of Goldmen were scheming to control, and were controlling, the market for those securities; misrepresenting and failing to disclose the extent to which the prices of certain securities were dependant on the continuation of that scheme; (3) misrepresenting and failing to disclose the extent to which Goldmen brokers were being compensated for selling those securities; (4) misrepresenting and failing to disclose the extent to which customers had been, were being, and would be discouraged and restrained from selling those securities.
Based on the foregoing, the Commission deems it appropriate and in the public interest to accept Respondent's Offer and to impose the sanctions that are set forth in the Offer.
ACCORDINGLY, IT IS ORDERED that, pursuant to Section 15(b)(6) of the Exchange Act, Respondent be, and hereby is, barred from association with any broker or dealer.
By the Commission.
Jonathan G. Katz