U.S. Securities & Exchange Commission
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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. 47242 / January 24, 2003

Investment Advisers Act of 1940
Release No. 2102 / January 24, 2003

Administrative Proceeding
File No. 3-10875


In the Matter of

MONICA LYNN COLEMAN

Respondent.


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ORDER MAKING FINDINGS AND IMPOSING REMEDIAL SANCTIONS

I.

The Securities and Exchange Commission ("Commission") deems it appropriate to enter an order in this previously instituted public administrative proceeding, making findings and imposing remedial sanctions against Monica Lynn Coleman ("Respondent" or "Coleman") 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").

II.

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 to which the Commission is a party, and without admitting or denying the findings herein, except as to the Commission's jurisdiction over her and the subject matter of these proceedings, and the findings in paragraphs III.1, III.2 and III.3. below, which are admitted, Respondent consents to the entry of this Order Making Findings and Imposing Remedial Sanctions ("Order"), as set forth below.

III.

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

1. Coleman and Craten LLC ("Coleman Craten"), located in Baltimore, Maryland, was registered with the Commission as an investment adviser from March 1998 until January 2000, when its investment adviser registration was cancelled for failure to establish its continued eligibility for registration with the Commission.

2. Coleman, age 46, is a resident of Baltimore, Maryland. From September 30, 1998 to April 20, 1999, Coleman was a registered representative associated with Corporate Securities Group, Inc., a broker-dealer registered with the Commission. From November 3, 1987 to February 17, 1998, Coleman was a registered representative associated with Legg Mason Wood Walker Incorporated ("Legg Mason"), a broker-dealer registered with the Commission. In February 1998, Coleman established Coleman Craten. Coleman acted as a managing partner for Coleman Craten, which registered as an investment adviser with the Commission on March 9, 1998, and owned 50 percent of the firm. Both Coleman and Coleman Craten are currently in bankruptcy.

3. On April 16, 2002, in the case of State of Maryland v. Monica Lynn Coleman, No. 100362045, in the Circuit Court for Baltimore City, Coleman pleaded guilty to five misdemeanor counts of securities fraud and one misdemeanor count of fraudulent misappropriation by a fiduciary. The criminal bill alleged that, among other things, between June 1997 and April 1999, while associated with either Legg Mason or Coleman Craten, Coleman "unlawfully did in connection with the offer, sale, and purchase of a security" in the name of at least five victims, "willfully and knowingly employ devices, schemes and artifices to defraud, and make untrue statements of material fact and omit to state material facts, and engage in acts, practices and courses of conduct which operated as fraud and deceit" upon certain victims, and "unlawfully did fraudulently and willfully appropriate to a use and purpose not in the due and lawful execution of her trust for and on behalf of [clients. . . funds] received by her in her fiduciary capacity. . ." By her guilty plea, Coleman admitted to misappropriating more than $2.6 million from at least five investors for her personal use and to pay other investors.

4. Coleman's criminal conviction arose out of conduct that occurred while she was an associated person of a broker-dealer and an investment adviser, and involved fraud in the purchase or sale of securities, and misappropriation of investor funds.

IV.

In view of the foregoing, the Commission deems it appropriate and in the public interest to impose the sanctions specified in Respondent Coleman's Offer.

Accordingly, IT IS HEREBY ORDERED:

Pursuant to Section 15(b) of the Exchange Act and Section 203(f) of the Advisers Act, that Respondent Coleman be, and hereby is barred from association with any broker, dealer, or investment adviser.

By the Commission.

Jonathan G. Katz
Secretary

 

http://www.sec.gov/litigation/admin/34-47242.htm


Modified: 01/27/2003