UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
Securities Exchange Act of 1934
Release No. 34-47665 / April 11, 2003
File No. 3-11085
In the Matter of
|ORDER INSTITUTING ADMINISTRATIVE AND CEASE-AND-DESIST PROCEEDINGS, MAKING FINDINGS, AND IMPOSING REMEDIAL SANCTIONS AND A CEASE-AND-DESIST ORDER PURSUANT TO SECTIONS 15(b) AND 21C OF THE SECURITIES EXCHANGE ACT OF 1934|
The Securities and Exchange Commission deems it necessary and in the public interest that public administrative and cease-and-desist proceedings be, and hereby are, instituted pursuant to Section 15(b)(6) and Section 21C of the Securities Exchange Act of 1934 ("Exchange Act") against Anita Mills-Barry ("Respondent" or "Mills-Barry").
In anticipation of the institution of these proceedings, Respondent has submitted an Offer of Settlement (the "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, Respondent consents to the entry of this Order Instituting Administrative and Cease-and-Desist Proceedings, Making Findings, and Imposing Remedial Sanctions and a Cease-and-Desist Order Pursuant to Sections 15(b) and 21C of the Securities Exchange Act of 1934 ("Order"), as set forth below.
On the basis of this Order and Respondent's Offer, the Commission finds
- Respondent Anita Mills-Barry, age 54, is a Texas resident. She was a registered principal and compliance officer at Dominion Capital Corp. ("Dominion Capital") between August 1996 and April 1998, and the president of Northstar Securities, Inc. ("Northstar") between April 1998 and April 1999. Mills-Barry became the nominal owner of Northstar in April 1998 when she borrowed funds from a company owned by Douglas W. Powell ("Powell") and Charles D. Elliott, III ("Elliott") to purchase it. She sold Northstar, which was a registered broker-dealer (8-21268), to another individual in December 1999. She was the compliance officer of a registered investment adviser between May 2002 and January 2003, and is currently associated with a registered broker-dealer. She has no prior disciplinary history.
- Douglas W. Powell, age 62, is a Texas resident. Between October 1986 and November 1998, Powell was the chief executive officer and registered principal of Dominion Capital, a registered broker-dealer (8-36989). On January 10, 2001, Powell became a registered principal of Northstar.
- Charles D. Elliott, III, age 55, is a Texas resident. He was the president and registered principal of Dominion Capital, and was associated with the firm between November 1986 and November 1998. On December 19, 2000, Elliott became a registered principal of Northstar.
- Northstar is a Texas corporation, which is not in good standing. Northstar was registered with the Commission as a broker-dealer from 1976 until May 29, 2001, when its Form BD-W became effective. Northstar ceased operations in approximately February 2001. It is currently subject to a liquidation proceeding under the Securities Investor Protection Act.
- On August 19, 1997, the Commission instituted administrative proceedings against Powell and Elliott alleging they had failed to supervise certain representatives who engaged in illegal conduct while associated with Dominion Capital, which was a broker-dealer that they owned. On May 13, 1999, the Commission entered an order against Powell and Elliott suspending each of them from: (a) association with any broker or dealer in any capacity for three months; and (b) association in any supervisory or proprietary capacity for a period of an additional six months. The order also revoked Dominion Capital's registration as a broker-dealer. In the Matter of Dominion Capital Corp., Douglas W. Powell and Charles D. Elliott, Exch. Act Rel. No. 41399 (May 13, 1999).
- Between May 13, 1999 and February 13, 2000, Powell and Elliott, without the consent of the Commission, willfully associated with Northstar, a registered broker-dealer, in contravention of the Commission's May 13, 1999 order prohibiting them from such association.
- From approximately May 13, 1999 through December 1999, Mills-Barry willfully aided and abetted and caused Powell and Elliott's violations of Section 15(b)(6)(B)(i) of the Exchange Act and Northstar's violation of Section 15(b)(6)(B)(ii) of the Exchange Act by permitting Powell and Elliott to associate with Northstar in contravention of the Commission's Order, when Mills-Barry knew, or in the exercise of reasonable care should have known, of the Commission's order suspending them from association.
- From at least April 1998 through March 2001, Powell and Elliott, directly or indirectly, controlled the management or policies of Northstar, and wholly or partially financed the business of Northstar.
- Between April 23, 1998 and November 5, 1999, Mills-Barry signed or electronically submitted and caused Northstar to file eight amendments to Form BD. All of the eight amendments were inaccurate because they listed changes in the composition of Northstar's owners and executive officers, but failed to list Powell or Elliott. Additionally, three of the eight amendments falsely represented that no person not otherwise named directly or indirectly controlled Northstar's management or policies, or wholly or partially financed its business.
- As a result of the conduct alleged above, Mills-Barry willfully aided and abetted and caused Northstar's violations of Section 15(b)(1) of the Exchange Act and Rule 15b3-1 thereunder.
- From approximately April 1998 through December 2000, Elliott effected securities transactions or induced the purchase or sale of securities by acting as a principal of Northstar and managing its securities business, and from approximately April 1998 through January 2001, Powell effected securities transactions or induced the purchase or sale of securities by acting as a principal of Northstar and managing its securities business, while neither of them was registered with the firm as a principal. Northstar did not register Elliott as a principal until December 2000 or register Powell as a principal until January 2001.
- Between approximately April 1998 and May 12, 1999, Mills-Barry willfully aided and abetted and caused Northstar's violation of Section 15(b)(1) of the Exchange Act and Rule 15b7-1 thereunder by failing to register Powell and Elliott as principals with the firm during the time that they managed the securities business of Northstar and effected securities transactions on its behalf.
- From approximately April 1998 through November 2000, Northstar did not make and keep current executed employment applications or questionnaires for Elliott and Powell as required by Section 17(a)(1) of the Exchange Act and Rule 17a-3(a)(12) thereunder, and did not maintain a copy of the Commission's May 13, 1999 Order against Elliott and Powell as required by Section 17(a)(1) of the Exchange Act and Rule 17a-3(a)(12)(i)(d) thereunder.
- Mills-Barry willfully aided and abetted and caused Northstar's violation of Section 17(a)(1) of the Exchange Act and Rule 17a-3(a)(12) thereunder by failing to prepare and keep executed employment applications or questionnaires for Elliott and Powell from April 1998 through approximately December 1999. She also willfully aided and abetted and caused Northstar's violation of Section 17(a)(1) of the Exchange Act and Rule 17a-3(a)(12)(i)(d) thereunder by failing to maintain a copy of the Commission's Order against Powell and Elliott.
- Respondent has submitted a sworn Statement of Financial Condition dated January 6, 2003 and other evidence and has asserted her inability to pay a civil penalty.
Respondent shall provide to the Commission, within ten (10) days after the end of the twelve (12) month suspension period described below, an affidavit that she has complied fully with the sanctions described in Section V. below.
In view of the foregoing, the Commission deems it appropriate in the public interest to impose the sanctions specified in Respondent Mills-Barry's Offer.
ACCORDINGLY, IT IS HEREBY ORDERED:
- Pursuant to Section 21C of the Exchange Act that Respondent Mills-Barry cease and desist from committing or causing any violations and any future violations of Sections 15(b)(6)(B)(i) and 15(b)(6)(B)(ii), and from causing any violations and any future violations of Sections 15(b)(1) and 17(a)(1) of the Exchange Act and Rules 15b3-1, 15b7-1 and 17a-3 thereunder.
- Pursuant to Section 15(b)(6) of the Exchange Act, Respondent Mills-Barry be, and hereby is, suspended from association with any broker or dealer for a period of twelve (12) months, effective on the second Monday following the entry of this Order.
- Based upon Respondent's sworn representations in her Statement of Financial Condition dated January 6, 2003 and other documents submitted to the Commission, the Commission is not imposing a penalty against Respondent.
- The Division of Enforcement ("Division") may, at any time following the entry of this Order, petition the Commission to: (1) reopen this matter to consider whether Respondent provided accurate and complete financial information at the time such representations were made; and (2) seek an order directing payment of the maximum civil penalty allowable under the law. No other issue shall be considered in connection with this petition other than whether the financial information provided by Respondent was fraudulent, misleading, inaccurate, or incomplete in any material respect. Respondent may not, by way of defense to any such petition: (1) contest the findings in this Order; (2) assert that payment of a penalty should not be ordered; (3) contest the imposition of the maximum penalty allowable under the law; or (4) assert any defense to liability or remedy, including, but not limited to, any statute of limitations defense.
- Respondent shall comply with the undertaking in Section IV above.
By the Commission.
Jonathan G. Katz
||The findings herein are made pursuant to Respondent's Offer of Settlement and are not binding on any other person or entity in this or any other proceeding.|