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U.S. Securities and Exchange Commission

United States Securities and Exchange Commission

Securities Exchange Act of 1934
Release No. 48114 / July 1, 2003

Administrative Proceeding
File No. 3-11169

SEC Institutes Administrative Proceeding against Roger M. Detrano Based on Entry of Injunction and Criminal Conviction

The Securities and Exchange Commission today instituted an administrative proceeding against Roger M. DeTrano of New York City, based on (1) the entry of an injunction against him in SEC v. AbsoluteFuture.com, et al., (Civ. Action No. 01-9058 (S.D.N.Y.)); and (2) his criminal conviction in a parallel criminal proceeding. In the Order Instituting Administrative Proceedings Pursuant To Section 15(b)(6) of the Securities Exchange Act of 1934 ("Order"), the Division of Enforcement alleges that on January 22, 2003, the District Court for Southern District of New York entered a default judgment against DeTrano permanently enjoining him from, directly or indirectly, violating the anti-fraud, registration and reporting provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. The Order further alleges that on January 25, 2002, in a parallel criminal proceeding brought by the United States Attorney's Office for the Southern District of New York, DeTrano pled guilty to two counts of conspiracy to commit securities fraud in United States v. Roger DeTrano, Criminal Information No. 00 Cr 1098-03 (S.D.N.Y.). On September 20, 2002, the court entered a criminal judgment of conviction for these offenses against DeTrano and sentenced him to 70 months imprisonment and three years supervised release, and assessed a criminal penalty of $200.

According to the Order, on October 11, 2001, the Commission filed a complaint against, among others, DeTrano and his business associate, Edward A. Durante ("Durante"), alleging that from December 1999 through April 2000, they engaged in a fraudulent scheme to manipulate the stock of AbsoluteFuture.com ("AFTI"), an issuer quoted on the NASD OTC Bulletin Board. The Order alleges that, during the relevant time period, AFTI was a penny stock. As part of the scheme, the complaint alleged that AFTI made false statements in a filing with the Commission in order to register 4.1 million shares that it issued to five entities controlled by DeTrano and Durante. In particular, the complaint alleged that AFTI falsely represented that the entities would provide bona fide consulting services in exchange for the shares. Once the shares were issued, DeTrano failed to report his holdings of over 10% of AFTI's shares, according to the complaint. DeTrano and Durante sold the improperly registered shares to the public as part of their scheme to manipulate the price of AFTI stock. DeTrano also caused AFTI to issue at least one false press release timed to coincide with manipulative trading conducted by Durante. The Commission also alleged in the complaint that DeTrano's actions were in violation of Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, Sections 10(b), 13(a), 13(d) and 16(a) of the Exchange Act and Rules 10b-5, 12b-20, 13a-1, 13d-1 and 16a-3 thereunder.

A hearing will be scheduled before an administrative law judge to determine whether the allegations contained in the Order are true, to provide DeTrano an opportunity to dispute these allegations and to determine what sanctions, if any, are in the public interest.

For further information, see Litigation Release Nos. 17180, 18004.

 

http://www.sec.gov/litigation/admin/34-48114.htm


Modified: 07/01/2003