UNITED STATES OF AMERICA
In the Matter of
Keith G. Greenberg,
|ORDER MAKING FINDINGS AND IMPOSING REMEDIAL SANCTIONS PURSUANT TO SECTION 15(b) OF THE SECURITIES EXCHANGE ACT OF 1934|
The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest to enter an order in this previously instituted public administrative proceeding, instituted on May 28, 2003, making findings and imposing remedial sanctions against Keith G. Greenberg ("Respondent" or "Greenberg") pursuant to Section 15(b) of the Securities Exchange Act of 1934 ("Exchange Act").
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 him and the subject matter of these proceedings, and the findings contained in Section III.C and D below, which are admitted, Respondent consents to the entry of this Order Making Findings and Imposing Remedial Sanctions Pursuant to Section 15(b) 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 that:
A. Greenberg was a co-founder of U.S. Diagnostic, Inc. ("USDL"), a company that operates outpatient diagnostic imaging centers and is headquartered in West Palm Beach,Florida. Respondent, 45, resides in Goldens Bridge, New York. At all times relevant, Greenberg acted as a broker or dealer without registering with the Commission.
B. In a complaint filed in December 2000, Securities and Exchange Commission v. Keith Greenberg and Coyote Consulting and Financial Services, LLP, 00-9109-CIV-HURLEY/LYNCH (S.D. Fla.), the Commission alleged that Greenberg prepared or directed the preparation of numerous public statements by USDL which identified him as an officer of the company, but which fraudulently failed to disclose his criminal conviction and his injunction in previous litigation with the Commission. The Commission's complaint additionally alleged that Coyote Consulting and Financial Services, LLP ("Coyote"), through Greenberg, acted as a broker without registering with the Commission. Coyote was, at all relevant times, a Florida limited liability company owned by a Greenberg family trust and Greenberg's wife, and controlled by Greenberg.
C. On April 4, 2002, the U.S. District Court for the Southern District of Florida entered a final judgment of permanent injunction by default against Greenberg and Coyote permanently enjoining Greenberg from violating Section 17(a) of the Securities Act of 1933, Sections 10(b) and 15(a) of the Exchange Act and Rule 10b-5 thereunder, and from aiding and abetting violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-1, and 13a-13 thereunder, and permanently enjoining Coyote from violating Section 15(a) of the Exchange Act. The final judgment also barred Greenberg from acting as an officer or director of any public company. The District Court also held Greenberg and Coyote liable for civil penalties and jointly and severally liable for disgorgement.
D. On June 4, 2002, the Court ordered an evidentiary hearing to determine the appropriate disgorgement and civil penalty amounts. In August 2002, following the evidentiary hearing, U.S. Magistrate Judge Frank J. Lynch, Jr. filed a report recommending that Greenberg and Coyote be held jointly and severally liable for $3,828,000 in disgorgement and $1,987,346 in prejudgment interest, that a maximum third-tier civil penalty of $100,000 be imposed on Greenberg, and that a maximum third-tier civil penalty of $500,000 be imposed on Coyote. U.S. District Judge Hurley adopted the recommending report in its entirety.
In view of the foregoing, the Commission deems it appropriate and in the public interest to impose the sanctions specified in Respondent's Offer.
Accordingly, it is hereby ORDERED:
Pursuant to Section 15(b)(6) of the Exchange Act, that Respondent be, and hereby is, barred from association with any broker or dealer.
Any reapplication for association by the Respondent will be subject to the applicable laws and regulations governing the reentry process, and reentry may be conditioned upon a number of factors, including, but not limited to, the satisfaction of any or all of the following: (a) any disgorgement ordered against the Respondent, whether or not the Commission has fully or partially waived payment of such disgorgement; (b) any arbitration award related to the conduct that served as the basis for the Commission order; (c) any self-regulatory organization arbitration award to a customer, whether or not related to the conduct that served as the basis for the Commission order; and (d) any restitution order by a self-regulatory organization, whether or not related to the conduct that served as the basis for the Commission order.
For the Commission, by its Secretary, pursuant to delegated authority.
Jonathan G. Katz
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