United States of America
In the Matter of
GREG BALK and DAX ROSS
|ORDER INSTITUTING PUBLIC ADMINISTRATIVE PROCEEDINGS PURSUANT TO SECTION 15(b) 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 public administrative proceedings be, and hereby are, instituted pursuant to Section 15(b) of the Securities Exchange Act of 1934 (“Exchange Act”) against Greg Balk (“Balk”) and Dax Ross (“Ross”) (collectively the “Respondents”).
In anticipation of the institution of these proceedings, the Respondents have each submitted an Offer of Settlement (“Balk’s Offer” or “Ross’ 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 them and the subject matter of these proceedings, and the findings contained in Section III. A(5) with respect to Balk, which are admitted by Balk, and the findings contained in Section III. B(4) with respect to Ross, which are admitted by Ross, the Respondents each consent to the entry of this Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934, Making Findings, and Imposing Remedial Sanctions (“Order”), as set forth below.
On the basis of this Order and Balk’s Offer, the Commission finds that
1. Balk, 42 years old, was a shareholder of SeaEscape Entertainment, Inc. (“SeaEscape”).
2. Balk participated in an offering of SeaEscape stock, which is a penny stock.
3. On August 8, 2002, a federal grand jury in Miami, Florida returned an Indictment charging Balk in a two-count Indictment for conspiracy to commit securities fraud and securities fraud, in the criminal action entitled United States of America v. Greg Balk, et al, Case No. 02-60164-CR-DIMITROULEAS, in the United States District Court for the Southern District of Florida.
4. The Indictment alleged, among other things, that Balk conspired to pay undisclosed kickbacks of approximately $3.2 million to an undercover agent of the Federal Bureau of Investigation posing as a corrupt securities trader employed by the United States-based representative of a fictitious foreign mutual fund (“the Fund”) and others in return for their inducing the Fund to purchase approximately $8 million of overpriced SeaEscape stock. According to the Indictment, Balk fabricated false documents in order to conceal the illegal payment of bribes and misrepresented the truth about due diligence services that had purportedly been performed by various individuals.
5. On November 15, 2002, Balk pled guilty to one count of conspiracy to commit securities fraud in the United States District Court for the Southern District of Florida in United States of America v. Greg Balk, et al, Case No. 02-60164-CR-DIMITROULEAS. On February 21, 2003, a judgment in the criminal case was entered against Balk. He was sentenced to a prison term of 18 months followed by three years of supervised release.
On the basis of this Order and Ross’ Offer, the Commission finds that
1. At all relevant times, Equity Technologies and Resources, Inc., (Equity”) was a penny stock as defined in the Exchange Act and rules promulgated thereunder.
2. At all relevant times, Ross was a registered representative associated with a registered broker-dealer.
3. At all relevant times, Ross participated in an offering of Equity stock, which is a penny stock.
4. On November 25, 2002, Ross pled guilty to a criminal indictment charging that he participated in a conspiracy to commit mail and securities fraud. United States v. Dax Ross, et al., Case No. 02-60165-CR-DIMITROULEAS, in the United States District Court for the Southern District of Florida. On February 20, 2003, Ross was sentenced to 15 months imprisonment and 36 months supervised release and was fined $1,000.00.
5. The criminal indictment alleged that from August 1999 through August 2002, Ross conspired to commit mail and securities fraud by participating in a fraudulent scheme to artificially inflate the market price of Equity stock by recommending and selling shares of Equity stock to his customers in exchange for bribes.
In view of the foregoing, the Commission deems it appropriate and in the public interest to impose the sanctions specified in Balk’s Offer and as specified in Ross’ Offer.
Accordingly, it is hereby ORDERED:
A. Pursuant to Section 15(b)(6) of the Exchange Act, that Balk be, and hereby is barred from participating in any offering of a penny stock, including: acting as a promoter, finder, consultant, agent or other person who engages in activities with a broker, dealer or issuer for purposes of the issuance or trading in any penny stock, or inducing or attempting to induce the purchase or sale of any penny stock.
B. Pursuant to Section 15(b)(6) of the Exchange Act, that Ross be, and hereby is barred from participating in any offering of a penny stock, including: acting as a promoter, finder, consultant, agent or other person who engages in activities with a broker, dealer or issuer for purposes of the issuance or trading in any penny stock, or inducing or attempting to induce the purchase or sale of any penny stock; and
C. Pursuant to Section 15(b) 6 of the Exchange Act, that Ross, be and hereby is barred from association with any broker or dealer.
Any reapplication for association by Ross 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 Ross, 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.
By the Commission.
Jonathan G. Katz
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