UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
Securities Exchange Act of 1934
Release No. 50363 / September 14, 2004
Administrative Proceeding File No. 3-11650
In the Matter of Kenneth A. Orr
The Commission instituted administrative proceedings against Kenneth A. Orr based upon his criminal conviction and the entry of an injunction against him.
The Division of Enforcement alleges that on January 3, 2002, Orr pleaded guilty to one count of conspiracy to commit money laundering. The count of the indictment to which Orr pleaded guilty alleged, among other things, that while employed as a registered representative with a registered broker-dealer, J.J. Morgan & Co., a brokerage firm later known as First Cambridge Securities Corp., Orr received undisclosed compensation for selling stock of ICIS Management Group, Inc., a Florida corporation, and Pilot Transport Inc., a Nevada corporation. In addition, the Division of Enforcement alleges that on November 10, 1999, the Commission commenced an action against Orr and sixteen other defendants, charging Orr with violations of Section 17(a) of the Securities Act of 1933 (Securities Act) and Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder, in connection with the kickback scheme described herein. SEC v. Curtis, et al., 99 Civ. 7357 (E.D.N.Y.). Further, the Division of Enforcement alleges that on September 13, 2002, the United States District Court for the Eastern District of New York entered a Final Judgment of Permanent Injunction and Other Relief as to Orr in the Commission's civil action, permanently enjoining Orr from future violations of Section 17(a) of the Securities Act, and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, ordering Orr to disgorge $55,000 in ill-gotten gains, approximately $44,000 in prejudgment interest, and post-judgment interest, and ordering Orr to pay a civil penalty of $55,000. Orr consented to the entry of the final judgment without admitting or denying the allegations in the Commission's Complaint.
A hearing will be scheduled before an administrative law judge to determine whether the allegations contained in the order are true, to provide the respondent an opportunity to dispute these allegations, and to determine what remedial sanctions, if any, are appropriate and in the public interest. The Commission directed that the Administrative Law Judge issue an initial decision no later than 210 days from the date of service of the order, pursuant to Rule 360(a)(2) of the Commission's Rules of Practice.
See also the Order in this matter