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U.S. Securities and Exchange Commission

UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

Securities Exchange Act of 1934
Release No. 50515 / October 12, 2004

Admin. Proc. File No. 3-11704


In the Matter of

LARRY F. SMATH,

Respondent.



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ORDER INSTITUTING ADMINISTRATIVE PROCEEDINGS PURSUANT TO SECTION 15(b) OF THE SECURITIES EXCHANGE ACT OF 1934, MAKING FINDINGS, AND IMPOSING REMEDIAL SANCTIONS

I.

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 Larry F. Smath ("Respondent").

II.

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 him and the subject matter of these proceedings, and the findings contained in Section III.2 and III.4 below, which are admitted, Respondent consents 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.

III.

On the basis of this Order and Respondent's Offer, the Commission finds that:

1. At the time of the alleged misconduct, Smath was a registered representative at Renaissance Financial Securities, Inc., a broker-dealer registered with the Commission. Smath, 47 years old, is a resident of Levittown, NY.

2. On December 16, 2003, a final judgment was entered by consent against Smath, permanently enjoining him from future violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, in the civil action entitled Securities and Exchange Commission v. Larry F. Smath, et al., Civil Action Number CV-99-523, in the United States District Court for the Eastern District of New York.

3. In the civil injunctive action described above, the Commission's Complaint alleged, inter alia, that Smath engaged in insider trading involving nonpublic advance copies of the "Inside Wall Street" ("IWS") column of Business Week magazine. Specifically, the Commission alleged that Smath and others paid another defendant in exchange for communicating the contents of the IWS columns to them before the columns were made public, and that Smath traded securities while in possession of the nonpublic information obtained from the IWS columns. The Commission's Complaint also alleged that Smath communicated the contents of the IWS columns to others who in turn recommended those securities to their brokerage customers, while in possession of the nonpublic contents of the IWS columns.

4. On November 1, 1999, Smath pleaded guilty to one count of conspiracy to commit securities fraud and one count of mail fraud in violation of Title 18 United States Code, Sections 371 and 1341 before the United States District Court for the Eastern District of New York, in United States v. Larry F. Smath, 99 Cr.0001 and 1008 (TCP). On September 26, 2002, the Court sentenced Smath to unsupervised probation for one month and a $100 special assessment.

5. The counts of the criminal information to which Smath pleaded guilty alleged, inter alia, that Smath defrauded the securities markets by trading while in possession of material nonpublic information.

IV.

In view of the foregoing, the Commission deems it appropriate and in the public interest to impose the sanctions agreed to in Respondent Smath's Offer.

Accordingly, it is hereby ORDERED:

Pursuant to Section 15(b)(6) of the Exchange Act, that Respondent Smath 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.

By the Commission.

Jonathan G. Katz
Secretary


http://www.sec.gov/litigation/admin/34-50515.htm


Modified: 10/12/2004