SECURITIES AND EXCHANGE COMMISSION
Investment Advisers Act of 1940
Release No. 2171 / September 15, 2003
Admin. Proceeding File No. 3-11259
In the Matter of Michael Batterman and Randall B. Batterman III
The Securities and Exchange Commission ("Commission") announced today that it issued an Order Instituting Public Administrative Proceedings Pursuant to Section 203(f) of the Investment Advisers Act of 1940 ("Order") against Michael Batterman ("M. Batterman") and Randall Batterman ("R. Batterman"), both residents of Hackensack, New Jersey. In the Order, the Division of Enforcement alleges that the United States District Court for the Southern District of New York has issued permanent injunctions against M. Batterman and R. Batterman, and found them liable for using fraudulent misrepresentations and omissions of material fact to defraud five investors, who were M. Batterman's advisory clients, into purchasing at least $925,000 of the securities of Dynasty Fund Ltd., ("Dynasty"), an open-end investment management company controlled by M. Batterman.
The Commission instituted this administrative proceeding after the District Court entered a final judgment against M. Batterman and R. Batterman: (1) permanently enjoining them from future violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 ("Advisers Act"); (2) ordering M. Batterman and R. Batterman each to disgorge $837,182, consisting of $475,000 in funds misappropriated from investors plus prejudgment interest of $362,182; and (3) imposing on each a civil penalty of $250,000. Securities and Exchange Commission v. Michael Batterman, et al., 00 Civ. 4835 (S.D.N.Y) (LAP).
A hearing will be scheduled before an administrative law judge to determine whether the allegations contained in the Order are true, to provide Respondents an opportunity to dispute these allegations, and to determine what, if any, remedial sanctions against M. Batterman and R. Batterman are appropriate and in the public interest pursuant to Section 203(f) of the Advisers Act.