U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 20184 / July 9, 2007
SEC v. Graham J. Lefford, 06-CIV-7716 (DAB) (SDNY)
Former Butler to Entertainment Industry Entrepreneur Consents to Injunction and Agrees to Disgorge Insider Trading Profits and Pay a Civil Penalty
The Securities and Exchange Commission announced today that defendant Graham J. Lefford, a former butler to entertainment industry entrepreneur Robert F.X. Sillerman, has agreed to settle the insider trading charges pending against him. Without admitting or denying the allegations in the Commission's complaint, Lefford consented to the entry of a final judgment enjoining him from violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Lefford further consented to disgorge his trading profits of $31,450, plus prejudgment interest of $3,280, and pay a penalty of $31,450.
According to the Commission's complaint filed on September 26, 2006, in the United States District Court for the Southern District of New York, Lefford engaged in unlawful insider trading while employed as the house manager for Sillerman's South Hampton, New York residence. The Commission's complaint alleges as follows: In the summer of 2004, Sillerman, an entertainment industry entrepreneur, was in the process of negotiating the acquisition of a controlling interest in a publicly-traded company named Sports Entertainment Enterprises, Inc. ("SPEA") to use as the vehicle for acquiring the commercial rights to Elvis Presley's name and likeness. Lefford learned material non-public information about Sillerman's intended acquisition of SPEA from one or more documents faxed between Sillerman's office in Manhattan and his South Hampton residence. On August 12, 2004, Lefford used that information to purchase 5,000 shares of SPEA stock at 12 cents per share. Sillerman's acquisition of SPEA and SPEA's concurrent acquisition of the commercial rights to Elvis Presley name and likeness were jointly announced on the morning of December 16, 2004, and SPEA stock closed at $6.41 that day, an increase of over 6,400% from the prior day.
For additional information see: Litigation Release No. 19845 (September 26, 2006)