U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 20391 / December 7, 2007
SEC v. Charles Agapiou, John Agapiou, Asimina Antonellis, Charles Artese, Rose Ercolano, Evangelos Hadjimichael, Karen Kerames, Elene Koutroumanis, Kellie Pappas, Kristine Pappas, Marie Sagnella, Rita Santini, Peter Spalthoff, and Corinne Tsakonas (United States District Court for the District of Connecticut, 07-MC-346-JBA)
Commission Files Subpoena Enforcement Action Against 14 New Haven Savings Bank Depositors
The Securities and Exchange Commission announced today that it filed an application on December 6, 20007, in the United States District Court for the District of Connecticut for orders to enforce investigative subpoenas served on Charles Agapiou, John Agapiou, Asimina Antonellis, Charles Artese, Rose Ercolano, Evangelos Hadjimichael, Karen Kerames, Elene Koutroumanis, Kellie Pappas, Kristine Pappas, Marie Sagnella, Rita Santini, Peter Spalthoff, and Corinne Tsakonas (collectively, "Respondents"), all of Connecticut. Each of the Respondents was a depositor of New Haven Savings Bank ("NHSB"), now known as NewAlliance Bancshares, Inc. ("NewAlliance"), based in New Haven, Connecticut.
The Commission's application and supporting papers allege that, on May 18, 2004, the Commission issued a formal order of private investigation authorizing its staff to investigate to determine whether there have been violations of the federal securities laws, including violations of the antifraud provision of the Exchange Act. Specifically, the Commission's papers allege that the staff has been investigating whether certain individuals or entities used depositors who were eligible to purchase NewAlliance stock at the time that NHSB converted from mutual to stock organization form as nominees to enable such individuals or entities to participate in the conversion in contravention of NewAlliance's prospectus. On July 17, 2006, the Commission issued investigative subpoenas to each of the 14 Respondents. The subpoenas required each Respondent to produce documents relevant to the investigation and to appear before the Commission staff for testimony. The Commission alleges that, despite a number of accommodations offered to Respondents through counsel, as of the date of its application, certain Respondents have failed to produce the subpoenaed documents and all of the Respondents have failed to appear for testimony. According to the Commission's application, none of the Respondents have a valid justification for their failure to comply with the subpoenas, and court orders are necessary to compel certain of them to produce the subpoenaed documents and to compel them all to appear for testimony.
The Commission alleges that Respondents were each depositors of NHSB who purchased shares of NewAlliance in its initial public offering with funds provided by an entity known as Old Financial LLC, a North Dakota limited liability company. The Commission further alleges that the documents and testimony sought are necessary to determine whether, as a result of the arrangement between the Respondents and Old Financial, there were any violations of the federal securities laws.
A hearing on the Commission's application has not yet been scheduled.