U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 20462 / February 21, 2008
Securities and Exchange Commission v. Vincent A. Lenarcic, Jr. and New Vision Investment Funds, LLC, Defendants, and QMA Investment Management, LLC, Relief Defendant, Civil Action No. 3:05-CV-487 (W.D.N.C.)
The Securities and Exchange Commission ("Commission") announced today that on February 20, 2008, the Honorable Martin Reidinger, United States District Judge for the Western District of North Carolina, entered a Final Judgment against Vincent A. Lenarcic, Jr. and New Vision Investment Funds, LLC ("New Vision"). The order permanently enjoined the defendants 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. The court also ordered Lenarcic to pay disgorgement in the amount of $808,274.35, but that payment of disgorgement shall be deemed satisfied by the order of restitution in the parallel criminal action captioned United States v. Vincent A. Lenarcic, Jr., Cr. No. 3:06CR155-01 (W.D.N.C.). Further, the court ordered that the claim against relief defendant QMA Investment Management, LLC, is dismissed with prejudice. The defendants consented to the order without admitting or denying any of the allegations of the Commission's Complaint.
The Complaint charged Lenarcic and New Vision with securities and investment adviser fraud in connection with the sale of securities held by Fundamental Growth Investors, LP ("Fundamental"). The Complaint alleged that from June 2000 to December 2003, Lenarcic of Charlotte, NC, and New Vision, a limited liability company located in Charlotte, misappropriated at least $807,000 by selling securities in Fundamental's account and funneling the proceeds to New Vision and QMA, investment advisers controlled by Lenarcic. The Complaint further alleged that the funds were misappropriated and spent in a manner contrary to the representations made to Fundamental's investors in Fundamental's offering materials. The Complaint also alleged that Lenarcic and New Vision, in violation of their fiduciary duties to their advisory clients, misled, and failed to disclose their actions to the Fundamental investors.
See also: L.R. 19478 (November 30, 2005)