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U.S. Securities and Exchange Commission


Litigation Release No. 20864 / January 23, 2009

Accounting and Auditing Enforcement Release No. 2923 / January 23, 2009

Securities and Exchange Commission v. Ranko Cucuz, William D. Shovers, Jesus Bonilla-Valdez, Ronald Lee Kolakowski, and HLI Operating Company, Inc., f/k/a Hayes Lemmerz International, Inc., Civil Action No. 2: 06-CV-11935


The Securities and Exchange Commission announced today that the U.S. District Court for the Eastern District of Michigan entered final judgments against Ranko Cucuz, former CEO of Hayes Lemmerz International, Inc., and William D. Shovers, former CFO of Hayes, after a jury found that they had violated the securities laws in connection with an accounting scheme at the company. The judgments were entered on December 18 and 22, 2008, following a remedy hearing before the Honorable Arthur J. Tarnow, United States District Judge.

On December 22, 2008, Judge Tarnow entered final judgment against Shovers that imposed a civil monetary penalty of $50,000, enjoined him from violating the applicable antifraud and other provisions of the federal securities laws, and barred him from acting as an officer or director of a publicly traded company for a period of five years. On December 18, 2008, Judge Tarnow entered final judgment against Cucuz that imposed a $10,000 civil penalty and enjoined him from future violations of the applicable antifraud provision of the Securities Act of 1933.

Previously, on August 20, 2008, a jury found that Shovers violated: (i) the antifraud provisions of both the Securities Act (Section 17(a)(3)) and the Securities Exchange Act of 1934 (Section 10(b) and Rule 10b-5 thereunder); (ii) the internal controls and books and records provisions of the Exchange Act (Section 13(b)(5) and Exchange Act Rule 13b2-1); and (iii) the lying-to-auditor provision of the Exchange Act (Rule 13b2-2). The jury also found that Shovers aided and abetted violations of the issuer reporting, books and records, and internal control provisions of the Exchange Act (Sections 13(a), 13(b)(2)(A) and 13(b)(2)(B) and Exchange Act Rules 12b-20, 13a-1 and 13a-13). Finally, the jury found Cucuz liable for violations of the antifraud provisions of the Securities Act (Section 17(a)(3)). The jury found Cucuz not liable on other charges.

Cucuz and Shovers were the last two remaining defendants in this action. On January 14, 2007, the Court entered final judgment by consent against defendant Jesus Bonilla-Valdez (former Vice President of Hayes' Aluminum Wheel Group) that imposed a $30,000 civil penalty, and enjoined him from future violations of the antifraud, reporting, internal controls, and books and records provisions of the federal securities laws. As the Commission previously announced, Hayes and Ronald Kolakowski (former President of Hayes' North American Wheel Group) settled with the Commission at the time the complaint in this action was filed.

Moreover, in previously settled related administrative proceedings, the Commission issued Orders Instituting Administrative Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934, Making Findings and Imposing Remedial Sanctions against Allen Buntin, James Jarrett, and Greg Jones, all of whom were former employees of Hayes.

Additional information concerning this action and Commission actions related to this matter can be found at:

  • SEC v. Cucuz, et al., Civil Action No. 2:06 CV 11935 (E.D. Mich.) [Release No. LR-20686] (August 21, 2008)
  • SEC v. Cucuz, et al., Civil Action No. 2:06 CV 11935 (E.D. Mich. April 25, 2006) [Release No. LR-19668] (April 25, 2006).
  • In the Matter of James Jarrett [Release No. 34-53716] (April 25, 2006)
  • In the Matter of Allen Buntin [Release No. 34-53717] (April 25, 2006)
  • In the Matter of Greg Jones [Release No. 34-53718] (April 25, 2006)



Modified: 01/23/2009