U. S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21324 / December 4, 2009
SEC v. Canopy Financial, Inc. and Jeremy J. Blackburn, Case No. 09-CV-7429, USDC, N.D.Ill.
SEC OBTAINS ASSET FREEZE AGAINST CANOPY FINANCIAL, INC.
CO-FOUNDER IN LAWSUIT ALLEGING $75 MILLION OFFERING FRAUD AND MISAPPROPRIATION OF INVESTOR FUNDS
The U.S. Securities and Exchange Commission (Commission) announced that fraud charges, a TRO and Asset Freeze Order imposed against Jeremy J. Blackburn were unsealed on December 2, 2009, by the Honorable Blanche M. Manning in the U.S. District Court for the Northern District of Illinois. The orders were entered on November 30, 2009. Jeremy J. Blackburn, a co-founder and former President and Chief Operating Officer of privately-held Canopy Financial, Inc. (Canopy), is charged with engaging in a scheme to defraud investors in a $75 million private placement offering and misappropriating investor funds. The Commission’s Complaint seeks, among other things, permanent injunctions against Blackburn and Canopy, which provides services to clients for the administration and management of their employees’ health services and flexible spending accounts. Canopy is headquartered in Chicago, IL and has other offices in San Francisco, CA and Plainsboro, NJ.
Filed on November 30, 2009 in an emergency action, the Commission’s Complaint alleges:
In addition to seeking permanent injunctions against Blackburn and Canopy for violating the antifraud provisions of the Securities Act of 1933 [Section 17(a)] and the Securities Exchange Act of 1934 [Section 10(b) and Rule 10b-5 thereunder], the Commission’s Complaint seeks the disgorgement of ill-gotten gains, plus prejudgment interest thereon, and civil penalties.