U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21874 / March 7, 2011
Securities and Exchange Commission v. Anthony Fareri, Fareri Financial Services, Inc. d/b/a Amerifinancial, and Anthony Fareri & Associates, Inc., Civil Action No. 09-80360-CIV (S.D. Fla., March 3, 2009)
Court Enters Final Judgment against Anthony Fareri and Fareri Financial Services
On February 28, 2011, the United States District Court for the Southern District of Florida entered judgments by default against defendants Anthony Fareri, Fareri Financial Services d/b/a Amerifinancial, and Relief Defendant Anthony Fareri & Associates, Inc. The district court’s order enjoins Fareri and Fareri Financial Services from violating Section 17(a) of the Securities Act, Section 10(b) of the Securities Exchange Act and Rule 10b-5 thereunder. The order also enjoins defendant Fareri Financial Services, a broker-dealer controlled by Fareri, from violating Section 15(c)(1) of the Securities Exchange Act. As part of the court’s judgment, Fareri is subject to a disgorgement order requiring him to pay either individually or jointly-and-severally a combined total of $1,840,703 plus prejudgment interest of $667,031.73 for a grand total of $2,507,734.73. Under the order, Fareri Financial Services is jointly and severally liable for $160,703.74 of the disgorgement and Anthony Fareri & Associates is jointly and severally liable for $820,000 in disgorgement plus prejudgment interest of $297,150.61 for a total of $1,117,150.61. The district court also imposed a civil penalty in the amount of $100,000 on Fareri and permanently barred him from participating in the offering of penny stocks.
In its complaint against the defendants, the Commission alleged that in 2004 and 2005:
According to the complaint, the two shell companies were Secure Solutions Holdings, Inc. (SSLX) and American Financial Holdings, Inc. (AFHJ). Each traded on the over-the-counter market and was quoted on the Pink Sheets. Fareri pleaded guilty to mail fraud and Harary pleaded guilty to conspiracy to commit mail and wire fraud in parallel criminal actions brought the U.S. Attorney’s Office for the District of Columbia.
The Commission acknowledges the assistance of the U.S. Attorney's Office for the District of Columbia, the Federal Bureau of Investigation, the United States Postal Inspection Service, NASD (now known as the Financial Industry Regulatory Authority), and the British Columbia Securities Commission.
See also: Litigation Release No. 20931 http://www.sec.gov/litigation/litreleases/2009/lr20931.htm
The Commission has published guidance for investors concerning investments in microcap stocks. See: http://www.sec.gov/investor/pubs/microcapstock.htm.