U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23513 / April 8, 2016
Securities and Exchange Commission v. Clarke Bethancourt, et al., Civil Action No. 13-cv-3074 (S.D.N.Y.)
SEC Obtains Settlement in Kickback Scheme to Secure Business of Venezuelan Bank
The Securities and Exchange Commission announced today that, on April 6 and 7, 2016, Judge Jesse M. Furman of the United States District Court for the Southern District of New York entered final judgments against defendants Iuri Rodolfo Bethancourt, Benito Chinea, Tomas Alberto Clarke Bethancourt, Joseph DeMeneses, Jose Alejandro Hurtado, Ernesto Lujan, and Haydee Leticia Pabon.
The judgments permanently enjoined all defendants from violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and ordered defendants Chinea, Clarke, DeMeneses, Hurtado, and Lujan to pay $42,506,171 in disgorgement and prejudgment interest. The disgorgement and prejudgment interest ordered by the judgment was deemed satisfied by forfeiture orders in entered in parallel criminal cases brought against the defendants by the United States Attorney's Office for the Southern District of New York.
According to the SEC's second amended complaint filed in federal court in Manhattan, the global markets group at broker-dealer Direct Access Partners executed fixed-income trades for customers in foreign sovereign debt. DAP Global generated more than $66 million in revenue for DAP from transaction fees - in the form of markups and markdowns - on riskless principal trade executions in Venezuelan sovereign or state-sponsored bonds for Banco de Desarrollo Econ³mico y Social de Venezuela (BANDES). A portion of this revenue was illicitly paid to a BANDES Vice President of Finance who authorized the fraudulent trades.
The SEC appreciates the assistance of the U.S. Attorney's Office for the Southern District of New York, the Department of Justice's Criminal Division, and the Federal Bureau of Investigation.
For further information, see Press Release 2013-84 (May 7, 2013), Press Release 2013-109 (June 12, 2013), and Press Release 2014-74 (April 14, 2014).
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