U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23633 / September 1, 2016
Securities and Exchange Commission v. Jilbert Tahmazian, Esq., Case No. 2:16-CV-954 (C.D. Cal. filed February 11, 2016); In the Matter of Jilbert Tahmazian, Esq., Administrative Proceeding No. 3-17524 (Sept. 1, 2016)
California Attorney Settles SEC Charges That He Participated in Prime Bank Fraud Scheme
On August 26, 2016, the U.S. District Court for the Central District of California entered a final judgment against Jilbert Tahmazian, an attorney licensed in California, ordering him to pay $196,524 to settle an antifraud action filed by the SEC.
The SEC's complaint alleged that, from at least mid-2009 through at least December 2010, Tahmazian and two of his clients engaged in a fraudulent, "prime bank" scheme and obtained approximately $6 million from four investors who invested in fictitious investment contracts. According to the complaint, investors were promised that they would receive a return of 15% to 30% per week from their investment and that if the funds were not invested within 15 to 30 days, they would receive a refund of their investment plus a 2% penalty. To the contrary, investors' funds were neither invested nor returned as promised. Instead, after keeping a 2% fee for himself, Tahmazian transferred the money to his clients and others, who in turn spent it at Las Vegas casinos and high-end retail stores.
Without admitting or denying the facts as alleged, Tahmazian consented to the entry of a final judgment that permanently enjoins him from violating Sections 5(a), 5(c), 17(a)(1), and 17(a)(3) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934, and Rules 10b-5(a) and (c) thereunder, and orders him to disgorge ill-gotten gains of $40,000 plus prejudgment interest of $6,524, and pay a civil penalty of $150,000.
As a result of the injunction, in a related settled administrative proceeding instituted today, Tahmazian agreed to the entry of an order permanently suspending him from appearing and practicing before the SEC as an attorney. The order prohibits Tahmazian from representing clients in SEC matters, including investigations, litigation, or examinations, and from advising clients about SEC filing obligations or content.
For further information on this action, please see Litigation Release No. 23465 (Feb. 11, 2016).