SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 16174 / June 4, 1999
Federal Judge Permanently Enjoins Raymond C. OBrien In Internet Related Fraudulent Stock Sales Scheme
Securities and Exchange Commission v. Green Oasis Environmental, Inc., William D. Carraway, Raymond C. OBrien and Ronald V. Reece, Defendants, and Mary Ann Carraway, Relief Defendant. Civil Action No. 2:98-1913-23 (D.S.C. May 28, 1999)
The Securities and Exchange Commission announced today that Judge Patrick Michael Duffy of the United States District Court for the District of South Carolina entered an Order of Permanent Injunction And Other Relief against Raymond C. OBrien ("OBrien") restraining and enjoining him from further violations of Sections 5(a), 5(c), 17(a) and 17(b) of the Securities Act of 1933 ("Securities Act") and Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder. OBrien consented to the entry of the permanent injunction without admitting or denying the allegations of the Commissions complaint. Further, the Court ordered disgorgement against OBrien in the amount of $892,761 but waived payment based upon OBriens demonstrated inability to pay. The Order did not impose a civil penalty based upon OBriens demonstrated inability to pay.
The Commissions complaint, filed on July 1, 1998, alleged that Green Oasis Environmental, Inc. ("Green Oasis") and William D. Carraway ("Carraway") published a series of false and misleading press releases prepared by the public relations firm the company retained, owned and controlled by OBrien. Carraway paid OBrien and others to publish purportedly objective descriptions about the company and to encourage positive discussion about the company in Internet news groups. Carraway and OBrien used these false press releases to increase investor interest in the company.
The complaint sought a permanent injunction against the defendants Green Oasis and Carraway to prevent their future violations of Sections 5(a), 5(c) and 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder; a permanent injunction against defendant OBrien to prevent his future violations of Sections 5(a), 5(c), 17(a) and 17(b) of the Securities Act, and Sections 10(b) and 15(a) of the Exchange Act and Rule 10b-5 thereunder; and a permanent injunction against defendant Ronald V. Reece ("Reece") to prevent his future violation of Section 17(b) of the Securities Act. The complaint further sought an disgorgement, prejudgment interest and civil penalties from defendants Carraway and OBrien and civil penalties from defendant Reece. The Commissions complaint also sought disgorgement from Mary Ann Carraway of the gains from her sales of Green Oasis securities. Judge Duffy previously entered Orders of Permanent Injunction against Green Oasis in August 1998 and against Reece in December 1998. Litigation is ongoing against Carraway and Mary Ann Carraway.
Investors are advised to read the SECs "Cyberspace" Alert before purchasing any investment promoted on the Internet. The free publication, which alerts investors to the telltale signs of online investment fraud, is available on the Investor Assistance and Complaints link of the SECs Home Page on the World Wide Web <www.sec.gov>. It can also be obtained by calling 800-SEC-0330. Investors are encouraged to report suspicious Internet offerings (or other suspicious offerings) via e-mail to <firstname.lastname@example.org>. A user-friendly form to assist you in making a report is available at the Enforcement Complaint Center on the Enforcement Division link of the SEC Home Page <www.sec.gov>. Investors can also mail a report to the SECs Enforcement Complaint Center, Mail Stop 8-4, 450 Fifth Street, Washington, D.C. 20549.
See also: L.R. 15864 (September 1, 1998); L.R. 15876 (September 9, 1998); L.R. 16032 (January 20, 1999)http://www.sec.gov/litigation/litreleases/lr16174.htm