SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 16317 / September 30, 1999
SEC v. TODD HANSEN AND NICHOLAS LOBUE (U.S.D.C. N.D. Ill. Civil Action No. 99 C 6386 Filed September 28, 1999)
The Securities and Exchange Commission ("Commission") announced that on September 28, 1999, the Commission filed a Complaint in the United States District Court for the Northern District of Illinois against Todd Hansen ("Hansen") and Nicholas LoBue ("LoBue") alleging violations of the antifraud provisions of the federal securities laws. The Commission's Complaint alleges that on or about December 1996 through approximately June 1997, Hansen and LoBue raised about $660,000 from investors and that Hansen and LoBue misappropriated approximately $234,000 which was to be used for trading and which instead was directed to other entities in which LoBue had ownership interests. The Complaint also alleges that Hansen and LoBue sent investors false account statements showing trading profits instead of losses. Furthermore, the Complaint alleges that Hansen and LoBue made misrepresentations and failed to state material facts about Hansen's prior convictions for theft and state securities laws violations, the fact that he pled guilty to insurance fraud and his actual employment status with Pavilion Securities.
The complaint seeks, among other things, an order permanently enjoining Hansen and LoBue from future violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder as well as disgorgement, prejudgment interest and civil penalties.