U.S. Securities and Exchange Commission

LITIGATION Release No. 16514 / April 12, 2000

Securities and Exchange Commission v. Mark K. Curry and Joseph H. Curry, U.S. District Court for the Eastern District of Michigan (Civil Action No. 97-74524) (Roberts)

SECOND CURRY BROTHER SENTENCED TO PRISON FOLLOWING THEFTS FROM CARACO PHARMACEUTICAL LABORATORIES, LTD.

The Securities and Exchange Commission and the U.S. Attorney's office announced that on April 10, 2000, the Honorable Roger G. Strand, an Arizona federal judge sentenced Joseph Curry to 5 months incarceration, 5 months house arrest, 3 years supervised release, and 200 hours of community service. Joseph Curry's sentence follows his brother Mark Curry's December 3, 1999 sentence of 27 months incarceration. Both Curry brothers entered guilty pleas to criminal informations alleging one count each of tax evasion and bank fraud. The U.S. Attorney's office for the Eastern District of Michigan filed the informations, and the U.S. Attorney's Office for the District of Arizona handled the sentencing of Joseph Curry.

The Currys' guilty pleas arose out of the same misconduct that was the basis for the Commission's 1997 civil action alleging securities law violations. The Commission's complaint alleged that during 1993 and 1994, Mark Curry, then controller of Caraco, a Detroit public company, and his brother, Joseph, stole at least $889,000 of Caraco funds by forging checks drawn on Caraco bank accounts and against Caraco credit accounts and by stealing checks issued to Caraco by its customers. As a result, the complaint alleged, Caraco's financial statements included in its 1993 registration statement and annual report and its 1994 quarterly reports were materially false and misleading. See Lit. Rel. 15470 (September 4, 1997).

On February 2, 1999, Judge Victoria M. Roberts, a Michigan federal judge, granted the Commission judgments by default against Mark and Joseph Curry finding them liable for the theft of Caraco corporate funds and ordering that:

• The Currys collectively must pay disgorgement totaling approximately $885,000 and prejudgment interest of approximately $420,000.

• Mark Curry must pay a penalty of $100,000, and Joseph Curry must pay a penalty of $50,000.

• Mark Curry is permanently prohibited from serving as an officer or director of any company registered with or Commission pursuant to Section 12 of the Exchange Act or filing reports with the Commission pursuant to Section 15 of the Exchange Act.

• Mark Curry is enjoined from future violations of Section 17(a) of the Securities Act of 1933, Sections 10(b) and 13(b)(5) of the Securities Exchange Act of 1934, and Rules 10b-5, 13b2-1, 13b2-2.

• Joseph Curry is enjoined from future violations of Section 13(b)(5) of the Exchange Act and Rule 13b2-1, and from aiding and abetting future violations of Section 17(a) of the Securities Act.

http://www.sec.gov/litigation/litreleases/lr16514.htm