SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 16560 / May 22, 2000
SECURITIES AND EXCHANGE COMMISSION v. LARRY W. ELLIS, Civil Action No. 3-00CV1040-P
On May 17, 2000, Judge Jorge Solis granted the Commission's Ex Parte Application for Temporary Restraining Order and Other Equitable Relief against Larry W. Ellis (Ellis) d/b/a ATM Technology Systems. The Commission accuses Ellis of falsely claiming that the ATM investments he offered were safe and would provide lucrative returns. In reality, after making a few payments on these investments, Ellis typically ceased paying investors.
The complaint alleges that Ellis raised approximately $1 million from investors by representing, among other things, that:
These representations were false and misleading.
In reality, Ellis' involvement with ATMs was merely an agreement that he entered in 1996 with an established ATM service provider to find lease locations for its machines. Further, Ellis defaulted on this agreement, and in June 1998, a $250,000 default judgement was entered against him.
The Complaint charges that Ellis violated the antifraud provisions found in Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder, and seeks a temporary restraining order, preliminary and permanent injunctions, an asset freeze, accounting, disgorgement with prejudgment interest and civil penalties. The complaint also seeks an order prohibiting the movement, alteration and destruction of books and records and an order expediting discovery. [Securities and Exchange Commission v. Larry W. Ellis, d/b/a ATM Technology Systems, U.S.D.C./Northern District of Texas/Dallas Division Civil Action No. 3-00CV1040-P]