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U.S. Securities and Exchange Commission

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 17663 /August 6, 2002

SECURITIES AND EXCHANGE COMMISSION FILES COMPLAINT ALLEGING THAT ARDIAN FINANCE GROUP CONDUCTED A FRAUDULENT UNREGISTERED OFFERING THAT RAISED OVER $1.2 MILLION FROM INVESTORS

SEC v. Ardian Finance Group et al. C.A. No. CV 02 4386 (E.D.N.Y.)

The Securities and Exchange Commission filed an emergency injunctive action today in the United States Court for the Eastern District of New York alleging that Ardian Finance Group ("Ardian") conducted a fraudulent unregistered offering that raised over $1.2 million from at least 70 investors. Vladislav Tartakovsky, the President of Ardian, orchestrated this fraudulent offering, and he retained Michael Yeninas and Michael Green to solicit investors to purchase Ardian securities. Ardian, Tartakovsky, Yeninas and Green all made material misrepresentations to investors to induce them to purchase Ardian securities. The Commission's complaint names the following defendants:

  • Ardian, a Delaware corporation, which has its principal place of business in Long Island City, New York. Ardian is purportedly in the business of providing short-term financing, including factoring and check-cashing services for small businesses.

  • Tartakovsky, age 31, a resident of Fair Lawn, New Jersey. Tartakovsky is the President of Ardian.

  • Yeninas, age 28, a resident of Queens, New York.

  • Green, age and residence unknown, who is purportedly a "Senior Financial Consultant" to Ardian.

Specifically, the Complaint alleges the following: From approximately October 2001 through the present, Tartakovsky orchestrated a fraudulent unregistered offering of Ardian securities through which Ardian raised approximately $1.2 million from at least 70 investors. To facilitate this Offering, Ardian and Tartakovsky retained Yeninas and Green and other salespersons to offer and sell Ardian securities to investors.

In connection with its Offering, Ardian provided private offering memoranda ("POM"), which Tartakovsky helped prepare, to investors. The POM contained material misrepresentations. For instance, Ardian claimed that it had a "matching fund commitment by an unrelated third party financing institution" to provide funds to finance Ardian's operations. This representation was false. Ardian had no such agreement. In its POM, Ardian also claimed that William Marconi ("Marconi") and Michael Rehzets ("Rehzets") were currently serving as officers and/or directors of Ardian. This representation too was false. To date, neither Rehzets nor Marconi has performed any functions for Ardian.

In connection with their efforts to solicit investors, Yeninas and Green also concocted a variety of purported facts to persuade investors to purchase Ardian securities. Among other things, Yeninas and Green told investors that (i) Ardian was planning an initial public offering ("IPO") on a date certain (i.e. July 2002), and (ii) investors could sell their stock the first day Ardian stock was publicly traded at a specific price (i.e. $5-7 per share), which was a significant premium over the $2.00 to $2.50 per share that the investor was paying to purchase the stock in the Offering. These representations were false. In fact, Ardian had not taken any steps to conduct an IPO.

Additionally, Yeninas told investors that Ardian was financing companies involved in the Ground Zero clean-up following the September 11, 2001 terrorist attacks. This representation was false. Ardian provided no such financing.

The Commission alleges that through this conduct, Ardian, Tartakovsky, Yeninas and Green violated Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934. Additionally, Green violated Section 15(a)(1) of the Exchange Act. In addition to expedited relief, including a temporary restraining order, the Commission is seeking permanent injunctions, and disgorgement and prejudgment interest against all of the defendants. The Commission is also seeking civil penalties against Tartakovsky, Yeninas and Green. Additionally, the Complaint names JBS Investments, Inc., a New Jersey corporation with its principal place of business in Brooklyn, New York, as a relief defendant.

For further information contact: Mark Schonfeld, Associate Regional Director (646) 428-1650 or Kay Lackey, Assistant Regional Director (646) 428-1790.


*  SEC Complaint in this matter.


http://www.sec.gov/litigation/litreleases/lr17663.htm

Modified: 08/07/2002