U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 17693 /August 21, 2002
SECURITIES AND EXCHANGE COMMISSION v. JOHN C. WILLY, JR., Civil Action No. EDCV 01-00979-VAP (SGLx)
SEC OBTAINS $4.5 MILLION JUDGMENT AGAINST SOUTHERN CALIFORNIA MAN RUNNING OVERSEAS INVESTMENT SCAM
On July 22, 2002, the Securities and Exchange Commission was awarded judgment in the amount of $4,498,634 against John C. Willy, Jr., a resident of San Bernardino, California, for his fraudulent offer and sale of unregistered securities in a nonexistent overseas investment program promising profits of 100% per month.
Final judgment was entered against Willy by the Honorable Virginia A. Phillips, United States District Judge for the Central District of California, Eastern Division, pursuant to the Court's order of July 10, granting in full the Commission's motion for summary judgment.
In addition to ordering disgorgement of $2,403,634 in ill-gotten gains, including interest, the Court assessed the maximum penalty allowed by law of $2,095,000 for Willy's violations of the securities registration and antifraud provisions of 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 and Rule 10b-5 thereunder, and permanently enjoined him from further violations of the antifraud and registration provisions of the federal securities laws.
The court found that Willy offered and sold more than $4.5 million of unregistered securities to two investor groups on behalf of Temperance Investments Ltd., a Gibraltar company. Willy, a Temperance director, represented to the investors that Temperance would place investor monies in a "high yield investment program" earning profits of 100% per month. In fact, the purported investment program did not exist. Instead, investor monies were transferred to a series of bank and brokerage accounts managed and controlled by Willy and misappropriated by Willy for his personal use.