UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Litigation Rel. No. 17965 / February 4, 2003
Commission Files Civil Contempt Charges Against
SEC v. Claude Lefebvre et al. (United States District Court for the Northern District of California, C.A. No. C-02-3704-JSW)
The Commission announced that, on January 31, 2003, it filed civil contempt charges against Watch Hill Capital Management LLC, alleging that the company violated a federal court order issued in a civil fraud case filed by the Commission. On July 31, 2002, the Commission filed a complaint in federal court in California alleging that Watch Hill and others participated in a fraudulent "prime bank" scheme that raised at least $40 million from investors in July 2002. The United States District Court for the Northern District of California issued a temporary restraining order ("TRO") and asset freezes against Watch Hill and others on August 1, 2002, and converted the TRO to a preliminary injunction on October 15, 2002. In its contempt application, the Commission alleges that Watch Hill has failed to comply with the court's order in the TRO and preliminary injunction requiring Watch Hill to identify, among other things, its financial institution accounts and investors or clients from whom it received funds.
The Commission previously filed contempt charges against two of Watch Hill's co-defendants, Claude Lefebvre and RMO Assets Management SA, on September 30, 2002. For further information, please see Litigation Release Numbers 17793 (October 18, 2002)[preliminary injunction against Watch Hill and others]; 17759 (October 1, 2002)[contempt charges against Lefebvre and RMO Assets Management]; 17729 (September 17, 2002)[Lefebvre charged by criminal authorities and incarcerated]; and 17652 (August 2, 2002)[Commission obtains TRO and asset freeze].