U.S. Securities and Exchange Commission
Litigation Release No. 18359 / September 23, 2003
SEC Files Subpoena Enforcement Action against Gary C. Halbert, Cherrywood Publishing, Inc. and Others
Securities and Exchange Commission v. Gary C. Halbert, et al. (United States District Court for the District of Massachusetts, 03-MBD-10284-RWZ)
The Securities and Exchange Commission today filed an action in Massachusetts federal court to enforce investigative subpoenas against Gary C. Halbert, Bond Halbert, Cherrywood Publishing, Inc. ("Cherrywood"), and John Doe (a/k/a Cherrywood's Keeper of Records"). The Commission alleges in its application filed with the court that Gary C. Halbert, Bond Halbert, Cherrywood, and Cherrywood's Keeper of Records failed to comply with administrative subpoenas requiring them to produce documents and testify in connection with an investigation to determine whether they and others may have violated the antifraud provisions of the Securities Exchange Act of 1934 and the Investment Advisers Act of 1940.
In its application and supporting papers, the Commission alleges that, on August 12, 2003, the Commission issued a formal order of private investigation entitled In the Matter of Cherrywood Publishing, Inc., File No. B-01967 ("Formal Order"). The Formal Order directed the Commission staff to undertake a private investigation to determine if there were violations of the federal securities laws. According to the Commission's court papers, the Commission staff is investigating possible material false statements concerning a stock trading system made by or on behalf of Gary C. Halbert and Cherrywood in newspaper advertisements that appeared in USA Today and on a website purportedly operated by Gary C. Halbert.
According to the application, the Commission staff issued subpoenas to Gary C. Halbert, Bond Halbert, Cherrywood, and Cherrywood's Keeper of Records on August 12, 2003 and issued a second subpoena to Bond Halbert on August 20, 2003, requiring them to produce documents and testify concerning matters relevant to the investigation. As of September 23, 2003, the Commission alleges that the parties have not produced the responsive documents and have not testified as compelled by the subpoenas.