U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 18617 / March 9, 2004
SEC v. TELnetgo2000, Inc. et al., Docket No. CIV 01-1822PHXSRB (U.S.D.C., D. Ariz.)
On March 5, 2004, the Honorable Susan R. Bolton, U.S. District Court, District of Arizona, ordered a permanent injunction against Telnetgo2000, Inc. ("Telnet") and Wayne E. Mullins ("Mullins") from future violations of the antifraud and issuer reporting provisions of the federal securities laws and imposed a civil penalty against Mullins. The judgment was issued after a trial on the merits of the case.
The Securities and Exchange Commission filed a compliant against Telnet and Mullins on September 26, 2001 alleging that Telnet and Mullins made material misrepresentation and unreasonable projections of revenues and earnings in a series of quarterly and annual filings with the Commission and in private placement memorandum through which the company raised approximately $1 million form investors. The complaint alleged that by engaging in such conduct Telnet and Mullins violated Section 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 that Mullins aided and abetted Telnet in violating Section 13(a) of the Exchange Act and Rules 12b-20, 13a-1 and 13a-13 thereunder.
The order against Telnet prohibits violations of Section 17(a) of the Securities Act and Sections 10(b), and 13(a) of the Exchange Act and Rules 10b-5, 12b-20, 13a-1 and 13a-13 promulgated thereunder. The order against Mullins prohibits violations of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rules 10b-5 promulgated thereunder. The order also prohibits Mullins from engaging in aiding and abetting violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-1 and 13a-13 thereunder and orders Mullins to pay a civil penalty of $110,000.