U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 19055 / January 27, 2005
SECURITIES AND EXCHANGE COMMISSION V. TERESA V. FERNANDEZ, 96 Civ. 8702 (S.D.N.Y.)(JES)
TERESA V. FERNANDEZ IS CHARGED WITH MAKING FALSE STATEMENTS TO THE SEC
The Securities and Exchange Commission announced yesterday that a federal grand jury in the Southern District of New York has handed up an indictment charging Teresa V. Fernandez with making false statements to the Commission in violation of 18 United States Code, Section 1001. The United States Attorney's Office for the Southern District of New York is prosecuting the criminal case.
The indictment charges that, in connection with a settlement offer the Commission accepted in September, 2000, Fernandez falsely and fraudulently failed to disclose the existence of a trust fund she controlled at Barclays Private Bank & Trust, Isle of Man.
On November 19, 1996, the Commission filed a complaint in the United States District Court for the Southern District of New York charging that Fernandez â" an investment adviser â" misappropriated at least $64,036,612 of her clients' funds, SEC v. Fernandez, 96 Civ. 8702 (S.D.N.Y)(JES). On November 21, 1996, Fernandez consented to the entry of a permanent injunction, without admitting or denying the Commission's allegations, barring her from violating the antifraud provisions of the securities laws. On August 21, 1997, the Commission entered an order barring Fernandez from association with any broker, dealer, investment adviser, investment company or municipal securities dealer.
On January 2, 2001, the district court entered a final judgment on consent against Fernandez, holding her liable for disgorgement of $2,844,883, representing ill-gotten gains Fernandez received as a result of the conduct alleged in the complaint, plus pre-judgment interest thereon. However, under the terms of the consent judgment, payment of all but approximately $1,000,000 of that amount was waived, and no civil penalties were imposed, based on a sworn declaration of financial condition which Fernandez submitted to the Commission. The criminal charges filed against Fernandez today allege Fernandez failed to disclose the existence of a trust fund at Barclays Private Bank & Trust, Isle of Man, in her declaration of financial condition.
On November 19, 1996 Fernandez also pleaded guilty to three counts of mail fraud for the same conduct underlying the Commission's civil action. She was sentenced to four years probation, including one year of home confinement, and ordered to pay $21,768,489 in restitution.
For further information, see Litigation Release No. 15159 (November 19, 1996); Release No. IA 1650 (August 21, 1997); Litigation Release No. 16608 (June 26, 2000); and Litigation Release No. 16800 (November 15, 2000).