U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 19461 / November 9, 2005
SECURITIES AND EXCHANGE COMMISSION v. LEARN WATERHOUSE, INC.; RANDALL TREADWELL; RICK D. SLUDER; LARRY C. SATURDAY; AND ARNULFO M. ACOSTA, Civil Action No. 04-CV-2037W (LSP) (S.D.Cal.)
SEC OBTAINS THIRD ORDER REQUIRING DEFENDANT RANDALL T. TREADWELL TO SHOW CAUSE WHY HE SHOULD NOT BE HELD IN CIVIL CONTEMPT
On October 24, 2005, the Honorable Thomas J. Whelan, United States District Judge for the Southern District of California, issued an order to defendant Randall T. Treadwell, age 47, of Savannah, Georgia, to show cause why he should not be held in civil contempt for violating the court's preliminary orders freezing his assets. This is the third such order issued by the court against Treadwell. According to the Commission's latest contempt application, Treadwell withdrew more than $506,000 from a bank account that was subject to the court's orders that froze all of the defendants' assets.
The court's order requires Treadwell to appear on December 5, 2005 and show cause why an order of civil contempt should not be issued and why he should not be incarcerated pending his compliance with the court's orders including identification and surrender of all assets from the bank account from which the dissipation of assets occurred.
On October 12, 2004, the Commission filed a complaint against Treadwell, Rick D. Sluder, Larry C. Saturday, Arnulfo M. Acosta, and Learn Waterhouse, Inc., alleging that they had raised millions from 1700 investors in a nationwide Ponzi scheme. On November 1, 2004, Thomas Lennon was appointed as the permanent receiver over Learn Waterhouse and given authority over all of its assets. The court also ordered the defendants to repatriate all assets from abroad, and issued a preliminary injunction prohibiting all of the defendants from future violations of the antifraud and registration provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. On February 23, 2005 and October 17, 2005, the court issued orders finding Treadwell in civil contempt. Treadwell is the former chairman, president and chief operating officer of Learn Waterhouse, a Texas corporation, which allegedly operated a fictitious prime bank trading program.
In addition to the relief already obtained, the Commission seeks permanent injunctions, disgorgement and civil penalties from all of the defendants.
For further information, see Litigation Release Nos. 18932 (October 14, 2004), 18959 (November 4, 2004), 19059 (February 1, 2005), 19142 (March 17, 2005), 19384 (September 20, 2005), and 19412 (October 4, 2005).