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COMMISSION ANNOUNCEMENTSSecurities and Exchange Commission Suspends Trading in the Securities of Seven Issuers for Failure to Make Required Periodic FilingsThe U.S. Securities and Exchange Commission announced the temporary suspension of trading in the securities of the following issuers, commencing at 9:30 a.m. EST on March 3, 2010, and terminating at 11:59 p.m. EDT on March 16, 2010.
The Commission temporarily suspended trading in the securities of these seven issuers due to a lack of current and accurate information about the companies because they have not filed periodic reports with the Commission in over two years. This order was entered pursuant to Section 12(k) of the Securities Exchange Act of 1934 (Exchange Act). The Commission cautions brokers, dealers, shareholders and prospective purchasers that they should carefully consider the foregoing information along with all other currently available information and any information subsequently issued by these companies. Brokers and dealers should be alert to the fact that, pursuant to Exchange Act Rule 15c2-11, at the termination of the trading suspensions, no quotation may be entered relating to the securities of the subject companies unless and until the broker or dealer has strictly complied with all of the provisions of the rule. If any broker or dealer is uncertain as to what is required by the rule, it should refrain from entering quotations relating to the securities of these companies that have been subject to a trading suspension until such time as it has familiarized itself with the rule and is certain that all of its provisions have been met. Any broker or dealer with questions regarding the rule should contact the staff of the Securities and Exchange Commission in Washington, DC at (202) 551-5720. If any broker or dealer enters any quotation which is in violation of the rule, the Commission will consider the need for prompt enforcement action. If any broker, dealer or other person has any information which may relate to this matter, they should immediately communicate it to the Delinquent Filings Branch of the Division of Enforcement at (202) 551-5466, or by e-mail at DelinquentFilings@sec.gov. (Rel. 34-61632) Securities and Exchange Commission Suspends Trading in the Securities of Seven Issuers for Failure to Make Required Periodic FilingsThe U.S. Securities and Exchange Commission announced the temporary suspension of trading in the securities of the following issuers, commencing at 9:30 a.m. EST on March 3, 2010, and terminating at 11:59 p.m. EDT on March 16, 2010.
The Commission temporarily suspended trading in the securities of these seven issuers due to a lack of current and accurate information about the companies because they have not filed periodic reports with the Commission in over two years. This order was entered pursuant to Section 12(k) of the Securities Exchange Act of 1934 (Exchange Act). The Commission cautions brokers, dealers, shareholders and prospective purchasers that they should carefully consider the foregoing information along with all other currently available information and any information subsequently issued by these companies. Brokers and dealers should be alert to the fact that, pursuant to Exchange Act Rule 15c2-11, at the termination of the trading suspensions, no quotation may be entered relating to the securities of the subject companies unless and until the broker or dealer has strictly complied with all of the provisions of the rule. If any broker or dealer is uncertain as to what is required by the rule, it should refrain from entering quotations relating to the securities of these companies that have been subject to a trading suspension until such time as it has familiarized itself with the rule and is certain that all of its provisions have been met. Any broker or dealer with questions regarding the rule should contact the staff of the Securities and Exchange Commission in Washington, DC at (202) 551-5720. If any broker or dealer enters any quotation which is in violation of the rule, the Commission will consider the need for prompt enforcement action. If any broker, dealer or other person has any information which may relate to this matter, they should immediately communicate it to the Delinquent Filings Branch of the Division of Enforcement at (202) 551-5466, or by e-mail at DelinquentFilings@sec.gov. (Rel. 34-61633) Securities and Exchange Commission Suspends Trading in Xtreme Motorsports International, Inc.The Securities and Exchange Commission announced the temporary suspension, pursuant to Section 12(k) of the Securities Exchange Act of 1934 (the Exchange Act), of trading of the securities of Xtreme Motorsports International, Inc. (Xtreme Motorsports), of Henderson, Nevada at 9:30 a.m. EST on March 3, 2010, and terminating at 11:59 p.m. EDT on March 16, 2010. The Commission temporarily suspended trading in the securities of Xtreme Motorsports because of questions that have been raised about the accuracy and adequacy of publicly disseminated information concerning trading in the company's stock. Xtreme Motorsports is quoted on the Pink Sheets under the symbol "XTMM." The Commission cautions brokers, dealers, shareholders, and prospective purchasers that they should carefully consider the foregoing information along with all other currently available information and any information subsequently issued by the company. Further, brokers and dealers should be alert to the fact that, pursuant to Rule 15c2-11 under the Exchange Act, at the termination of the trading suspension, no quotation may be entered unless and until they have strictly complied with all of the provisions of the rule. If any broker or dealer has any questions as to whether or not he has complied with the rule, he should not enter any quotation but immediately contact the staff in the Division of Trading and Markets, Office of Interpretation and Guidance, at (202) 551-5760. If any broker or dealer is uncertain as to what is required by Rule 15c2-11, he should refrain from entering quotations relating to Xtreme Motorsports' securities until such time as he has familiarized himself with the rule and is certain that all of its provisions have been met. If any broker or dealer enters any quotation which is in violation of the rule, the Commission will consider the need for prompt enforcement action. If any broker, dealer, or other person has any information which may relate to this matter, they should immediately contact Chedly C. Dumornay, Assistant Regional Director, Miami Regional Office of the Securities and Exchange Commission at (305) 982-6377. (Rel. 34-61634) ENFORCEMENT PROCEEDINGSIn the Matter of Ponta Negra Fund I, LLC; In the Matter of Francesco RuscianoOn Feb. 3, 2010, a federal court in Austin, Texas entered an agreed final judgment in the Commission's civil enforcement action, Securities and Exchange Commission v. Ponta Negra Fund I, LLC et al, Civil Action No. 1:09-cv-00324-SS (W.D. Tex). Without admitting or denying the allegations, Defendants Francesco Rusciano and three hedge funds he controlled consented to the entry of the final judgment that (i) permanently enjoins them from future violations of Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder, and Section 17(a) of the Securities Act of 1933; and (ii) orders disgorgement of $15,233,361.27 in ill-gotten gains, prejudgment interest of $190,292.02, and a third-tier civil penalty of $150,000. As a result, investors stand to receive an approximate 100% return of their principal. The Commission's complaint alleged that Rusciano and the three hedge funds misrepresented monthly and yearly performance results, overstated the amount of assets under management, forged documents and misrepresented Rusciano's historical trading success at UBS Securities. Separately, on March 2, 2010, the Commission issued an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934, Making Findings and Imposing Remedial Sanctions (Order) against Francesco Rusciano. The Order finds that the Federal Reserve System Board of Governors entered a Consent Order against Rusciano arising from alleged misconduct during his employment at UBS Securities. The Federal Reserve's Consent Order prohibits him from, among other actions, participating in any manner in the conduct of the affairs of any insured depository institution. Rusciano consented to the issuance of the Commission's Order without admitting or denying any of the findings, except as to the Commission's jurisdiction over him and the subject matter of these proceedings, and the findings contained in Section III.2 of the Commission's Order relating to the Federal Reserve System Board of Governors' action against him, which are admitted. The Order bars him from association with any broker or dealer. (Rel. 34-61631; File No. 3-13801) SEC Sues Verint for Improper Accounting Practices and Institutes Exchange Act Section 12(J) Administrative ProceedingsThe Securities and Exchange Commission today filed a civil action against Verint Systems Inc. (Verint) alleging a fraudulent scheme involving certain improper accounting practices. The Complaint alleges the misconduct began as early as 1998, when Verint was a wholly-owned subsidiary of Comverse Technology, Inc. (Comverse), and continued after Verint became a publicly traded company, while still majority-owned by Comverse, in 2002. In addition, the Commission today instituted administrative proceedings against Verint to determine whether the registration of each class of its securities should be revoked or suspended for a period not exceeding twelve months for its failure to file required periodic reports for over four years. In its settled Complaint, filed today in the United States District Court for the Eastern District of New York, the Commission alleges:
The Complaint alleges that as a result of this misconduct, Verint's books and records falsely and inaccurately reflected, among other things, the Company's liabilities, expenses, net income, and general financial condition through at least the fiscal year ended January 31, 2005. The Complaint also alleges that Verint failed to maintain a system of internal accounting controls sufficient to provide assurances that its reserve activity was recorded as necessary to permit the proper preparation of financial statements in conformity with GAAP. Without admitting or denying the allegations of the Commission's Complaint, Verint has consented to the entry of a final judgment permanently enjoining it from violating the antifraud, reporting, record-keeping, and internal controls provisions of the federal securities laws. Specifically, the proposed final judgment against Verint would permanently enjoin it from violating Section 17(a) of the Securities Act of 1933, Sections 13(a), 13(b)(2)(A), and 13(b)(2)(B) of the Securities Exchange Act of 1934 (Exchange Act), and Exchange Act Rules 13a-1 and 13a-13. In accepting the settlement offer, the Commission considered, among other things, Verint's remediation and cooperation in the Commission's investigation. The settlement is subject to the approval of the United States District Court for the Eastern District of New York. Separately, the Commission today issued an Order Instituting Administrative Proceedings and Notice of Hearing Pursuant to Section 12(j) of the Securities Exchange Act of 1934 against Verint, to determine whether the registration of each class of its securities should be revoked or suspended for a period not exceeding twelve months based on its failure to file required periodic reports. The Division of Enforcement alleges that Verint has failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder by failing to file an annual report on either Form 10-K or Form 10-KSB since April 25, 2005, or quarterly reports on either Form 10-Q or Form 10-QSB since Dec. 12, 2005. A hearing will be scheduled before an Administrative Law Judge to determine whether the allegations of the Division contained in the Order are true, and to provide Verint an opportunity to respond to these allegations. (Rel. 34-61635; File No. 3-13802); [SEC v. Verint Systems Inc., United States District Court for the Eastern District of New York, Civil Action No. 10-CV-0930-LDW-WDW (E.D.N.Y.)] (LR-21428; AAE Rel. 3117) Securities and Exchange Commission Orders Hearing on Registration Revocation Against Nine Public Companies for Failure to Make Required Periodic FilingsToday the Commission instituted public administrative proceedings to determine whether to revoke or suspend for a period not exceeding twelve months the registrations of each class of the securities of nine companies for failure to make required periodic filings with the Commission:
In this Order, the Division of Enforcement (Division) alleges that the nine issuers are delinquent in their required periodic filings with the Commission. In this proceeding, instituted pursuant to Exchange Act Section 12(j), a hearing will be scheduled before an Administrative Law Judge. At the hearing, the Administrative Law Judge will hear evidence from the Division and the Respondents to determine whether the allegations of the Division contained in the Order, which the Division alleges constitute failures to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 or 13a-16 thereunder, are true. The Administrative Law Judge in the proceeding will then determine whether the registrations pursuant to Exchange Act Section 12 of each class of the securities of these Respondents should be revoked or suspended for a period not exceeding twelve months. The Commission ordered that the Administrative Law Judge in this proceeding issue an initial decision not later than 120 days from the date of service of the order instituting proceedings. (Rel. 34-61636; File No. 3-13803) Commission Orders Hearings on Registration Suspension or Revocation Against Seven Companies for Failure to Make Required Periodic FilingsIn conjunction with today's trading suspension, the Commission also instituted public administrative proceedings to determine whether to revoke or suspend for a period not exceeding twelve months the registration of each class of the securities of seven companies for failure to make required periodic filings with the Commission:
In this Order, the Division of Enforcement (Division) alleges that the seven issuers are delinquent in their required periodic filings with the Commission. In this proceeding, instituted pursuant to Exchange Act Section 12(j), a hearing will be scheduled before an Administrative Law Judge. At the hearing, the judge will hear evidence from the Division and the Respondents to determine whether the allegations of the Division contained in the Order, which the Division alleges constitute failures to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder, are true. The judge in the proceeding will then determine whether the registrations pursuant to Exchange Act Section 12 of each class of the securities of these Respondents should be revoked or suspended for a period not exceeding twelve months. The Commission ordered that the Administrative Law Judge in this proceeding issue an initial decision not later than 120 days from the date of service of the order instituting proceedings. (Rel. 34-61637; File No. 3-13804) Commission Orders Hearings on Registration Suspension or Revocation Against Eight Companies for Failure to Make Required Periodic FilingsIn conjunction with today's trading suspension, the Commission also instituted public administrative proceedings to determine whether to revoke or suspend for a period not exceeding twelve months the registration of each class of the securities of eight companies for failure to make required periodic filings with the Commission:
In this Order, the Division of Enforcement (Division) alleges that the eight issuers are delinquent in their required periodic filings with the Commission. In this proceeding, instituted pursuant to Exchange Act Section 12(j), a hearing will be scheduled before an Administrative Law Judge. At the hearing, the judge will hear evidence from the Division and the Respondents to determine whether the allegations of the Division contained in the Order, which the Division alleges constitute failures to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder, are true. The judge in the proceeding will then determine whether the registrations pursuant to Exchange Act Section 12 of each class of the securities of these Respondents should be revoked or suspended for a period not exceeding twelve months. The Commission ordered that the Administrative Law Judge in this proceeding issue an initial decision not later than 120 days from the date of service of the order instituting proceedings. (Rel. 34-61638; File No. 3-13805) SEC v. Ross Owen HaugenThe Securities and Exchange Commission announced today that the Honorable Orinda D. Evans, United States District Judge for the Northern District of Georgia, entered final judgment on Feb. 17, 2010 (with a later amendment thereto) against defendant Ross Owen Haugen (Haugen) of Minneapolis, Minnesota. The judgment arises from an order granting the Commission's motion for summary judgment against Haugen, which also ordered that he pay disgorgement in the amount of $1,242,742.79, with prejudgment interest thereon in the amount of $125,316.63. The amended final judgment dated Feb. 25, 2010, further ordered Haugen to pay a civil penalty in the amount equal to his ordered disgorgement. Haugen had previously been permanently enjoined from future violations of Section 17(a) of the Securities Act of 1933, and Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, in an order entered on February 5, 2009. The Court made significant findings of fact and conclusions of law in the final judgment and amended final judgment against Haugen. Specifically, the Court concluded that Haugen engaged in fraud in connection with sales of securities interests in four offerings identified as Coadum Capital Fund 1, LLC (Coadum 1), Coadum Capital Fund II, LP (Coadum II), Coadum Capital Fund III, LP (Coadum III) and Mansell Acquisition Company LP (MAC). Approximately $30 million was raised from investors in the four offerings from early 2006 through January 2008. The Court also concluded that Haugen while acting as vice president of sales and marketing for Coadum Advisors, Inc. (Coadum), served as the primary salesman for the offerings on behalf of Coadum and Mansell Capital Partners III, LLC (Mansell). In its final judgment, the Court found that Haugen directly solicited and sold more than 50% of the Coadum securities in the offerings. The private placement memoranda for the four offerings (PPMs), all of which made similar representations, described an investment objective involving "risk-controlled" strategies consisting of purchasing AA or better rated securities at one price, and simultaneously selling the securities at a higher price, generating a profit on the price difference, which Coadum and Mansell referred to as "commercial trading programs." Coadum and Mansell invested the majority of the funds through a Malta based "investment platform" which in turn invested the funds in related entities which never began operation or provided any returns. Further, Coadum and Mansell falsely represented in monthly account statements to investors that the investors had been earning approximately four percent per month and that all or most of the investors' principal was in escrow. The Court found that Haugen told investors, falsely, that their investment principal was risk free, insured and never left the escrow account or was otherwise guaranteed against loss. In fact, Haugen knew that investors' funds were being invested in off-shore trading programs. Moreover, although the PPMs represented that no commissions were paid on the investments and that the promoters were compensated based on a percentage of earnings, Haugen personally was paid substantial commissions from investor funds prior to earnings on those funds, which never occurred. This is a companion case to SEC v. Coadum Advisors, Inc., et al., Civil Action File No. 1:08-CV-0011-ODE (N.D. Ga.), a civil action filed on an emergency basis on Jan.3, 2008. [SEC v. Ross Owen Haugen, Civil Action File No. 1:09-CV-0129 (N.D. Ga.)] (LR-21429) SEC Charges Gaston and Teresita Cantens With Operating a $135 Million Ponzi Scheme and Affinity Fraud Targeting Cuban-AmericansThe Securities and Exchange Commission filed a civil injunctive action against Gaston E. Cantens and Teresita Cantens alleging that they conducted a $135 million Ponzi scheme and affinity fraud targeting Cuban-American investors, primarily from South Florida. The SEC's complaint alleges that the Cantens, founders and co-owners of Royal West Properties, Inc. (Royal West), a Miami-based real estate developer, defrauded more than 400 investors by offering promissory notes claiming annual returns of 9 to16% purportedly backed by recorded mortgage assignments. Since 1993, the Cantens funded Royal West's real estate business by offering investors no-risk promissory notes. The Cantens assured prospective investors as to the safety of their principal and interest by touting Royal West's successful real estate business and promising to collateralize investor funds with recorded mortgage assignments. They further assured prospective investors by claiming they were personally worth over $65 million and, as to some investors, executing personal guarantees. The complaint alleges that, contrary to these claims, Royal West was not generating sufficient revenues to repay principal and interest to investors and, since at least 2002, the Cantens were operating a Ponzi scheme, raising new investor funds to pay earlier investors. Moreover, since at least 2005, Royal West failed to record approximately one-third of the mortgage assignments. Finally, the Cantens misappropriated approximately $20 million of investor funds to pay themselves lavish salaries, to fund unrelated personal business ventures, and to pay their children and grandchildren. The SEC's complaint, filed in the United States District Court for the Southern District of Florida, charges the defendants with violating Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC seeks permanent injunctions, sworn accountings, disgorgement of ill-gotten gains with prejudgment interest, and civil money penalties against the defendants. [SEC v. Gaston E. Cantens and Teresita Cantens, Civil Action No. 1:10-CV-20635-PAS(gme) (S.D. FL)] (LR-21430) INVESTMENT COMPANY ACT RELEASESU.S. One, Inc. and U.S. One TrustAn order has been issued on an application filed by U.S. One, Inc. and U.S. One Trust. The order permits (a) series of certain open-end management investment companies to issue shares (Shares) redeemable in large aggregations only (Creation Units); (b) secondary market transactions in Shares to occur at negotiated market prices; and (c) certain affiliated persons of the series to deposit securities into, and receive securities from, the series in connection with the purchase and redemption of Creation Units. (Rel. IC-29164 - March 1) SELF-REGULATORY ORGANIZATIONSImmediate Effectiveness of Proposed Rule ChangesThe NASDAQ Stock Market filed a proposed rule change (SR-NASDAQ-2010-026) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 to eliminate erroneous citations from Rule 9557, Procedures for Regulating Activities Under Rules 4110A and 4120A Regarding a Member Experiencing Financial or Operational Difficulties. Publication is expected in the Federal Register during the week of March 8. (Rel. 34-61606) A proposed rule change filed by NYSE Amex amending NYSE Amex Equities Rule 123C(9)(a)(1) to extend the operation of the pilot operating pursuant the rule until the earlier of Securities and Exchange Commission approval to make such pilot permanent or June 1, 2010 (SR-NYSEAmex-2010-15) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of March 8. (Rel. 34-61611) A proposed rule change filed by New York Stock Exchange amending NYSE Rule 123C(9)(a)(1) to extend the operation of the pilot operating pursuant the rule until the earlier of Securities and Exchange Commission approval to make such pilot permanent or June 1, 2010 (SR-NYSE-2010-11) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of March 8. (Rel. 34-61612) A proposed rule change filed by New York Stock Exchange amending NYSE's Price List (SR-NYSE-2010-14) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of March 8. (Rel. 34-61613) A proposed rule change filed by NYSE Amex, as modified by Amendment No. 1 thereto, clarifying the implementation date of the amendments to NYSE Amex Equities Rule 123C to modify the procedures for its closing process and make conforming changes to NYSE Amex Equities Rules 13 and 15 (SR-NYSEAmex-2010-17) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of March 8. (Rel. 34-61614) A proposed rule change filed by NYSE Amex amending its fee schedule (SR-NYSEAmex-2010-10) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of March 8. (Rel. 34-61615) A proposed rule change filed by New York Stock Exchange, as modified by Amendment No. 1 thereto, clarifying the implementation date of the amendments to NYSE Equities Rule 123C to modify the procedures for its closing process and make conforming changes to NYSE Equities Rules 13 and 15 (SR-NYSE-2010-12) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of March 8. (Rel. 34-61616) A proposed rule change filed by NYSE Amex amending NYSE Amex's Price List (SR-NYSEAmex-2010-20) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of March 8. (Rel. 34-61619) The Depository Trust Company filed a proposed rule change (SR-DTC-2010-04) under Section 19(b)(1) of the Exchange Act, which became effective upon filing, to modify its registered transfer agent notification methods for assumption or termination of services. Publication is expected in the Federal Register during the week of March 8. (Rel. 34-61620) Approval of Proposed Rule ChangeThe Commission has approved a proposed rule change (SR-NSCC-2010-01) filed by The National Securities Clearing Corporation under Section 19(b)(1) of the Exchange Act to eliminate NSCC's guarantee of payment in connection with the Envelope Settlement Service. Publication is expected in the Federal Register during the week of March 8. (Rel. 34-61618) SECURITIES ACT REGISTRATIONSRECENT 8K FILINGS
http://www.sec.gov/news/digest/2010/dig030310.htm
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