SEC v. Stifel, Nicolaus & Co., Inc., et al. Case No. 11-cv-00755-JPS (E.D. Wis.)

On August 10, 2011, the Commission filed a complaint, which was amended on October 5, 2012, against Stifel, Nicolaus & Co., Inc. (“Stifel”) and David W. Noack (“Noack”) (collectively, the “Defendants”). The amended complaint alleged that, from June 2006 to December 2006, the Defendants violated federal securities laws by defrauding five Wisconsin school districts by selling them unsuitably risky and complex investments funded largely with borrowed money. See Amended Complaint.

The Defendants were ordered to pay $1,660,000.00 in disgorgement directly to five Wisconsin School District investors and $840,000.00 in prejudgment interest to the Commission; Stifel was ordered to pay a $22,000,000.00 civil penalty with $11,160,000.00 to be paid to the Commission and $10,840,000.00 to be paid directly to the five Wisconsin School District investors; and Noack was ordered to pay a $100,000.00 civil penalty to the Commission. The final judgment created a Fair Fund, pursuant to Section 308(a) of the Sarbanes-Oxley Act of 2002, as amended, so the $12,100,000.00 ordered to be paid to the Commission, together with interest and income earned thereon, can be distributed to those harmed by the Defendants’ misconduct. See Defendents’ Final Judgment.

As of May 31, 2017, the Defendants have paid as ordered to the five Wisconsin School District investors. Stifel has paid $12,000,000.00 into the Fair Fund for distribution to harmed investors. Any additional funds collected from Noack will be added to the Fair Fund. 

On June 23, 2017, the Court appointed Damasco & Associates LLP as the Tax Administrator to fulfill the tax obligations of the Fair Fund. 

For more information, please contact the Commission: 

Office of Distributions
Email: ENFOfficeofDistributions@sec.gov