UNITED STATES OF AMERICA Before the SECURITIES AND EXCHANGE COMMISSION SECURITIES EXCHANGE ACT OF 1934 Release No. 41295 \ April 15, 1999 ADMINISTRATIVE PROCEEDING File No. 3-9874 ) ) In the Matter of ) ORDER INSTITUTING PUBLIC ) PROCEEDINGS, MAKING Danny Lee Coomer, ) FINDINGS AND IMPOSING Respondent. ) REMEDIAL SANCTIONS ) ) I. The Securities and Exchange Commission (Commission) deems it appropriate and in the public interest that public administrative proceedings be instituted pursuant to Sections 15(b) and 19(h) of the Securities Exchange Act of 1934 (Exchange Act) against Danny Lee Coomer (Coomer). II. In anticipation of the institution of these administrative proceedings, Coomer has submitted an Offer of Settlement (Offer) which the Commission has determined it is in the public interest to accept. Solely for the purpose of these proceedings, and any other proceedings brought by or on behalf of the Commission or to which the Commission is a party, and without admitting or denying the findings, except as to jurisdiction and the facts set forth in Paragraphs III.A - III.C below, which he admits, Coomer consents to the entry of this Order, its findings and the imposition of sanctions as set forth below. III. On the basis of this Order and Offer, the Commission finds that: A. Coomer, age 52, currently a resident of Trotwood, Ohio, was a registered representative since approximately 1975. From approximately April 1996 to March 1998, Coomer was associated with a broker-dealer registered with the Commission pursuant to Section 15(b) of the Exchange Act. Since February of 1975, Coomer was a registered representative with five other broker- dealers which were registered with the Commission pursuant to Section 15(b) of the Exchange Act. B. On September 1, 1998, Coomer was convicted for committing the offenses of engaging in a pattern of corrupt activity, grand theft, and violating the Ohio Securities Act [Ohio Rev. Code §§ 2923.32, 2913.02(A)(3), and 17044.44(B)(4)]. State of Ohio v. Danny L. Coomer, No. 98-CR-1431 (Ohio Dec. 1998). On September 3, 1998, the Common Pleas Court of Montgomery County, Ohio sentenced Coomer to ten (10) years in prison. C. On August 31, 1998, Coomer entered into a plea agreement with the Office of the United States Attorney for the Southern District of Ohio where he plead guilty to money laundering and stipulated that he committed the offenses of mail fraud and wire fraud [18 U.S.C. §§ 1341 and 1343]. United States v. Danny L. Coomer, No. CR-3-98-075 (S.D. W. Ohio 1998). On January 4, 1999 Coomer was sentenced to ten (10) years in confinement, more than $2 million in restitution, three years of supervised release and a special assessment of $100. D. The plea agreement with the Office of the United States Attorney was based on, among other things, the following: 1. From approximately 1990 through February 1998, Coomer owned and managed a business known as DLC Financial Services Incorporated (DLC Financial) which operated from offices in Dayton, Ohio. 2. From approximately 1990 through February 1998, Coomer, while holding himself out as a registered representative, raised more than two million dollars ($2,000,000) from approximately one hundred (100) investors in twelve (12) states. Coomer told the investors that he would place their money in Canadian bonds or certain small businesses. Coomer told investors that he was able to sell Canadian bonds because he was one of the broker dealer’s top salesmen. Coomer told investors that he did not need to provide them with a prospectus or other paperwork because of his status as a top salesman at the broker dealer. The clients’ funds were never invested in Canadian bonds or small businesses. Instead, the money raised from clients was misappropriated by Coomer and used to pay DLC Financial’s business expenses and his own personal expenses. 3. Coomer concealed his fraudulent activity from all of the investors and the broker-dealer by issuing false quarterly reports on DLC Financial letterhead. In some instances, Coomer convinced customers to reinvest their purported profits in order to receive periodic payments. These periodic payments were checks issued from DLC Financial accounts in the hope of obtaining additional funds from these investors, encouraging these individuals to recommend other potential investors, and to prevent the discovery of his fraudulent scheme. IV. In view of the foregoing, the Commission deems it appropriate and in the public interest to accept Coomer’s Offer and to impose the sanctions which are set forth in the Offer. Accordingly, IT IS ORDERED that Coomer be, and hereby is, barred from association with any broker, dealer, investment company, investment adviser or municipal securities dealer. By the Commission. Jonathan G. Katz Secretary