UNITED STATES OF AMERICA Before the SECURITIES AND EXCHANGE COMMISSION SECURITIES EXCHANGE ACT OF 1934 Release No. 36872 / February 22, 1996 ADMINISTRATIVE PROCEEDING File No. 3-8956 ------------------------- : : : In the Matter of : ORDER INSTITUTING PUBLIC : PROCEEDINGS, MAKING JOHN S. GRIFFIN : FINDINGS AND IMPOSING : REMEDIAL SANCTIONS : -------------------------: I. The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that administrative proceedings be instituted pursuant to Sections 15(b) and 19(h) of the Securities Exchange Act of 1934 ("Exchange Act") against John S. Griffin ("Griffin"), a registered representative associated with a brokerage firm registered with the Commission pursuant to Section 15(b) of the Exchange Act. In anticipation of the institution of these proceedings, Griffin has submitted an Offer of Settlement ("Offer") that the Commission has determined to accept. Solely for the purpose of this proceeding and any other proceeding brought by or on behalf of the Commission or to which the Commission is a party, without admitting or denying the findings contained herein, except for those set forth in paragraphs II.A. and II.G. below, which are admitted, Griffin by his Offer consents to the entry of this Order Instituting Public Proceedings, Making Findings and Imposing Remedial Sanctions. ACCORDINGLY, IT IS ORDERED that proceedings pursuant to Sections 15(b) and 19(h) of the Exchange Act against Griffin be, and hereby are, instituted. II. On the basis of this Order Instituting Public Proceedings, Making Findings and Imposing Remedial Sanctions, and the Offer submitted by Griffin, the Commission finds that: A. From October 1990 to February 1992, Griffin was a registered representative associated with McCarley and Associates, a broker-dealer registered with the Commission. From February 1992 to December 1994, Griffin was a registered representative associated with Robert Thomas Securities, Inc. ("Robert Thomas"), a broker-dealer registered with the Commission. B. At all times relevant to these proceedings, Griffin was the vice-president, a director and the registered corporate agent of Oliver-Griffin, Ltd. ("Oliver- Griffin"), and was solely responsible for the firm's operations. Additionally, at all times relevant to these proceedings, Oliver-Griffin, acting by and through Griffin, held itself out to be a registered broker-dealer, investment banking and financial services firm. C. From October 1990 to January 1995, Griffin willfully violated Section 17(a) of the Securities Act of 1933 ("Securities Act") in the offer and sale of securities in that he, directly and indirectly, by the use of the means or instruments of transportation or communication in interstate commerce or by the use of the mails, employed devices, schemes, or artifices to defraud; obtained money and property by means of untrue statements of material fact or omitted to state material facts necessary to make the statements made, in the light of the circumstances under which they were made, not misleading; or engaged in transactions, practices or courses of business that would and did operate as a fraud or deceit upon the purchasers of such securities. D. As part of the aforesaid conduct described in paragraph II.C. above, Griffin engaged in a scheme to defraud customers through the use of material misrepresentations and omissions. Griffin induced Oliver-Griffin customers to give him approximately $400,000 under the pretense that he would use the funds to purchase securities for them through Oliver-Griffin. Rather than purchasing the securities, Griffin misappropriated the money. In furtherance of the scheme, Griffin made false and misleading statements and omitted to state material facts concerning, among other things: a. the use of customer funds; b. the value and existence of securities identified in customer account statements and confirmation statements; and c. Oliver-Griffin's status as a registered broker-dealer. E. From October 1990 to January 1995, Griffin willfully violated Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, in connection with the purchase and sale of securities, in that he, directly and indirectly, by the use of the means or instrumentality of interstate commerce or of the mails, employed devices, schemes, or artifices to defraud; made untrue statements of material fact or omitted to state material facts necessary to make the statements made, in the light of the circumstances under which they were made, not misleading; or engaged in acts, practices or courses of business that would and did operate as a fraud or deceit upon the purchasers of such securities, as more fully described in paragraphs II.C. and II.D. above. F. From October 1990 to January 1995, Griffin willfully violated Section 15(a)(1) of the Exchange Act by using the mails, and the means and instrumentalities of interstate commerce, to effect transactions in, and to induce or attempt to induce the purchase or sale of, securities without being registered in accordance with Section 15(b) of the Exchange Act. As part of the aforesaid conduct, Griffin, through Oliver-Griffin, effected transactions in, and induced or attempted to induce the purchase or sale of, securities. At the time of the transactions, neither Griffin nor Oliver- Griffin was registered with the Commission as a broker or a dealer. G. On February 1, 1996, a Final Judgment of Permanent Injunction was entered against Griffin by the United States District Court for the Eastern District of Pennsylvania, in Securities and Exchange Commission v. Oliver-Griffin, Ltd. and John S. Griffin, Civil Action No. 96-CV-0645. The Final Judgment enjoined Griffin from future violations of Section 17(a) of the Securities Act, and Sections 10(b) and 15(a) of the Exchange Act and Rule 10b-5 thereunder. In the civil action, the Commission alleged the same facts set forth herein. Griffin consented to the Final Judgment of Permanent Injunction, without admitting or denying the allegations in the Commission's complaint. III. In view of the foregoing, the Commission deems it appropriate and in the public interest to impose the sanctions specified in the Offer. ACCORDINGLY, IT IS HEREBY ORDERED that, effective immediately, John S. Griffin be and hereby is barred from association with any broker, dealer, municipal securities dealer, investment company or investment adviser. By the Commission. Jonathan G. Katz Secretary