UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Securities Act of 1933
Securities Exchange Act of 1934
PUBLIC ADMINISTRATIVE PROCEEDINGS INSTITUTED AGAINST VINCENT W. BEALE, SR., TYRONE KILLEBREW AND BNB CAPITAL, INC. (f/k/a BNB SECURITIES, INC.)
The Securities and Exchange Commission ("Commission") today issued an Order Instituting Public Administrative Proceedings, and Notice of Hearing, Pursuant to Section 8A of the Securities Act of 1933 ("Securities Act"), and Sections 15(b), 19(h) and 21C of the Securities Exchange Act of 1934 ("Exchange Act") (the "Order") against
The Division of Enforcement ("Division") alleges that the Respondents willfully violated, and committed or caused violations of, Section 15(a)(1) of the Exchange Act, and that Beale and Killebrew also willfully violated, and committed or caused violations of, Section 17(a) of the Securities Act and Sections 10(b) and 15(c) of the Exchange Act and Rules 10b-5 and 15c1-2 thereunder.
The Division alleges that in April and May 1996, Beale and Killebrew offered and sold unregistered one year promissory notes issued by a start-up communications company for a 25 percent commission. The Division further alleges that Beale and Killebrew made material misrepresentations and omissions, including: that an investment in the convertible notes posed little or no risk; that the issuer had an enormous potential for profit; that the issuer owned rights to the communications technology it sought to develop; that investors could profit from an initial public offering by the issuer; and that Beale had personally invested $1.6 million in the issuer. The issuer is no longer in business, and investors never received any return on their investment.
Additionally, the Division alleges that before BNB was registered with the Commission as a broker-dealer, Beale and Killebrew agreed to have BNB offer a private placement of the unregistered common stock of a lighting company, in return for its expenses and a 10 per cent commission. Between February 1997 and July 1997, BNB, by and through Beale and Killebrew, raised approximately $1.5 million from the sale of the lighting manufacturer's stock before BNB's registration became effective.
A hearing will be held before an administrative law judge to determine whether the staff's allegations against Beale, Killebrew and BNB are true, and if so, what remedial sanctions are appropriate in the public interest and for the protection of investors, and whether Beale and Killebrew should be ordered to pay disgorgement and/or civil penalties.