U.S. Securities & Exchange Commission
SEC Seal
Home | Previous Page
U.S. Securities and Exchange Commission


Securities Exchange Act of 1934
Release No. 42877 / June 1, 2000

Administrative Proceeding
File No. 3-10213


On June 1, 2000, the Commission instituted administrative proceedings against Joseph A. Monaco ("Monaco") of Lake Mary, Florida. The Order Instituting Administrative Proceedings ("Order") is based on the entry of an order issued by the U.S. District Court for the Middle District of Florida permanently enjoining Monaco from violating the antifraud and registration provisions of the federal securities laws. Securities and Exchange Commission v. James T. Staples, et al., Civil Action No. 98-1061-CIV-22C (M.D. Fla.).

In the District Court proceeding, the Commission alleged that from 1994 to 1996, Legend Sports, Inc. and Monaco operated a Ponzi scheme by using $18 million in proceeds from the sale of promissory notes and preferred stock to pay interest and dividends to investors, commissions to its salesmen and the expenses of company officers. The Complaint alleged that Monaco sold the notes and stock to the public, and that he recruited and supervised the other salesmen who sold the notes and stock. In addition, the Complaint alleged that Monaco and the other salesmen misrepresented and omitted material facts in connection with the sale of the securities, including, failing to disclose to investors that they received a 15% commission for each security they sold and that Monaco was paid a 5% override on every security sold by Legend Sports.

In March 2000, the District Court ordered Monaco to disgorge six million dollars of the proceeds Legend Sports received through the fraudulent sale of the notes and preferred stock. Formerly based in Altamonte Springs, Florida, Legend Sports developed and operated golf entertainment facilities in central Florida between 1992 and 1998.

A hearing will be held before an administrative law judge to determine what remedial relief, if any, is appropriate in the public interest, including a bar from participating in any offering of a penny stock.