UNITED STATES OF AMERICA
SECURITIES EXCHANGE ACT OF 1934
The Securities and Exchange Commission ("Commission") deems it appropriate in the public interest and for the protection of investors that public administrative proceedings be and hereby are instituted pursuant to Sections 15(b)(6) of the Securities Exchange Act of 1934 ("Exchange Act"), against Bill J. Short, II ("Short").
In anticipation of the institution of these proceedings, Short has submitted an Offer of Settlement to the Commission which the Commission has determined to accept. Solely for the purposes of these proceedings and any other proceedings brought by or on behalf of the Commission or in which the Commission is a party and without admitting or denying the findings contained herein, except as to entry of the injunction described below and the Commission's jurisdiction over him and over the subject matter of this proceeding, which are admitted, Short consents to the institution of public administrative proceedings, and the findings and remedial sanctions set forth below.
On the basis of this Order and the Offer of Settlement submitted by Short, the Commission finds that:
A. Short, age 35, is a resident of Marco Island, Florida, and the owner of Seajay Capital, Inc. and BilCin Enterprises, Inc. He is also an owner and the managing director of Gulfcoast Holdings, LLC.
B. From approximately April 1999 to June 1999, Short was acting as an unregistered broker-dealer.
C. On October 15, 1999, the Commission filed a Complaint in the United States District Court for the Southern District of New York against Short and others captioned SEC v. Charles Richard Homa, et al. On October 18, 1999, the action was transferred to the Northern District of Illinois and assigned case number 99 C 6895. On June 1, 2000, the Commission filed its Amended Complaint.
D. The Commission's Amended Complaint alleges that from April 1999 through June 1999, Short and other defendants violated the federal securities laws by fraudulently engaging in a $314 million Ponzi scheme involving at least 1000 investors. The Amended Complaint alleges that Short, as part of an extensive sales network developed by Charles Richard Homa ("Homa") and Michael Gause ("Gause"), offered and sold securities, in the form of promissory notes and bonds issued by Gulfcoast Holdings, LLC, which purported to provide returns through investments in the car title and payday loan business. The Amended Complaint alleges Short raised $487,000. Further, the Amended Complaint alleges that the investment funds were not used in the car title or payday loan business, but rather were used to make interest payments to existing investors, to pay marketer commissions, and for personal expenditures of Homa and Gause. The Amended Complaint alleges that Short and other defendants made misrepresentations and omissions of material fact concerning the use of investor funds and failed to disclose the source of the interest payments and that the notes and receivables purportedly securing certain offerings were insufficient security. The Amended Complaint also alleges that Short, in the course of marketing the securities, acted as an unregistered broker-dealer.
E. On March 8, 2000, in SEC v. Homa, the Honorable Ronald A. Guzman entered an order enjoining Short from violations of Section 17(a) of the Securities Act of 1933 and Sections 10(b), 15(a), and 15(c) of the Exchange Act and Rules 10b-5 and 15c1-2 promulgated thereunder. Short, without admitting or denying the allegations in the Complaint, consented to Judge Guzman's Order.
In view of the foregoing, the Commission deems it appropriate in the public interest and for the protection of investors to accept the Offer of Settlement of Bill J. Short, II.
Accordingly, IT IS ORDERED that Respondent Bill J. Short, II is barred from association with any broker or dealer.
By the Commission.