UNITED STATES OF AMERICA
In the Matter of
BENJAMIN J. MALDONADO III,
|ORDER INSTITUTING PUBLIC ADMINISTRATIVE PROCEEDINGS, MAKING FINDINGS AND IMPOSING SANCTIONS PURSUANT TO SECTION 15(b) OF THE SECURITIES EXCHANGE ACT OF 1934|
The Securities and Exchange Commission (the "Commission") deems it appropriate in the public interest that public administrative proceedings be instituted pursuant to Section 15(b) of the Securities Exchange Act of 1934 ("Exchange Act") against Respondent Benjamin J. Maldonado III ("Maldonado").
In anticipation of these proceedings, Maldonado has submitted an Offer Of Settlement Of Benjamin J. Maldonado III ("Offer of Settlement") to the Commission, which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceedings brought by or on the behalf of the Commission, or in which the Commission is a party, and without admitting or denying the findings herein, except that Maldonado admits the jurisdiction of the Commission over him and over the subject matter of these proceedings and that a Final Judgment As To Defendant Benjamin J. Maldonado III ("Final Judgment") has been entered against him as set forth in section III.D., below, Maldonado consents to the entry of this Order Instituting Public Administrative Proceedings, Making Findings And Imposing Sanctions Pursuant To Section 15(b) Of The Securities Exchange Act Of 1934 ("Order") and to the entry of the findings and sanctions set forth below.
Accordingly, IT IS HEREBY ORDERED that said administrative proceedings against Maldonado be, and hereby are, instituted pursuant to Section 15(b) of the Exchange Act.
On the basis of this Order and Maldonado's Offer of Settlement, the Commission makes the following findings:
A. Between October 1986 and January 2000, Maldonado, age 37, was associated with the Washington, DC office of Merrill Lynch, Pierce, Fenner & Smith, Inc., a registered broker-dealer.
B. On December 19, 2001, the Commission filed a Complaint in the United States District Court for the District of Columbia, in an action captioned Securities and Exchange Commission v. Sean R. Price and Benjamin J. Maldonado III, Civil Action No. 1:01CV02624, charging Maldonado with violations of Section 17(a) of the Securities Act of 1933 ("Securities Act") and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.
C. In the injunctive action described in section III.B., above, the Commission's Complaint alleges, inter alia, that Maldonado knew or was reckless in not knowing that he traded in the securities of Information Resource Engineering, Inc. ("IREG") while in possession of material, nonpublic information about IREG's third quarter 1999 earnings, and that the information he possessed had been communicated by Sean R. Price in breach of a duty that Price owed to IREG. As a result of his alleged insider trading, Maldonado and his family avoided losses of $38,489.80.
D. On December 20, 2001, the Final Judgment was entered against Maldonado in the United States District Court for the District of Columbia by consent which: (i) permanently enjoined Maldonado from, directly or indirectly, violating Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder; and (ii) held Maldonado liable for disgorgement and prejudgment interest in the amount of $44,962.09 and the imposition of a civil monetary penalty of $38,489.80.
Based on the foregoing, the Commission deems it appropriate in the public interest to impose the sanctions specified in Maldonado's Offer of Settlement.
Accordingly, IT IS HEREBY ORDERED that Maldonado be, and hereby is, barred from association with any broker or dealer, with the right to reapply for association after five years to the appropriate self-regulatory organization, or if there is none, to the Commission.
By the Commission.
Jonathan G. Katz
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