UNITED STATES OF AMERICA
In the Matter of
JOHN ADAMS, JR., et al.
|ORDER MAKING FINDINGS AND IMPOSING SANCTION BY DEFAULT AGAINST CURTIS MARCHAND, III|
This Order bars Curtis Marchand, III, from association with a broker-dealer, based on his felony conviction. Marchand, who had been associated with a broker-dealer that operated as a boiler room, was convicted of conspiracy to commit securities fraud.
The Securities and Exchange Commission (Commission) issued its Order Instituting Proceedings (OIP) in this matter on February 15, 2002, pursuant to Section 15(b) of the Securities Exchange Act of 1934 (Exchange Act). The OIP alleges that Curtis Marchand, III, was associated with a broker-dealer from June 1993 to November 1995, and was convicted of conspiracy to commit securities fraud. Marchand was served with the OIP on March 25, 2002. He failed to file an Answer, due twenty days after he was served. See 17 C.F.R. § 201.220(b); OIP at 5. The Division of Enforcement (Division) has filed a Motion for Default, asking that Marchand be barred from association with any broker or dealer. A respondent who fails to file an Answer to the OIP may be deemed to be in default, and the administrative law judge may determine the proceeding against him. See 17 C.F.R. §§ 201.155(a), .220(f). On April 16, Marchand was ordered to show cause by April 26 why he should not be held in default and barred from association with any broker or dealer. He did not respond.
Marchand is in default because he failed to file an Answer or otherwise to defend the proceeding. See 17 C.F.R. §§ 201.155(a)(2), .220(f). Accordingly, the undersigned finds that the allegations in the OIP as to Marchand are true. The findings of fact and conclusions of law made in this order as to Marchand are not binding on any other person in this proceeding.
II. FINDINGS OF FACT
Marchand was employed as a registered representative, manager, assistant branch manager, and regional vice president from June 1993 to November 1995 at a registered broker-dealer, L.C. Wegard & Co., Inc. (Wegard). Wegard operated as a boiler room, and Marchand and others participated in a conspiracy to commit securities fraud by inducing unsuspecting investors to purchase speculative high-risk securities through the use of fraudulent and deceptive sales practices. Marchand was convicted of conspiracy to commit securities fraud on July 13, 2000. See United States v. Marchand, No. 97-647-06 (D. N.J. July 13, 2000).
III. CONCLUSIONS OF LAW
Marchand has been convicted, within ten years of the commencement of this proceeding, of "conspiracy to commit" a felony that "involves the purchase or sale of any security" and also "arises out of the conduct of the business of a broker [or] dealer" within the meaning of Sections 15(b)(4)(B) and 15(b)(6)(A)(ii) of the Exchange Act. His unlawful conduct was recurring and egregious. There are no mitigating circumstances.
The Division requests that Marchand be barred from association with any broker or dealer. This sanction will serve the public interest and the protection of investors, pursuant to Sections 15(b) and 19(h) of the Exchange Act, and accords with Commission precedent and the sanction considerations set forth in Steadman v. SEC, 603 F.2d 1126, 1140 (5th Cir. 1979).
IT IS ORDERED that CURTIS MARCHAND, III, IS BARRED from association with any broker or dealer.
Carol Fox Foelak
Administrative Law Judge
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