UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
SECURITIES EXCHANGE ACT OF 1934
Release No. 47580 / March 27, 2003
File No. 3-11076
In the Matter of
TIMOTHY J. PINCHIN
| ORDER INSTITUTING PUBLIC
PROCEEDINGS PURSUANT TO
SECTION 15(b)(6) OF THE SECURITIES
EXCHANGE ACT OF 1934, MAKING
FINDINGS, AND IMPOSING REMEDIAL
The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that proceedings pursuant to Section 15(b)(6) of the Securities Exchange Act of 1934 ("Exchange Act") be, and they hereby are, instituted against Timothy J. Pinchin ("Pinchin" or "Respondent").
In anticipation of the institution of these proceedings, Pinchin has, pursuant to Rule 240(a) of the Securities and Exchange Commission's ("Commission") Rules of Practice [17 C.F.R. § 201.240(a)], submitted an Offer of Settlement ("Offer"), 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 to which the Commission is a party, Pinchin:
- admits jurisdiction of the Commission over him, over the subject matter of this proceeding and over the matters set forth in this Order; and
- without admitting or denying the findings in this Order, except as to the entry of the order by the British Columbia Securities Commission in Paragraph III.B. below and the entry of the injunction in Paragraph III.E. below, which is admitted, consents to the entry of this Order and the imposition of the remedial sanctions set forth below.
On the basis of this Order and Respondent's Offer, the Commission finds:
- That Pinchin currently is a resident of West Vancouver, British Columbia, Canada.
- That on October 11, 1996, the British Columbia Securities Commission ("BCSC") entered an order In the Matter of Timothy James Pinchin, N.C.G. Capital Group, Ltd. And N.C.G. Asset Management Ltd., in which the BCSC found violations of securities laws by Pinchin.
- That on August 2, 1999, the Commission filed its Complaint For Permanent Injunction and Other Legal and Equitable Relief ("Complaint") against Pinchin and others. The Complaint was filed in the United States District Court for the Northern District of California, Securities and Exchange Commission v. Edward A. Durante, et al., Civil Action No. C99-3690 SBA (MEJ) (N.D. Cal.)("Civil Action").
- That the Commission's Complaint alleged that at all relevant times, the common stock of PSA, Inc. was a penny stock, as defined in the Exhange Act and Rules thereunder. The Complaint further alleged that, from approximately May 1998 through August 1998, Pinchin: (a) touted PSA, Inc. stock on a website he controlled through a company called Shareholder Communications Group, LLC, and, although disclosing that he was being paid cash, failed to disclose to potential investors that he was being paid 125,000 shares of PSA, Inc. stock from a group of promoters in exchange for the favorable website publicity; (b) operated another company he controlled, Pacific Corporate Equities, LLC, as an unregistered broker-dealer; and (c) participated in an illegal unregistered distribution of the common stock of PSA, Inc. by purchasing 200,000 shares of PSA, Inc. stock from the same group of promoters at a deep discount, marking up the price of the shares nearly thirty-five percent, and then reselling the shares to another investor at a profit.
- That on February 14, 2003, a Final Judgment of Permanent Injunction And Other Equitable and Statutory Relief was entered against Pinchin by the United States District Court for the Northern District of California in the Civil Action. The Final Judgment, which was entered pursuant to Pinchin's consent, permanently enjoins Pinchin from violations of Sections 5(a), 5(c), and 17(b) of the Securities Act of 1933, and Section 15(a) of the Exchange Act. It also orders Pinchin to disgorge $63,980.00 in ill-gotten gains; however, payment of that amount was waived based upon Pinchin's sworn representations in his Statement of Financial Condition dated February 4, 2003 and other documents submitted to the Commission. The Final Judgment also noted that a civil penalty was appropriate, but was not imposed based on Pinchin's sworn representations in his Statement of Financial Condition dated February 4, 2003 and other documents submitted to the Commission. Pinchin consented to the entry of the Final Judgment without admitting or denying the allegations in the Commission's Complaint.
In view of the foregoing, the Commission deems it appropriate and in the public interest to impose the sanctions specified in Pinchin's Offer.
ACCORDINGLY, IT IS HEREBY ORDERED, pursuant to Section 15(b)(6) of the Exchange Act, that Timothy J. Pinchin be, and he hereby is, barred from participating in any offering of a penny stock, including: (a) acting as a promoter, finder, consultant, agent, or other person who engages in activities with a broker, dealer or issuer for purposes of the issuance or trading in any penny stock; or (b) inducing or attempting to induce the purchase or sale of any penny stock.
By the Commission.
Jonathan G. Katz