Mark Deyak

The United States Securities and Exchange Commission announced today that it instituted public administrative proceedings against Mark Deyak pursuant to Section 15(b) of the Securities Exchange Act of 1934.

In the Order Instituting Administrative Proceedings ("Order"), the Division of Enforcement alleges that on July 11, 2003, a final judgment was entered by default against Deyak, permanently enjoining him from future violations of Section 17(a) of the Securities Act of 1933 ("Securities Act") and Sections 10(b), 15(a) and 15(c) of the Exchange Act and Rule 10b-5 thereunder, in the civil action entitled Securities and Exchange Commission v. Von Christopher Cummings, et al., Civil Action Number C2 02 629, in the United States District Court for the Southern District of Ohio. Deyak was also ordered to pay disgorgement of $184,500, plus prejudgment interest thereon, and a $120,000 civil penalty.

The Commission's complaint alleged that Paramount Financial Partners, Inc. ("Paramount"), through Von C. Cummings and others, falsely represented to investors that it was a hedge fund that generated large returns for clients through the mid-to-late 1990's. In fact, Paramount was not a hedge fund, and neither Paramount nor Cummings bought and sold securities for clients' accounts. Investors paid at least $14.2 million total directly to Paramount, from at least May 2000 through approximately the Spring of 2001. Beginning in May 2000, at Cummings' direction, those funds were primarily deposited in several bank and brokerage accounts in Paramount's name. At Cummings' direction, the vast majority of those funds were used to repay previous Paramount investors. Additionally, at least $2 million was paid to Cummings or used to pay his personal and business expenses. In the Fall of 2000, Deyak solicited and/or referred clients to participate in Paramount investments. After conducting very little, if any, due diligence, Deyak misrepresented to clients and investors that Cummings managed a hedge fund with assets of between $12 and $15 million, that he had participated in deals with Cummings in the past, and that Cummings' operations were legitimate. Deyak did not disclose to his registered broker-dealer employer that he had solicited investors for Paramount in exchange for fees and commissions. Finally, the Complaint alleged that Cummings paid Deyak approximately $184,500 for soliciting and inducing clients and others to invest in the Paramount scheme.

A hearing will be scheduled before an administrative law judge to determine whether the allegations contained in the Order are true, to provide Deyak an opportunity to dispute these allegations and to determine what, if any, remedial sanctions should be imposed against Deyak. The Commission directed that an administrative law judge shall issue an initial decision in this matter within 210 days from the date of service of the Order.