UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
SECURITIES EXCHANGE ACT OF 1934
Release No. 50358 / September 13, 2004
Administrative Proceeding File No. 3-11646
SEC INSTITUTES PENNY STOCK BAR PROCEEDING AGAINST ROBERTO E. VEITIA, FORMER PRESIDENT AND CHAIRMAN OF THE BOARD OF CORPORATE RELATIONS GROUP, INC., BASED ON ENTRY OF INJUNCTION
The Commission issued today an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 (Exchange Act) (Order) against Roberto E. Veitia (Veitia) to determine whether it is appropriate and in the public interest to bar Veitia from participating in an offering of a penny stock. The Commission's proceeding is based on a final judgment entered against Veitia in Securities and Exchange Commission v. Corporate Relations Group (CRG), Inc., et al., (6:99-cv-1222-Orl-28KRS) (M.D. Fl.). The Commission's Complaint alleged that Veitia, the former president and chairman of the board of Corporate Relations Group, Inc. (CRG), a public relations firm formerly located in Winter Park, Florida, engaged in a fraudulent scheme to manipulate the stock of a number of public companies and, by doing so, violated Sections 5(a), 5(c), 17(a) and 17(b) of the Securities Act of 1933 (Securities Act), and Section 10(b) of the Exchange Act and Exchange Act Rule 10b-5. The Complaint also alleged that Veitia was liable for CRG's violations as a controlling person under Section 20 of the Exchange Act.
On May 13, 2003, the District Court for the Middle District of Florida, among other things, entered a final judgment against Veitia permanently enjoining him from violating Sections 5, 17(a) and 17(b) of the Securities Act, Section 10(b) of the Exchange Act and Exchange Act Rule 10b-5. The Court also found that Veitia was a controlling person of CRG. On March 2, 2004, the U.S. Court of Appeals for the Eleventh Circuit affirmed the District Court's ruling.
In the Commission's Order, the Division of Enforcement (Division) alleges that the securities of at least one of the companies that Veitia and CRG promoted, Tracker Corporation of America, constituted a penny stock within the meaning of Section 3(a)(51) of the Exchange Act and Exchange Act Rule 3a51-1. Further, the Division alleges that Veitia, both individually and by virtue of his position as a controlling person of CRG, participated in an offering of a penny stock.
A hearing will be scheduled before an administrative law judge to determine whether the allegations contained in the Order are true, and in connection therewith, to afford Veitia an opportunity to establish defenses to such allegations, and to determine whether a penny stock bar is appropriate and in the public interest.
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 this Order.
By the Commission.
Jonathan G. Katz
See also the Order in this matter