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U.S. Securities and Exchange Commission

UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

Securities Exchange Act of 1934
Release No. 50439 / September 24, 2004

Admin. Proc. File No. 3-11631


In the Matter of

FRANKLIN MARONE,

Respondent.



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ORDER MAKING FINDINGS AND IMPOSING REMEDIAL SANCTIONS PURSUANT TO SECTION 15(b) OF THE SECURITIES EXCHANGE ACT OF 1934 AGAINST FRANKLIN MARONE

I.

The Securities and Exchange Commission ("Commission") deems it appropriate to accept the Offer of Settlement ("Offer") submitted by Franklin Marone ("Marone" or "Respondent") pursuant to Rule 240(a) of the Rules of Practice of the Commission, 17 C.F.R. 201.240(a), for the purpose of settlement of public administrative proceedings instituted against him by the Commission on September 3, 2004 pursuant to an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 ("OIP").

II.

Solely for the purpose of this proceeding and any other proceedings brought by or on behalf of the Commission, or to which the Commission is a party, and without admitting or denying the findings herein, except as to the Commission's jurisdiction over him and the subject matter of these proceedings, and the findings contained in Section III.2, which are admitted, Marone consents to the entry by the Commission of this Order Making Findings and Imposing Remedial Sanctions Pursuant to Section 15(b) of the Securities Exchange Act of 1934 against Franklin Marone ("Order"), as set forth below.

III.

On the basis of the OIP and Respondent's Offer, the Commission finds that:

1. Marone was a registered representative of Generic Trading of Philadelphia ("Generic"), a broker-dealer registered with the Commission, during the relevant period, from November 1999 through October 2003. Marone, 41 years old, is formerly a resident of Fairfield, Connecticut and Windham, New York, and currently resides in Catskill, New York.

2. On February 13, 2004, the Commission filed a complaint in SEC v. Franklin Marone, et al. (Civil Action Number 04 Civ. 01227) in the United States District Court for the Southern District of New York. On February 26, 2004, by partial final judgment on consent, the court entered an order permanently enjoining Marone from future violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, as well as ordering disgorgement of ill-gotten gains and a civil penalty in amounts to be determined at a later date.

3. The Commission's Complaint alleges, among other things, that between January 1999 and January 2004, Marone induced at least 36 individuals to invest at least $3.2 million in Patrollers Capital Fund I, II, III, The Wedel Fund, and the Whistler Fund- fictitious equity funds that Marone purported to manage. The Complaint further alleges that Marone misappropriated virtually all of the investors' funds for his personal use and that of the relief defendant Marita Marone, falsely stated to investors that their funds were invested, disseminated false account statements indicating that investors' funds were fully invested and earning returns, and otherwise engaged in a variety of conduct which operated as a fraud and deceit upon investors.

IV.

In view of the foregoing, the Commission deems it appropriate and in the public interest to impose the sanctions specified in Respondent Marone's Offer.

Accordingly, it is hereby ORDERED:

Pursuant to Section 15(b) of the Securities Exchange Act of 1934, that Respondent Marone be, and hereby is, barred from association with any broker or dealer.

Any reapplication for association by the Respondent will be subject to the applicable laws and regulations governing the reentry process, and reentry may be conditioned upon a number of factors, including, but not limited to, the satisfaction of any or all of the following: (a) any disgorgement ordered against the Respondent, whether or not the Commission has fully or partially waived payment of such disgorgement; (b) any arbitration award related to the conduct that served as the basis for the Commission order; (c) any self-regulatory organization arbitration award to a customer, whether or not related to the conduct that served as the basis for the Commission order; and (d) any restitution order by a self-regulatory organization, whether or not related to the conduct that served as the basis for the Commission order.

For the Commission, by its Secretary, pursuant to delegated authority.

Jonathan G. Katz
Secretary


http://www.sec.gov/litigation/admin/34-50439.htm


Modified: 09/24/2004