UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
Securities Exchange Act of 1934
Release No. 50825 / December 9, 2004
Investment Advisers Act of 1940
Release No. 2336 / December 9, 2004
Admin. Proc. File No. 3-11768
IN THE MATTER OF KOJI GOTO
The Commission announced today that it has instituted public administrative proceedings against Koji Goto pursuant to Section 15(b) of the Securities Exchange Act of 1934 and Section 203(f) of the Investment Advisers Act of 1940. In the Order Instituting Administrative Proceedings ("Order"), the Division of Enforcement alleges that Goto, a former resident of Bedford, New Hampshire, was convicted in New Hampshire state court for criminal conduct he engaged in while associated with a broker-dealer and investment adviser.
From December 1994 until November 2001, Goto was employed in Concord, New Hampshire by subsidiaries of the John Hancock Financial Services Co., including Signator Investors, Inc., a registered investment adviser and broker-dealer, and Hancock- related insurance agencies as both a registered representative and licensed insurance broker. On or about February 20, 2004, a New Hampshire state grand jury indicted Goto on 68 counts for his role in several fraudulent schemes. The indictment charged that Goto committed theft by misapplication of property, theft by deception, criminal solicitation, unlawful securities practice, and witness tampering. The case was filed in New Hampshire Superior Court and is entitled State of New Hampshire v. Koji Goto, (Docket #04-S-0492-0559) (Superior Court, Hillsborough County-North).
Among other things, the indictment charged that Goto, beginning in June 1999 and continuing until March 2002, successfully solicited certain individuals to invest their money in purported Hancock investments. According to the indictment, Goto then gained control over that money, but never invested it with Hancock. Instead, Goto stole approximately $3.2 million from his purported Hancock clients. On September 27, 2004, Goto was found guilty by a jury in the criminal action of the 23 counts concerning the purported Hancock investments. The verdict found Goto guilty of: (a) nine counts of theft by deception in violation of New Hampshire Revised Statutes Annotated ("RSA") 637:4; (b) one count of theft by misapplication in violation of RSA 637:10; and (c) 13 counts of unlawful securities practice in violation of RSA 421-B:6.
A hearing will be held before an administrative law judge to determine whether the allegations contained in the Order are true, to provide the Respondent an opportunity to dispute these allegations, and to determine what, if any, remedial sanctions are 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 the Order Instituting Proceedings.