Patrollers Capital Fund and Franklin S. Marone, Jr. and Relief Defendant Marita D. Marone

U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 20209 / July 25, 2007

Securities and Exchange Commission v. Patrollers Capital Fund and Franklin S. Marone, Jr. and Relief Defendant Marita D. Marone, Civil Action No. 04 Civ. 11227 (NRB) (S.D.N.Y.)

Final Judgments By Consents Entered As To Defendant Franklin S. Marone, Jr. and Relief Defendant Marita D. Marone

The Securities and Exchange Commission ("Commission") announced today that on July 20, 2007, the Honorable Naomi Reice Buchwald, United States District Judge for the Southern District of New York, entered Final Judgments by Consent against Defendant Franklin S. Marone, Jr. ("Marone") and his wife, Relief Defendant Marita D. Marone ("M. Marone"). Marone's Final Judgment enjoins him from future violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The Final Judgments also order the Court-appointed receiver, John Doyle III, to liquidate Marone and M. Marone's assets and transfer the proceeds to the Greene County, New York, Probation Department, to be applied toward Marone's $4,669,458.77 criminal restitution order issued in his parallel criminal case, People of the State of New York V. Franklin S. Marone, IND #04-039 (State of New York, Greene County, County Court) (September 14, 2004), brought by the Office of the New York State Attorney General. Marone and M. Marone consented to the entry of the judgments in the Commission's civil action without admitting or denying the allegations of the Commission's Complaint.

The Commission's Complaint filed on February 13, 2004, alleged that, between January 1999 and January 2004, Marone fraudulently obtained over $3.2 million from dozens of investors by inducing them to invest in several fictitious "equity funds" that Marone purported to manage. According to the Commission's Complaint, Marone falsely promised investors extraordinary returns at virtually no risk and sent investors falsified account statements reporting the value of their investments. In reality, the Complaint alleged, Marone never invested his victims' investment proceeds. Instead, Marone misappropriated investors' funds for his and his wife's personal use.