UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21434 / March 4, 2010
Securities and Exchange Commission v. Rodney E. Wallace, Joe B. Dorman and John A. Blank, Civil Action No. 3:10-cv-440 (United States District Court for the Northern District of Texas, Dallas Division).
SEC Charges Former North American Technologies Group, Inc.’s CEO, Rodney E. Wallace, with Misappropriating Over $538,000
On March 3, 2010, the Securities & Exchange Commission filed suit in U. S. District Court in Dallas against Rodney E. Wallace, former CEO of North American Technologies, Inc. (“NATG”) for misappropriating over $538,000. The Commission charged Wallace with violating or aiding and abetting violations of the antifraud, reporting, books and records, internal controls, lying to accountants and Sarbanes-Oxley certification provisions of the federal securities laws. The Commission also charged Joe B. Dorman, NATG’s general counsel and former acting CFO, and John A. Blank, NATG’s former controller, with aiding and abetting violations of the internal controls and books and records provisions.
The Commission alleges that between April and November 2008, Wallace misappropriated funds from NATG, mostly through reimbursement for fictitious purchases of raw materials he claimed to have made on NATG’s behalf. During the period in which Wallace misappropriated NATG’s funds, he falsely certified NATG’s third quarter Form 10-Q. Wallace also knowingly provided NATG’s auditors with phony documents in an attempt to substantiate his purported purchases. The complaint also alleges that Dorman and Blank authorized Wallace’s requests and recorded his purported purchases on NATG’s books without obtaining appropriate documentation.
Without admitting or denying the Commission’s allegations, Dorman and Blank have consented to settlements in which they agree to be enjoined from aiding and abetting future violations of the internal control and books and records provisions. Dorman also agrees to pay a $15,000 civil penalty. In a related administrative proceeding instituted pursuant to Section 12(j) of the Exchange Act, NATG consented to the revocation of its securities registration.
See Also: SEC Complaint