U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21982 / May 26, 2011
SEC v. ALFRED S. TEO, SR. AND M.A.A.A. TRUST, 04 Civ. 1815 (DNJ) (SW)
JURY FINDS ALFRED S. TEO, SR., LIABLE FOR SECURITIES FRAUD
On Wednesday, May 25, 2011, a jury in federal court in Newark, New Jersey, returned a verdict in favor of the U.S. Securities and Exchange Commission finding Alfred S. Teo, Sr. liable for securities fraud and disclosure violations under the Securities Exchange Act of 1934. The jury also found the M.A.A.A. Trust, a trust for Teo’s children, liable for disclosure violations under the Exchange Act. The Commission had charged that Teo and the M.A.A.A. Trust made false public filings with the Commission, and failed to make required filings, thereby materially misrepresenting their ownership of stock in the Musicland Stores Corporation.
The jury found that Teo violated Sections 10(b) and Rule 10b-5 thereunder and 13(d) of the Exchange Act. The jury also found that the M.A.A.A. Trust violated Sections 13(d) and 16(a) of the Exchange Act. The jury found the M.A.A.A. Trust not liable for violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. United States District Court Judge Susan D. Wigenton, who presided over the trial, previously granted the Commission’s motion for summary judgment with regard to Teo’s liability pursuant to Section 16(a) of the Exchange Act.
Teo, age 65, is a resident of Kinnelon, New Jersey and Fisher Island, Florida. The M.A.A.A. Trust is a resident of New Jersey.
Judge Wigenton will determine the relief. The Commission is seeking an injunction, disgorgement, prejudgment interest and civil penalties.
See also: L.R. 18673 (April 22, 2004)