U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23213 / March 3, 2015
Securities and Exchange Commission v. Ahmad Fnaikher Alyasin and Optima Global Financial, Inc., Civil Action No. 4:15-cv-00566
SEC Files Fraud and Related Charges Against Optima Global Financial, Inc., Its CEO, Ahmad Alyasin, and Their Lawyer Gary Patterson
The Securities and Exchange Commission today announced that, on March 3, 2015, the Commission filed fraud and other related charges against Optima Global Financial, Inc. ("Optima"), its CEO, Ahmad Fnaikher Alyasin ("Alyasin"), and, on March 3, 2015, against their lawyer Gary Eugene Patterson ("Patterson").
The Commission's Order finds and its complaint alleges that, from at least September 2010 through at least March 2011, Alyasin and Optima engaged in a fraudulent scheme to obtain and sell purportedly unrestricted shares of China North East Petroleum Holdings Limited ("CNEP") in unregistered transactions. Their attorney, Patterson, issued two baseless Rule 144 legal opinions, allowing the restrictive legends to be improperly removed from the securities. Alyasin and Optima loaned $3.5 million to the former Chief Executive Officer and President and current director of CNEP ("Borrower"). The loan was secured by a pledge of 2.5 million shares of restricted CNEP control stock. Under the provisions of the lending agreements, Alyasin and Optima agreed not to sell those restricted shares for the term of the loan.
According to the Commission's Order and complaint, Alyasin and Optima, however, immediately took steps to remove the restrictive legends from the shares, allowing them to margin and then, in contravention of the federal securities laws and the stated terms of the lending agreements, to sell those securities into the open market. Patterson caused this fraudulent scheme by issuing two baseless Rule 144 opinion letters incorrectly stating that the restrictive legends on the CNEP stock certificates could be removed based on the terms of the lending agreements.
By engaging in the unregistered offer and sale of securities, the Commission alleges in its complaint that Alyasin, Optima, and Patterson each violated the registration requirements of Sections 5(a) and (c) of the Securities Act of 1933 ("Securities Act"). In addition, Alyasin and Optima are alleged to have violated Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 by engaging in the fraudulent scheme, and Patterson caused Alyasin's and Optima's violations of those antifraud provisions.
Without admitting or denying the findings, Patterson agreed to settle the SEC's claims against him. As part of his settlement with the Commission, Patterson, consented to the issuance of an order that requires him: (1) to cease-and-desist from committing or causing any violations and any future violations of Sections 5(a), 5(c), and 17(a) of the Securities Act, Section 10(b) of the Exchange Act, and Rule 10b-5 thereunder; (2) to pay a civil penalty of $30,000. In addition, the order prohibits Patterson from providing professional legal services to any person or entity in connection with the offer or sale of securities, including, without limitation, participating in the preparation of any opinion letter related to such offerings; and bars him from appearing or practicing as an attorney before the Commission for ten years.
Alyasin and Optima agreed to a bifurcated settlement whereby they, without admitting or denying the allegations, consent to: (1) the entry of a final judgment permanently enjoining them from violating Sections 5(a), 5(c), and 17(a) of the Securities Act, Section 10(b) of the Exchange Act, and Rule 10b-5 thereunder, and (2) the entry of a final judgment imposing disgorgement of ill-gotten gains along with prejudgment interest, and civil penalties in amounts, if any, to be determined by the Court upon motion of the Commission.
The SEC's investigation was conducted by Ansu Banerjee and Delane Olson, and supervised by Melissa Hodgman. The litigation will be led by John Bowers.
See Administrative Proceeding No. 33-9735 (March 3, 2015)