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U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 23719 /January 13, 2017

Securities and Exchange Commission v. Gregg R. Mulholland, No. 15-CV-03668 (E.D.N.Y.)

Court Enters Final Judgment Against Microcap Promoter Charged With Illegally Selling Penny Stock Shares

On January 11, 2017, the Honorable I. Leo Glasser of the U.S. District Court for the Eastern District of New York entered a final judgment against defendant Gregg R. Mulholland, a microcap promoter charged in an SEC action with illegally selling more than 83 million penny stock shares that he secretly obtained through at least 10 different offshore front companies.

The SEC's complaint, filed on June 23, 2015, alleged that Mulholland surreptitiously accumulated, through at least ten offshore front companies, at least 84% of the issued and outstanding shares of Vision Plasma Systems Inc. Once Mulholland effectively controlled the company through this majority ownership, he liquidated his shares for proceeds of at least $21 million. No registration statement was filed or in effect covering Mulholland's sales and no exemption from registration was available.

On May 9, 2016, Mr. Mulholland also pled guilty to money-laundering conspiracy charges in a parallel criminal case and is awaiting sentencing.

The judgment permanently enjoins Mulholland from violating, or causing violations of Sections 5(a) and (c) of the Securities Act of 1933 and also imposes conduct-based injunctions. The judgment also orders Mulholland to pay disgorgement and prejudgment interest of $24,659,355.57, which is to be deemed satisfied by the restitution order expected to be entered against Mulholland at sentencing in the parallel criminal case, conditioned upon the accuracy and completeness of his disclosures concerning his assets in that case.

Mulholland also consented to the entry of an SEC order, based on the court's entry of judgment, which imposes industry and penny stock bars.

The SEC appreciates the assistance of the U.S. Attorney's Office for the Eastern District of New York, the Federal Bureau of Investigation, the Internal Revenue Service, the Department of Homeland Security, and the Financial Industry Regulatory Authority.

See also Litigation Release No. 23293 (June 25, 2015).

 

https://www.sec.gov/litigation/litreleases/2017/lr23719.htm


Modified: 01/13/2017