U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23848 / May 26, 2017
Securities and Exchange Commission v. James H. Im, Civil Action No. 1:17-cv-03613 (S.D.N.Y.); Securities and Exchange Commission v. Kee Chan, Civil Action No. 1:17-cv-03605 (S.D.N.Y.)
Settlement Concluded With One Defendant in SEC Case Against Former Nomura Traders
The Honorable Loretta A. Preska of the United States District Court for the Southern District of New York entered a final consent judgment on May 16, 2017, against defendant Kee Chan, enjoining him from violating antifraud provisions of the federal securities laws and ordering him to pay $51,965 in disgorgement plus $11,758 in prejudgment interest and a $150,000 civil monetary penalty. Additionally, on May 19, 2017, the Securities and Exchange Commission issued an administrative order barring Chan from the securities industry with a right to reapply after three years. Chan consented to the issuance of the final judgment and administrative order without admitting or denying the allegations in the complaint. The SEC's separate case against defendant James Im continues.
The SEC charged Im and Chan, who ran the commercial mortgage-backed securities (CMBS) desk at Nomura Securities International Inc., with deliberately lying to customers in order to inflate the profits of the CMBS desk and line their own pockets as a result. The SEC alleges that Im and Chan each misrepresented price information while acting as intermediaries on trades with Nomura's customers who sought to buy and sell CMBS on the secondary market. The SEC's complaints, filed on May 15, 2017, charge Chan and Im with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5.