U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23994 / November 20, 2017
Securities and Exchange Commission v. Inofin, Inc., Michael J. Cuomo, Kevin J. Mann, Sr., Melissa George, Thomas Kevin Keough, David Affeldt, and Nancy Keough, Civil Action No. 1:11-CV-10633 (D. Mass., Complaint Filed April 14, 2011)
Court Enters Final Judgment Against Massachusetts Company Responsible for Large Scale Securities Fraud
The Securities and Exchange Commission announced today that, on November 20, 2017, the U.S. District Court for the District of Massachusetts entered a final judgment in an enforcement action against Inofin, Inc., a Massachusetts-based subprime auto-financing company.
The SEC's complaint, filed in April 2011, alleged that Inofin and several of its executives illegally raised at least $110 million from hundreds of individual investors across the country through the sale of unregistered promissory notes and made material misrepresentations to those investors about the company's financial performance and how it was using investors' funds.
Inofin is now under the control of a bankruptcy trustee. Without admitting or denying the allegations in the SEC's complaint, Inofin's bankruptcy trustee consented to entry of a permanent injunction against Inofin prohibiting violations of Section 10(b) of the Securities Exchange Act of 1934 (the "Exchange Act"), and Rule 10b-5 promulgated thereunder, and Sections 5 and 17(a) of the Securities Act of 1933 (the "Securities Act").
Inofin was the last remaining defendant in the Commission's enforcement action against the company, its three principal executive officers, and two of its securities sales agents. The Commission previously obtained final judgments by consent against Inofin's former principal officers, President Michael Cuomo of Plymouth, Massachusetts, Chief Executive Officer Kevin Mann, Sr. of Marshfield, Massachusetts, and Chief Operating Officer Melissa George of Duxbury, Massachusetts and also against two of Inofin's sales agents, David Affeldt of Potomac, Maryland and Thomas Kevin Keough of North Reading, Massachusetts. These judgments ordered Cuomo, George, Mann, Affeldt and Keough to pay disgorgement and civil penalties and permanently enjoined them from violating relevant provisions of the Exchange Act and the Securities Act.
In related criminal proceedings, on April 2, 2015, a federal grand jury sitting in the District of Massachusetts indicted Cuomo and Mann, charging both with one count of wire fraud, three counts of mail fraud, and one count of conspiracy to commit mail and wire fraud. On May 25, 2017, Cuomo and Mann entered pleas of guilty to each count of the indictment. On October 20, 2017, the U.S. District Court for the District of Massachusetts sentenced Cuomo and Mann to terms of imprisonment of 48 months and 42 months, respectively, and ordered that both jointly and severally pay restitution in the amount of $10,186,018.
For further information, see Litigation Release No. 21929 (April 14, 2011), Litigation Release No. 22435 (August 6, 2012), Litigation Release No. 22667 (April 5, 2013), Litigation Release No. 23006 (May 28, 2014), Litigation Release No. 23212 (March 3, 2015), and Litigation Release No. 23315 (August 12, 2015).