Former CEO and Coo of Plastics Manufacturer Plead Guilty to Fraud Charges
Litigation Release No. 24859 / July 29, 2020
SEC v. Kevin R. Kuhnash and Jason P. Jimerson, No. 19-CV-00028 (S.D Ind. filed Feb. 12, 2019)
United States v. Kevin Kuhnash and Jason Jimerson, No. 18-CR-078 (S.D. Ind.)
Two former executives of Indiana-based plastics manufacturer Lucent Polymers, Inc., who are defendants in ongoing SEC litigation, have pleaded guilty to criminal charges filed by the U.S. Attorney for the Southern District of Indiana. On June 18, 2020, Jason Jimerson, Lucent's former COO, pleaded guilty to two counts of securities fraud, one count of money laundering, and one count of making false statements to federal agents. On July 28, 2020, Kevin R. Kuhnash, Lucent's former CEO, pleaded guilty to two counts of securities fraud and one count of money laundering.
The SEC previously charged Kuhnash and Jimerson on February 12, 2019 for their roles in a scheme to conceal that Lucent's core business model was a sham in connection with the company's acquisition in 2013. According to the SEC's complaint, Lucent routinely lied to its customers and falsified its certifications of test data to show that its products complied with customer specifications, including on important aspects such as fire-retardant measures. Kuhnash and Jimerson allegedly hid Lucent's fraudulent practices, made misrepresentations to the company that acquired Lucent, and continued the fraud even after the sale of the business to secure future payments.
The SEC's litigation, which was stayed pending resolution of the criminal action, continues. The SEC's complaint charges Kuhnash and Jimerson with violating the antifraud provisions of the federal securities laws and seeks permanent injunctions, disgorgement plus prejudgment interest, civil monetary penalties, and officer-and-director bars.