SEC Charges Issuer for Conducting Fraudulent and Unregistered Securities Offerings

Litigation Release No. 25531 / September 28, 2022

Securities and Exchange Commission v. Pebblekick, Inc., Donald Shiroishi, and Nancy Williams, No. 2:22-cv-06984 (C.D. Cal. filed September 27, 2022)

The Securities and Exchange Commission today announced charges against California-based Pebblekick, Inc. and its founder and former CEO, Donald Shiroishi, for allegedly defrauding investors in unregistered offerings of securities.

The SEC's complaint, filed in the United States District Court for the Central District of California, alleges that, from at least January 2018 through March 2021, Pebblekick, which is in the business of providing streaming entertainment to residents of institutions, including prisons, raised over $17 million from equity and promissory note investors. The complaint alleges that Shiroishi represented that the purpose of the notes was to finance the acquisition of intellectual property that Pebblekick would use in its business. Instead, according to the complaint, Shiroishi misappropriated a substantial amount of investor funds to pay putative returns and principal on earlier investments. The SEC also alleges that Pebblekick did not register its offers or sales of securities with the Commission. In addition, the SEC's complaint alleges that Nancy Williams illegally acted as an unregistered broker in selling Pebblekick securities to investors.

The SEC's complaint charges Pebblekick and Shiroishi with violating the registration and antifraud provisions of Sections 5 and 17(a) of the Securities Act of 1933 ("Securities Act") and Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder. Williams is charged with violating Section 5 of the Securities Act and Section 15(a)(1) of the Exchange Act.

The SEC's investigation was conducted by Jasmine Starr and Christopher Conte and supervised by Spencer Bendell and Rhoda Chang of the Los Angeles Regional Office. The SEC's litigation will be led by Gary Leung.