SEC Obtains Injunction, Industry Bar and Penny Stock Bar Against Unregistered Broker Engaged in Fraudulent Scheme
Litigation Release No. 25534 / September 28, 2022
Securities and Exchange Commission v. Joshua Rupp, No. 1:21-cv-643-HYJ-SJB (W.D. Mich.)
The Securities and Exchange Commission today announced that on August 24, 2022, the Honorable Hala Y. Jarbou, Chief United States District Judge for the Western District of Michigan, entered a final judgment against defendant Joshua Rupp. The final judgment permanently enjoins Rupp from violating the antifraud and broker registration provisions of the securities laws and orders him to pay disgorgement and prejudgment interest.
Additionally, on September 27, 2022, the SEC entered an order barring Rupp from the securities industry and from participating in any offering of penny stocks.
According to the SEC's complaint, Rupp engaged in a fraudulent investment scheme that raised over $2 million dollars from approximately 20 investors. The complaint alleged that Rupp made misstatements to investors and used fake documents purporting to show he was associated with a licensed broker dealer when he was not. The complaint also alleged that Rupp misappropriated investor funds.
Without admitting or denying the allegations in the SEC's complaint, Rupp consented to the entry of the final judgment permanently enjoining him from violating the antifraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act"), and Rule 10b-5 thereunder, as well as the broker-dealer registration requirements of Section 15(a) of the Exchange Act; and orders him to pay $603,671 in disgorgement and prejudgment interest, which was deemed satisfied by an order of restitution entered in a parallel criminal case.
Rupp also consented to entry of the Commission's Order barring him from association with any broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or national recognized statistical rating organization; and from participating in any offering of a penny stock. In the Matter of Joshua Lewis Rupp, Rel. No. 34-95935.pdf (sec.gov).
The SEC's investigation was conducted by Gosia Spangenbert, Ian Dattner, and Dan Furlano, and supervised by Lisa Deitch and Stacy Bogert of the Home Office. The litigation was handled by Derek Bentsen.