Litigation Release No. 19909 / November 15, 2006

Securities and Exchange Commission v. Robert A. Magnan, et al., Case No. 8:03-CV-321-T-27 TBM (M.D. Fla.)

Final Distribution Ordered

The Securities and Exchange Commission announced that on August 22, 2006, the Honorable James D. Whittemore of the Middle District of Florida entered a Final Order authorizing the distribution of disgorgement funds to defrauded investors and barring all future claims. Judge Whittemore allowed 32 claims, disallowed one claim and directed the transfer of $121,997.93 for distribution. The funds were distributed in September 2006.

Previously, in September 2005 the Commission notified 73 investors in Investment Recovery Network and its predecessor company, Global Investment Recovery Services (collectively IRN), of the availability of disgorged funds for distribution and the procedure for making claims of the funds. Subsequently, 33 of the investors submitted claims.

The Commission filed this lawsuit in February 2003, alleging in part that in connection with the offer and sale of IRN stock, Robert Magnan and IRN made a series of misrepresentations and omissions to prospective purchasers regarding IRN's past performance, likelihood of going public, and future projections. In October 2004, without admitting or denying any of the allegations of the Complaint, Magnan and IRN consented to the entry of an injunction against future violations of the anti-fraud and other provisions of the federal securities laws. The injunction against Magnan also ordered him to pay $125,000 in disgorgement into the Court Registry Investment System for distribution to defrauded IRN investors.

For further information, see Litigation Releases No. 17997 (February 25, 2003), No. 18287 (August 13, 2003), No. 18920 (October 6, 2004) and 18945 (October 27, 2004).