Joseph P. Collins


Litigation Release No. 21555 / June 14, 2010

Accounting and Auditing Enforcement Release No. 3145 / June 14, 2010

U.S. Securities and Exchange Commission v. Joseph P. Collins, 07 CV 11343 (JSR) (S.D.N.Y. filed Dec. 18, 2007)


The U.S. Securities and Exchange Commission (the Commission) announced that on June 11, 2010, a settled final judgment was entered by the U.S. District Court for the Southern District of New York against Joseph P. Collins, a former partner with the law firm Mayer Brown LLP. The Commission's complaint in U.S. Securities and Exchange Commission v. Joseph P. Collins, 07 CV 11343 (JSR) (S.D.N.Y. filed Dec. 18, 2007), alleged that Collins aided and abetted a financial fraud by substantially assisting Refco Group Ltd. and its corporate successor Refco Inc. (hereinafter, together Refco) in their failure to disclose hundreds of millions of dollars in related party indebtedness. As alleged in the complaint, Collins, in the course of representing Refco, learned that an entity owned and controlled by Refco's chairman and chief executive officer owed Refco hundreds of millions of dollars. Collins also worked on, and oversaw other attorneys' work on, short-term related party transactions that occurred repeatedly at the end of Refco fiscal periods and temporarily shifted the related party indebtedness to unrelated third parties. The transactions were reversed shortly after the fiscal periods ended. The complaint further alleged that, notwithstanding his knowledge and awareness of the related party indebtedness and transactions, Collins reviewed and revised Refco disclosure documents that failed to mention these facts to potential investors.

The final judgment against Collins, to which he consented without admitting or denying the Commission's allegations, enjoins him from violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b 5 thereunder.

Collins was convicted in a related federal criminal prosecution of conspiracy, securities fraud, and wire fraud. In January 2010, Collins was sentenced to 7 years in prison.

The Commission acknowledges the assistance and cooperation of the Office of the United States Attorney for the Southern District of New York.

For further information about the Commission's action in U.S. Securities and Exchange Commission v. Collins, see Litigation Release No. 20402 (Dec. 18, 2007).