Securities and Exchange Commission
Litigation Release No. 16290 / September 23, 1999
Securities and Exchange Commission v. Shane Vaessen, William McNamara, et al., (United States District Court, M.D. Fla., Civil Action No. 98-1964-CIV-T-26F)
The Securities and Exchange Commission ("SEC") announced that on January 19, 1999, the U.S. District Court for the Southern District of Florida in SEC v. Shane Vaessen, William McNamara, et al., Case No. 98-1964-CIV-T-26F (M.D. Fla.), permanently enjoined William McNamara ("McNamara"), by consent, from further violations of Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933, Section 15(a)(1) of the Securities Exchange Act of 1934 ("Exchange Act"), and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. The District Court also ordered McNamara to disgorge $53,572 in ill-gotten gains, but waived payment due to McNamara's demonstrated inability to pay the full amount.
In its civil lawsuit, the SEC charged that McNamara engaged in securities fraud in connection with sales of unregistered investment contracts issued by International Capital Corporation ("ICC 2000"), resulting in approximately $3.3 million in losses to over 100 investors residing in several states, including Florida. Specifically, the SEC alleged that McNamara engaged in securities fraud by providing prospective investors with misleading materials relating to the ICC 2000 investment contract and by making material misrepresentations which he knew, or was reckless in not knowing, were false, directly causing certain investors to place approximately $590,000.00 in ICC 2000 investment contracts. The documents McNamara used to sell the ICC 2000 investment contracts, some of which he prepared, contained false and misleading statements and/or omissions of material facts concerning the security and risk of ICC 2000 investment contracts, the accounts in which funds were deposited, and the investment of investor funds. On several occasions McNamara made oral representations to investors that he knew, or was reckless in not knowing, were false and likely to mislead the investors. In addition, in 1996, McNamara perpetuated the scheme with other Florida sales agents by fraudulently using a signature stamp and an ICC 2000 bank account to collect new investor funds for improper distribution to prior investors and to sales agents as commissions.