SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 16328 / October 5, 1999
SECURITIES AND EXCHANGE COMMISSION v. GOLF EMPORIUM CORPORATION AND FREDERICK TROPEANO, 99 Civ. 10259 (JSR) (S.D.N.Y.)
The Commission announced that it today filed a Complaint in the United States District Court for the Southern District of New York charging one individual and one corporation in connection with a fraudulent scheme targeted at elderly investors, which raised at least $640,000 through the sale of common stock in a purported private placement. The Commission simultaneously filed an emergency application seeking, among other things, an order temporarily restraining and preliminarily enjoining the defendants from committing the violations alleged in the Complaint and freezing the defendants' assets.
Named in the Complaint filed today are:
Golf Emporium Corporation ("Golf"), a New York corporation; and
Frederick Tropeano, Golf's 33 year-old president of Golf, who resides in Brooklyn, New York.
The Complaint alleges that, since January 1998, Defendants obtained at least $640,000 by using material misrepresentations to induce investors - many of whom are elderly - to buy Golf common stock. The Complaint alleges that Defendants Golf and Tropeano, directly and through salespeople under their control, fraudulently offered and sold Golf misrepresenting, among other things, that the price of Golf would appreciate to at least three times the "private placement" price following a purported imminent initial public offering of Golf stock.
As a result of the foregoing, the Commission alleges that Golf Emporium Corporation and Frederick Tropeano committed securities fraud in violation of Section 17(a) of the Securities Act of 1933,15 U.S.C. § 77q(a), and Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), and Rule 10b-5, 17 C.F.R. § 240.10b-5. The Commission seeks a Final Judgment against Frederick Tropeano and Golf Emporium Corporation: (i) permanently enjoining Defendants from future violations of the antifraud provisions; (ii) requiring Defendants to disgorge their ill-gotten gains plus pre-judgment interest; and (iii) assessing civil penalties.
The litigation is pending as to all defendants.