SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 16360 / November 17, 1999
SECURITIES AND EXCHANGE COMMISSION v. ROBERT J. STRAUSS, United States District Court for the Northern District of Georgia, Civil Action No.199-CV-2965
A complaint was filed by the Commission on November 16, 1999, in the United States District Court for the Northern District of Georgia against Robert J. Strauss, a former vice president and portfolio manager of State Mutual Insurance Company (State Mutual), of Rome, Georgia.
The complaint alleges that from April 1995 through August 1997, Strauss fraudulently transferred over $16 million in funds and securities from State Mutual, of which Strauss misappropriated approximately $5.8 million. Strauss concealed his conduct by, among other things, falsifying entries on State Mutual's books and records, falsifying reports to State of Georgia regulatory authorities, and by making false representations to State Mutual's internal and external auditors. In addition, the complaint alleges that Strauss received kickbacks of approximately $3.2 million in money and/or stock for the unauthorized securities transactions and unauthorized transfers of money.
The complaint seeks a permanent injunction enjoining Strauss from future violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder. In addition, the Commission seeks that Strauss be barred from serving as an officer or director of any publicly held company.
Strauss, without admitting or denying the allegations made against him, has consented to a judgment of permanent injunction which enjoins him from future violations of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 and an order barring him from serving as an officer or director of any publicly held company. The Commission has filed a proposed final judgment with the court.http://www.sec.gov/litigation/litreleases/lr16360.htm