SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 16726 / September 27, 2000
SECURITIES AND EXCHANGE COMMISSION V. BRYCAR FINANCIAL CORPORATION AND BRYAN J. EGAN, DEFENDANTS, AND CAROL A. EGAN, RELIEF DEFENDANT, Civil Action No. CV-S-00-1125-LDG-LRL (D. Nev.)(LDG) (September 19, 2000)
SEC OBTAINS PRELIMINARY INJUNCTION AGAINST UNREGISTERED BROKER-DEALER BRYCAR FINANCIAL CORPORATION TO PROTECT INVESTOR FUNDS
On September 26, 2000, the Honorable Lloyd D. George of the U.S. District Court for the District of Nevada issued a preliminary injunction prohibiting a Las Vegas, Nevada company, BryCar Financial Corporation and its president, Bryan J. Egan ("Egan"), from engaging in fraudulent activities and offering or selling securities while failing to be registered with the Commission as a broker-dealer. Each of the defendants consented to the relief requested. The Court also continued the freeze it ordered on September 20, 2000 on the assets of BryCar, Egan and relief defendant Carol A. Egan, Egan's wife and the secretary of BryCar. BryCar conducted many of the activities that are the subject of this action over its Internet websites.
The Commission's complaint, filed on September 19, 2000, alleges that although neither defendant is registered to deal in securities, Egan purports to offer long- and short-term investment programs to consumers in several states through BryCar. The Complaint alleges that throughout this year, the defendants have held seminars at Las Vegas hotels, during which prospective customers were given dinner and then exhorted by Egan to invest in the BryCar programs. The Complaint alleges that Egan's sales pitch contained numerous materially false and misleading statements concerning BryCar and its purported investment programs.
In addition, according to the Complaint, the defendants have operated a website at www.brycar.com, on which the phony investment programs were promoted and which allowed customers to access equally fictitious account information.
The Complaint also alleges that on numerous occasions, Egan and Carol Egan have looted investor funds from BryCar's checking account to pay for consumer purchases, repeatedly transferred substantial sums from BryCar's account into bank and trading accounts in Egan's name, and made ATM withdrawals from BryCar's account.
As relief, the Commission sought a temporary restraining order, preliminary injunction, an asset freeze, an accounting and other emergency relief. The Commission also seeks a permanent injunction against future violations of the anti-fraud provisions of the Securities Act of 1933 (Section 17(a)) and the Securities Exchange Act of 1934 (Section 10(b) and Rule 10b-5), and the broker-dealer registration provisions of the Exchange Act (Section 15(a)), disgorgement, plus prejudgment interest, and the imposition of civil money penalties. For additional information, see litigation release number 16713 (September 20, 2000).
The Commission wishes to thank the Securities Division of the Nevada Secretary of State for its valuable assistance in this matter.