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U.S. Securities and Exchange Commission

SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 16908 / February 26, 2001

SECURITIES AND EXCHANGE COMMISSION v. EDWARD GURIN, JOSHUA GURIN AND TRINARC CORPORATION, 01 Civ. 1649 (WK) (S.D.N.Y.)

The Securities and Exchange Commission filed today a Complaint in the United States District Court for the Southern District of New York charging Edward Gurin; his father, Dr. Joshua Gurin; and Edward Gurin's start-up company, Trinarc Corporation, with various schemes to defraud purchasers of unregistered, and in some cases non-existent, securities of private companies. The Commission simultaneously filed an emergency application asking the Court, among other things, to (1) temporarily and preliminarily enjoin defendants Edward Gurin and Trinarc Corporation, who are presently conducting a fraudulent offering of securities, from committing the violations alleged in the Complaint, (2) freeze assets of Edward Gurin and Trinarc Corporation, (3) direct Edward Gurin and Trinarc Corporation to provide accountings, (4) order Edward Gurin to repatriate assets held outside the United States, and (5) permit expedited discovery and prohibit the destruction of documents. The Commission alleges that through the various schemes, the defendants collectively raised over $1.2 million from at least eight investors.

Named in the Complaint are:

Edward Gurin, 26-years old, lives in New York, New York and is the chief executive of defendant Trinarc Corporation. Gurin was associated with The Thermopylae Group, Inc., a now defunct broker-dealer, from December 1999 to June 2000, and served as that firm's president and general securities principal. Gurin was associated with other broker-dealers from September 1997 to April 2000.

Dr. Joshua Gurin, Edward Gurin's father, is a retired physician living in New York. According to several investors, Joshua Gurin touted Edward Gurin as a financial genius who has handled investments for many famous people.

Trinarc Corporation ("Trinarc"). Trinarc was incorporated in Delaware in April 2000 and is not registered with the Commission. Trinarc's principal place of business is 350 Fifth Avenue, Room 6907, New York. In August 2000, Trinarc filed a Form D with the Commission to raise approximately $3 million from the sale of securities purportedly exempt from registration. According to a private placement memorandum for Trinarc securities dated August 9, 2000, Trinarc "creates and sells high-performance, low cost multimedia computers for the home, educational, business and institutional markets." According to Trinarc's Form D, Edward Gurin is a Beneficial Owner, Director and Executive Officer of Trinarc and 61.50%. His parents jointly own 14.14% of Trinarc's authorized stock.

The Complaint alleges that:

Over the past several weeks, Edward Gurin has sought to raise several hundred thousand dollars from a prospective investor, "Mike Grippo," through two major misrepresentations in the offer of Trinarc stock. First, Edward Gurin has misrepresented that Trinarc has a contract to supply $35 million worth of computers to schools in Mexico as part of an arrangement involving the United States Department of Commerce, International Business Machines Corporation, and an initiative supposedly called "e-NAFTA." In fact, Trinarc has no such contract. Second, Edward Gurin has represented that Trinarc is planning an initial public offering ("IPO") for the autumn of 2001, has received a letter of intent from Credit Suisse First Boston Corporation ("CSFB") to underwrite the offering, and has secured the interest of other investment banks. Neither CSFB, nor other investment banks mentioned by E. Gurin, have even heard of Trinarc, let alone signed a letter of intent to participate in an IPO for the company. "Mike Grippo" is actually an undercover agent of the FBI who has recorded Edward Gurin's fraudulent solicitations.

In addition, Edward and Joshua Gurin have made similar misrepresentations in earlier offerings. In late 1999, they obtained $300,000 from an investor by purporting to sell him Trinarc common stock and by predicting that Trinarc would launch an IPO in 2001 at $10 per share. At the time, Trinarc was not even incorporated, let alone sufficiently developed to support predictions of an IPO or price projections of $10 per share. During the spring of 2000, Edward Gurin, aided by Joshua Gurin, fraudulently raised at least $755,000 from several investors by selling them warrants purportedly issued by Actium. The offering was a sham because Actium never issued any warrants. Not only did the Gurins (a) lie about the existence of these securities, but they also (b) falsely represented that Actium was being acquired by a German company, "Schering-Haas Ventures"; (c) baselessly promised that investors would double or triple their money in days or weeks; and (d) claimed that investor funds were guaranteed, would be held in escrow or in an account in Great Britain, and would be returned in days - when, in fact, the money soon disappeared after being deposited into accounts of the Gurins and into an account at a Nigerian bank. Through similar lies, the Gurins also defrauded investors into buying Actium common stock in 1999 and investing in warrants of a supposed "Devon Asset Management LTD." in the spring of 2000.

As a result of the foregoing, the Commission alleges that Edward Gurin, Joshua Gurin, and Trinarc committed securities fraud in violation of Section 17(a) of the Securities Act of 1933, 15 U.S.C. § 77q(a), 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. In addition to the interim relief sought in the application filed today, the Commission seeks a Final Judgment against the defendants: (i) enjoining them from future violations of the above-cited provisions; (ii) requiring the disgorgement of all of their ill-gotten gains, plus pre-judgment interest; and (iii) assessing civil penalties against them.

The Commission acknowledges the assistance of the United States Attorney's Office for the Southern District of New York and the FBI in this matter. The Commission's action is pending against all parties.

http://www.sec.gov/enforce/litigrel/lr16908.htm


Modified:02/26/2001