Securities and Exchange Commission
Litigation Release No. 17901 / December 18, 2002, 2002
SEC v. BigPlayStocks.com, Inc. and John R. Luers, Civil Action No. 01-CV-949 (E.D. Wis.)
The U.S. Securities and Exchange Commission announced today that on December 10, 2002, a federal court entered a final judgment that permanently enjoins John R. Luers ("Luers") and BigPlayStocks.com, Inc. ("BPS") from violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The court also ordered Luers to pay a civil penalty of $110,000.
From early 1999 until October 2002, Luers operated the internet website, www.bigplaystocks.com, billing himself "the Stock Jock." Through the site, he provided paid subscribers with stock-trading recommendations. The Commission's complaint alleged that Luers represented to subscribers that the recommendations were produced by a staff of multiple professional traders, when in fact Luers alone produced them and was not a professional trader. The complaint also alleged that Luers falsely represented that the recommendations were highly successful and that he frequently made and profited from the recommended trades. The complaint further alleged that Luers operated a fake "live trading room" on the site, claiming that this feature allowed subscribers to observe and mimic him as he made profitable trades in "real time" when most of the trades were actually hypothetical.
Luers and BPS never answered the complaint, which was filed in September 2001. The Commission obtained the judgment in default proceedings, based on the complaint's unanswered allegations. (For more detail on case, see Litigation Release No. 17147.)