Litigation Release No. 18225 / July 10, 2003
JUDGMENT OF PERMANENT INJUNCTION AND OTHER RELIEF ENTERED AGAINST WEB HOSTING HEADQUARTERS PARTNERSHIP
SECURITIES AND EXCHANGE COMMISSION V. WEB HOSTING HEADQUARTERS PARTNERSHIP, DONALD E. RHOADES, KENNETH R. GROSSFELD, WAYNE L. PRICHASON, EDUARDO VILLAR, AND KARYN MILLER, ET AL., Case No. 00-4975-CIV-HIGHSMITH-TURNOFF (S.D. Fla.)
The Securities and Exchange Commission (SEC) announced that on April 21, 2003, the United States District Court for the Southern District of Florida entered a Judgment of Permanent Injunction and Other Relief ("Judgment") against Web Hosting Headquarters Partnership ("Web Hosting or The Company"). The Judgment, entered by the consent of the Court-appointed Receiver for Web Hosting and without admitting or denying the allegations of the Complaint, enjoins The Company from violations of Sections 5(a), 5(c) and 17(a) of the Securities Act, Sections 10(b) of the Exchange Act, and Rule 10b-5 thereunder.
On December 28, 2000, the SEC filed an emergency action against Web Hosting and others seeking to enjoin the alleged ongoing fraudulent securities offering being conducted by Web Hosting and its principals and telemarketers. Among other things, the SEC's Complaint alleged that Web Hosting failed to disclose to investors that it was controlled by individuals with a prior history of defrauding investors, and that it had diverted at least 62% of funds raised from investors to pay its principals and telemarketers.
See also, Litigation Releases No. 16846 (December 29, 2000), No. 17202 (October 15, 2001), No. 17875 (December 6, 2002), and No. 18101 (April 23, 2003).