U.S. Securities and Exchange Commission
Litigation Release No. 18436 / October 30, 2003
SEC v. Paul J. Silvester et al. (United States District Court for the District of Connecticut, Civil Action No. 3:00 CV 1941 (SRU))
United States v. Triumph Capital Group et al. (United States District Court for the District of Connecticut, Criminal Action No. 3:00 CR 217 (EBB))
Commission Settles Fraud Charges Against Boston Investment Firm Consultant
The Securities and Exchange Commission announced today that on September 24, 2003, the Connecticut federal district court entered a final judgment against Lisa A. Thiesfield of Hartford, Connecticut, a former consultant for Triumph Capital Group, Inc., an investment firm headquartered in Boston, Massachusetts. The Commission's charges against Thiesfield arose out of an alleged fraudulent scheme involving the former Connecticut State Treasurer's investment of state pension fund money with private equity firms, including Triumph, in exchange for the firms' agreement to pay lucrative fees to the Treasurer's friends and associates. In a complaint filed against eleven defendants in the United States District Court for the District of Connecticut on October 10, 2000, the Commission alleged that Paul J. Silvester, the former Treasurer of the State of Connecticut, agreed to invest $200 million of state pension funds with Triumph in November 1998. The complaint alleged that in return, Triumph agreed to provide $1 million consulting contracts to Silvester's friends, Thiesfield and Christopher A. Stack. According to the complaint, Stack then funneled part of his Triumph consulting fees to Silvester through another intermediary, and Silvester also requested and expected to receive part of Thiesfield's Triumph consulting fees.
The Commission's complaint alleged that Thiesfield aided and abetted other defendants' violations of the federal securities laws. Thiesfield, without admitting or denying the allegations contained in the Commission's complaint, consented to the entry of final judgment permanently enjoining her from future violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940. The Commission also announced today that it has instituted related settled administrative proceedings in which Thiesfield was permanently barred from associating with any investment adviser.
On September 4, 2003, Thiesfield pleaded guilty to criminal charges stemming from the conduct described in the Commission's complaint. Thiesfield pleaded guilty to one charge of corruptly aiding and abetting a public official in accepting a reward. Under Thiesfield's plea agreement, the U.S. Attorney may seek up to $1 million in criminal penalties from her, subject to her ability to pay, and she may be sentenced to between 10-16 months in prison. She will be sentenced at a later date.
Silvester, Stack (and his entity, KCATS), and two other parties (Landmark Partners, Inc. and its chairman, Stanley F. Alfeld) previously settled with the Commission in this matter. The Commission's case remains pending against certain additional defendants. For further information, please see Litigation Release Numbers 16834 (December 19, 2000) and 16759 (October 10, 2000).