U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 19269 / June 14, 2005
Securities and Exchange Commission v. Miriam Santos, et al., United States District Court for the Northern District of Illinois, Eastern Division, Civil Action No. 02-8236.
District Court Enters Judgment Against Miriam Santos
The Securities and Exchange Commission announced that on June 7, 2005, the Honorable James B. Zagel of the U.S. District Court in Chicago, Illinois entered a final judgment against Miriam Santos, the former Treasurer of the City of Chicago. The Court entered the judgment pursuant to Santos' consent and without her admitting or denying the allegations of the Commission's complaint. The judgment against Santos permanently enjoined her from future violations of Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder. The judgment against Santos ordered her to pay disgorgement of $7,500, plus prejudgment interest on this amount, for a total of $11,371.34. The judgment also ordered Santos to pay a civil penalty of $30,000, which will be paid pursuant to a payment plan of three years due to her demonstrated inability to pay.
The Commission's complaint in this civil action alleged that, from 1995 to May 1999, two registered representatives associated with broker-dealers made secret cash payments to Santos, then-City Treasurer of the City of Chicago, to obtain a share of the City's lucrative securities investments. The complaint alleged that these two representatives paid thousands of dollars to Santos, who cut off other brokers who refused to make the contributions she solicited. The complaint alleged that Santos used part of the cash she collected from the two registered representatives to purchase office furniture for the campaign office she used in her run for Illinois Attorney General. The complaint alleged that, as a result of this conduct, Santos willfully violated Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.