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COMMISSION ANNOUNCEMENTSSecurities and Exchange Commission Suspends Trading in Five Issuers for Failure to Make Required Periodic FilingsThe Commission announced the temporary suspension of trading in the securities of the following issuers, commencing at 9:30 a.m. EDT on Aug. 18, 2008, and terminating at 11:59 p.m. EDT on Aug. 29, 2008.
The Commission temporarily suspended trading in the securities of these five issuers due to a lack of current and accurate information about the companies because they have not filed periodic reports with the Commission in over three years. This order was entered pursuant to Section 12(k) of the Securities Exchange Act of 1934 (Exchange Act). The Commission cautions brokers, dealers, shareholders and prospective purchasers that they should carefully consider the foregoing information along with all other currently available information and any information subsequently issued by these companies. Brokers and dealers should be alert to the fact that, pursuant to Exchange Act Rule 15c2-11, at the termination of the trading suspensions, no quotation may be entered relating to the securities of the subject company unless and until the broker or dealer has strictly complied with all of the provisions of the rule. If any broker or dealer is uncertain as to what is required by the rule, it should refrain from entering quotations relating to the securities of these companies that have been subject to a trading suspension until such time as it has familiarized itself with the rule and is certain that all of its provisions have been met. Any broker or dealer with questions regarding the rule should contact the staff of the Securities and Exchange Commission in Washington, DC at (202) 551-5720. If any broker or dealer enters any quotation which is in violation of the rule, the Commission will consider the need for prompt enforcement action. If any broker, dealer or other person has any information which may relate to this matter, they should immediately communicate it to the Delinquent Filings Branch of the Division of Enforcement at (202) 551-5466, or by e-mail at DelinquentFilings@sec.gov. (Rel. 34-58371) SEC Announces $18 Million Fair Fund Distribution to Investors Affected by Undisclosed Market Timing in Janus Mutual FundsOn August 15, the Securities and Exchange Commission distributed more than $18 million to more than 325,000 investors who were affected by undisclosed market timing in certain mutual funds managed by Denver-based Janus Capital Management LLC (JCM). The distribution is the first in a series that will return approximately $100 million to harmed investors as part of the Commission's 2004 settlement with JCM. The firm had been charged with facilitating undisclosed market timing in some of its mutual funds. "This case provides a tremendous amount of satisfaction to our staff as we are able to provide funds to hundreds of thousands of harmed investors," said Dick D'Anna, Director of the SEC's Office of Collections and Distributions. "We look forward to completing the full distribution in the coming months." Donald M. Hoerl, Acting Regional Director of the SEC's Denver Regional Office, said, "We are very pleased to begin distributing money in the Fair Fund to Janus investors harmed by market timing misconduct. This distribution is another example of the Commission's ongoing commitment to return money to injured investors." The Fair Fund provision of the Sarbanes-Oxley Act of 2002 provides the SEC with authority to distribute financial penalties along with disgorgement to injured investors. Since 2002, more than $4 billion has been returned to investors. The SEC brought and settled public administrative and cease-and-desist proceedings in 2004 against JCM. Without admitting or denying the Commission's allegations, JCM consented to a Commission Order charging anti-fraud violations and requiring the respondents to pay $50 million in disgorgement and $50 million in civil penalties for distribution through a Fair Fund. In addition to disgorgement and civil penalties, JCM also consented to a cease-and-desist order and a censure, and agreed to undertake certain compliance and mutual fund governance reforms. The Fair Fund Administrator responsible for distribution is Rust Consulting, Inc. Investor questions regarding the distribution may be directed to Rust at (800) 419-5292. Information regarding the distribution can also be obtained at http://www.JCMFairFund.com. Additional materials:Modified Plan of Distribution: April 25, 2008 Order Approving the Modified Plan of Distribution: August 18, 2004 Order Instituting Administrative and Cease-and-Desist Proceedings: For more information, contact: Donald M. Hoerl, Acting Regional Director, or Amy Norwood, Assistant Regional Director, SEC's Denver Regional Office , at (303) 844-1000. (Press Rel. 2008-177) SEC Announces Fair Fund Distribution to Harmed Investors in Putnam Mutual FundsThe Securities and Exchange Commission today announced the distribution of nearly $40 million to more than 600,000 investors who were harmed by undisclosed market timing and excessive short-term trading in certain mutual funds managed by Putnam Investment Management, LLC. This is the first in a series of Fair Fund distributions that will ultimately return a total of more than $150 million to more than 1.5 million affected Putnam mutual fund investors. "The SEC is privileged to play a role in bringing some measure of monetary relief to Putnam mutual fund shareholders," said David Bergers, Director of the SEC's Boston Regional Office. Dick D'Anna, Director of the SEC's Office of Collections and Distributions, added, "These payments exemplify the SEC's commitment to dealing with the complications inherent in processing Fair Fund distributions to large and diverse groups of investors, in this case more than 1.5 million investors who held mutual fund shares over a span of several years." The Sarbanes-Oxley Act of 2002 provided the SEC with authority to increase the amount of money returned to injured investors by allowing financial penalties to be included in Fair Fund distributions. Prior to Sarbanes-Oxley, only disgorgement could be returned to investors. Since 2002, SEC enforcement actions have resulted in the return of more than $4 billion to harmed investors. In October 2003, the SEC and the Massachusetts Securities Division brought separate administrative proceedings against Putnam. In these proceedings, which were fully settled in April 2004, Putnam agreed to pay disgorgement and financial penalties and to implement certain compliance, mutual fund governance, and employee trading reforms. The Fair Fund distribution is comprised of money that Putnam paid to settle both the SEC and Massachusetts actions. The SEC acknowledges the assistance and involvement of the Massachusetts Securities Division throughout the distribution process. For more information about the administration of the Fair Fund distribution, please visit http://www.putnam.com/individual/fair_fund or call 1-800-848-9697. Additional materials:Distribution Plan: Order Approving Modified Distribution Plan: Orders Imposing Remedial Sanctions: For more information, contact: David P. Bergers, Regional Director, or John T. Dugan, Associate Regional Director, SEC's Boston Regional Office, at (617) 573-8900. (Press Rel. 2008-178) ENFORCEMENT PROCEEDINGSCommission Orders Hearings on Registration Revocation Against Five Delinquent Companies for Failure to Make Required Periodic FilingsOn August 15, the Commission instituted public administrative proceedings to determine whether to revoke or suspend for a period not exceeding twelve months the registration of each class of the securities of five companies for failure to make required periodic filings with the Commission:
In this Order, the Division of Enforcement (Division) alleges that the five issuers are delinquent in their required periodic filings with the Commission. In this proceeding, instituted pursuant to Exchange Act Section 12(j), a hearing will be scheduled before an Administrative Law Judge. At the hearing, the judge will hear evidence from the Division and the respondents to determine whether the allegations of the Division contained in the Order, which the Division alleges constitute failures to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 or 13a-16 thereunder, are true. The judge in the proceeding will then determine whether the registrations pursuant to Exchange Act Section 12 of the securities of these respondents should be revoked or suspended for a period not exceeding twelve months. The Commission ordered that the Administrative Law Judge in this proceeding issue an initial decision not later than 120 days from the date of service of the order instituting proceedings. (Rel. 34-58368; File No. 3-13134) Commission Orders Hearings on Registration Suspension or Revocation Against Eight Companies for Failure to Make Required Periodic FilingsIn conjunction today's trading suspension, the Commission today also instituted a public administrative proceeding to determine whether to revoke or suspend for a period not exceeding twelve months the registration of each class of the securities of eight companies for failure to make required periodic filings with the Commission:
In the Order, the Division of Enforcement (Division) alleges that the respective respondents are delinquent in their required periodic filings with the Commission. In this proceeding, instituted pursuant to Exchange Act Section 12(j), a hearing will be scheduled before an Administrative Law Judge. At the hearing, the judge will hear evidence from the Division and the respondents to determine whether the allegations of the Division contained in the Order, which the Division alleges constitute failures to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder, are true. The judge in the proceeding will then determine whether the registrations pursuant to Exchange Act Section 12 of the securities of these respondents should be revoked or suspended for a period not exceeding twelve months. The Commission ordered that the Administrative Law Judge issue an initial decision not later than 120 days from the date of service of the order instituting proceedings. (Rel. 34-58372; File No. 3-13135) Commission Revokes Registrations of Securities of Two Issuers for Failure to Make Required Periodic FilingsOn August 18, the Commission instituted and settled separate administrative proceeding pursuant to Section 12(j) of the Securities Exchange Act of 1934 (Exchange Act) revoking the registration of each class of registered securities of each of the following issuers for failure to make required periodic filings with the Commission (ticker symbols provided).
Without admitting or denying the findings of the order pertaining to that issuer, except as to jurisdiction, which each admitted, each of the foregoing issuers separately consented to the entry of an order pertaining to that issuer finding that it had failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder and revoking the registration of each class of the issuer's securities pursuant to Exchange Act Section 12(j). Brokers and dealers should be alert to the fact that Exchange Act Section 12(j) provides, in pertinent part, as follows: No member of a national securities exchange, broker, or dealer shall make use of the mails or any means or instrumentality of interstate commerce to effect any transaction in, or to induce the purchase or sale of, any security the registration of which has been and is suspended or revoked . . . . (In the Matter of Ajay Sports, Inc. - Rel. 34-58373, File No. 3-13136; In the Matter of Heritage American Resource Corp. (n/k/a St Andrew Goldfields Ltd.) - Rel. 34-58374, File No. 3-13137) Commission Declares Decision as to Clarence Friend FinalThe decision of an administrative law judge barring Clarence Friend from associating with any broker or dealer has become final. Friend, of Fountain Valley, California, was the founder, controlling shareholder and former CEO of AirTrac, Inc. On April 2, 2008, the district court entered a Second Revised Final Judgment, permanently enjoining him from violations of Section 5 and 17(a) of the Securities Act of 1933, Sections 10(b) and 15(a) of the Securities Exchange Act of 1934, and Exchange Act Rule 10b-5. The court imposed civil penalties in the amount of $130,000 each against Friend and AirTrac and disgorgement in the amount of $273,487.87 against Friend and $1,759, 542.28 (less any amount Friend disgorges) against AirTrac, plus prejudgment interest on the disgorgement amounts. See SEC v. AirTrac, Inc., Civil Action No. SACV 06-582 (RNBx)(C.D. Cal.) Friend, along with employees of AirTrac, used scripts that had been approved by Friend, to tell investors through correspondence and via telephone, that AirTrac would take part in an initial public offering and public trading on the NASDAQ in late 2004 or early 20005. Friend further perpetrated the lie by telling an investor that, as early as 2003, AirTrac had filed a Form 10 with the Commission. AirTrac had never applied for a listing with the NASDAQ nor had it filed a Form 10 or Form 10-SB, which could have been filed in lieu of the Form 10. AirTrac employees further attempted to mislead several investors through the use of Friend-approved false scripts that stated that AirTrac was in the process of negotiating lucrative business contracts with widely-known telecommunications companies, such as SBC, Cingular and AT&T. Between January 2004 and April 2005, investors received copies of AirTrac's private placement memorandum, which represented that their invested funds would be utilized for business activities, when, in fact, Friend used $273,487.87 of the funds for personal expenses. (Rel. 34-58370; File No. 3- 13017) In the Matter of Mitchell M. Maynard and Dorice A. MaynardAn Administrative Law Judge has issued an Initial Decision in Mitchell M. Maynard and Dorice A. Maynard, finding that the allegations in the Order Instituting Proceedings are true that the State of Vermont's Department of Banking, Insurance, Securities, and Health Care Administration found that Mitchell M. Maynard and Dorice A. Maynard (together, Respondents) violated various provisions of Vermont's securities statutes and barred Respondents from association or employment with a registered broker-dealer or investment adviser or any "federal covered" investment adviser, required Respondents to pay $400,000 in restitution, and imposed a $20,000 administrative penalty. Based on these findings, the Administrative Law Judge found it to be in the public interest to bar each of the Respondents from association with an investment adviser. (Initial Decision No. 354; File No. 3-13008) SEC Settles Civil Injunctive Action with Bryan S. Behrens and His Company National Investments, Inc.The Commission announced today that on July 28, 2008, the Honorable Laurie Smith Camp of the United States District Court for the District of Nebraska entered a judgment by consent against Bryan S. Behrens and his company National Investments, Inc. The Commission's complaint, filed on Jan. 10, 2008, alleged that from at least year 2002, Behrens operated a fraudulent Ponzi-like investment scheme that succeeded in raising at least $6.5 million from investors, some of whom are senior citizens, and that he misappropriated more than $3.5 million of investor funds for his personal use. Without admitting or denying the allegations in the Commission's complaint, Behrens and National Investments consented to the entry of a judgment that permanently enjoins them from violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder. Also pursuant to the judgment, Behrens and National Investments are obligated to pay disgorgement with prejudgment interest and a civil penalty in amounts yet to be determined. Further, the court appointed a receiver to locate, preserve and protect all assets that are subject to disgorgement and penalties, and to maximize returns to investors. The Commission acknowledges the assistance of The Financial Industry Regulatory Authority in this matter. For further information, please see Litigation Rel. No. 20427 (Jan. 10, 2008). [SEC v. Bryan S. Behrens, et al., Civil Action No. 8:08CV13 (D. Nebraska)] (LR-20685) SELF-REGULATORY ORGANIZATIONSImmediate Effectiveness of Proposed Rule ChangesA proposed rule change (SR-NASDAQ-2008-068) filed by The NASDAQ Stock Market, as modified by Amendment No. 1, to modify Rule 4770 to enhance trading in the NASDAQ Crossing Network has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of August 18. (Rel. 34-58357) A proposed rule change filed by the Chicago Stock Exchange relating to participant fees and credits (SR-CHX-2008-13) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of August 18. (Rel. 34-58362) Approval of Proposed Rule ChangeA proposed rule change (SR-Phlx-2008-50) filed by the Philadelphia Stock Exchange relating to the electronic handling of complex orders has been approved pursuant to Section 19(b)(2) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of August 18. (Rel. 34-58361) Proposed Rule ChangesThe American Stock Exchange filed a proposed rule change (SR-Amex-2008-65) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 to allow issuers voluntarily delisting ETFs and structured products to submit to the Exchange a letter from an authorized officer of the issuer rather than a board resolution. Publication is expected in the Federal Register during the week of August 18. (Rel. 34-58364) The New York Stock Exchange filed a proposed rule change (SR-NYSE-2008-52), and Amendment No. 1 thereto, pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 to modify the method by which it allocates and reallocates securities to specialist units and to establish an allocation system based on a single objective measure to determine a specialist unit's eligibility to participate in the allocation process. Publication is expected in the Federal Register during the week of August 18. (Rel. 34-58363) Accelerated Approval of Proposed Rule ChangeThe Commission granted accelerated approval to a proposed rule change (SR-NYSEArca-2008-81), as modified by Amendment No. 1 thereto, submitted by NYSE Arca, through its wholly owned subsidiary, NYSE Arca Equities, Inc., relating to listing and trading of four CurrencyShares Trusts. Publication is expected in the Federal Register during the week of August 18. (Rel. 34-58365) SECURITIES ACT REGISTRATIONSRECENT 8K FILINGS
http://www.sec.gov/news/digest/2008/dig081808.htm
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