Securities and Exchange Commission Suspends Trading in the Securities of Four Issuers for Failure to Make Required Periodic Filings
The U.S. Securities and Exchange Commission announced the temporary suspension of trading in the securities of the following issuers, commencing at 9:30 a.m. EST on Jan. 29, 2009, and terminating at 11:59 p.m. EST on Feb. 11, 2009:
The Commission temporarily suspended trading in the securities of these four 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 six 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 this company.
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 this company that has 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. 34-59314)
Commission Orders Hearings on Registration Suspension or Revocation Against Four Companies for Failure to Make Required Periodic Filings
In conjunction with 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 four 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 in this proceeding issue an initial decision not later than 120 days from the date of service of the order instituting proceedings. (Rel. 34-59315; File No. 3-13354)
In the Matter of Michael Lauer
An Administrative Law Judge has issued an Initial Decision in the Matter of Michael Lauer. The Initial Decision finds that the U.S. District Court for the Southern District of Florida entered an order and opinion finding that Michael Lauer (Lauer) violated Sections 17(a)(1), (2), and (3) of the Securities Act of 1933 (Securities Act), Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder, both individually and as a control person pursuant to Section 20(a) of the Exchange Act, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 (Advisers Act). Lauer has also been permanently enjoined from violating Section 17(a)(1)-(3) of the Securities Act, Section 10(b) and Rule 10b-5 of the Exchange Act, and Sections 206(1) and 206(2) of the Advisers Act. The Initial Decision concludes that, pursuant to Section 203(f) of the Advisers Act, it is in the public interest to bar Lauer from association with any investment adviser. (Initial Decision No. 369; File No. 3-13265)
Delinquent Filers' Stock Registrations Revoked
The registrations of the securities of Respondents The JPM Company, Maxxis Group, Inc., Metrotrans Corp., and Tidalwave Holdings, Inc., have been revoked. Each had repeatedly failed to file required annual and quarterly reports with the Securities and Exchange Commission. Thus, each violated a crucial provision of the federal securities laws that requires public corporations to publicly disclose current, accurate financial information so that investors may make informed decisions. The revocations were ordered in an administrative proceeding before an administrative law judge. (Rel. 34-59316; File No. 3-13336)
In the Matter of Michelle V. Nguyen (CPA)
On January 29, the Commission issued an Order Instituting Administrative Proceedings Pursuant to Rule 102(e) of the Commission's Rules of Practice, Making Findings, and Imposing Remedial Sanctions (Order) against Michelle V. Nguyen (CPA). The Order finds that on January 6, 2009, the United States District Court for the Central District of California entered a Final Judgment, by consent, permanently enjoining Nguyen, a CPA licensed in California and Maryland, from violating Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rules 10b-5 and Section 13b2-1 thereunder, and aiding and abetting violations of Sections 13(a) and 13(b)(2)(A) of the Exchange Act and Rules 12b-20 and 13a-13 thereunder, and ordering her to pay a $15,000 civil money penalty, in SEC v. Meridian Holdings, Inc., et al., CV 07-06335 DDP (SSx) (C.D. Cal.).
The Order finds that the Commission's Complaint alleged, among other things, that during the 2004 calendar year, Nguyen acted as Meridian's principal financial officer and interim chief financial officer for purposes of Meridian's public filings with the Commission and prepared the condensed consolidated financial information included in Meridian's quarterly reports filed with the Commission. The Commission's Complaint further alleged that Nguyen participated in a fraudulent scheme whereby a $30 million default judgment in Meridian's favor and interest thereon was recorded as an asset and income, resulting in materially false and misleading financial statements being included in Meridian's quarterly reports on Form 10-QSB for the second and third quarters of 2004. By recognizing the default judgment and interest thereon as income in its 2004 second and third quarter reports, Meridian reported positive earnings per share for each quarter, rather than losses. The default judgment constituted 85% of Meridian's total assets.
Based on the above, the Order suspends Nguyen from appearing and practicing before the Commission as an accountant. The Order further provides that after three years from the date of the Order Nguyen may request that the Commission consider her reinstatement to appear or practice before the Commission. Nguyen consented to the issuance of the Order without admitting or denying the findings in the Order, except she admitted the entry of the injunction. (Rel. 34-59317; AAE Rel. 2928; File No. 3-13355)
Proposed Rule Change
NYSE Arca filed a proposed rule change (SR-NYSEArca-2009-01) under Rule 19b-4 of the Securities Exchange Act of 1934 relating to reduction of annual fee for certain issues listed under Rule 5.2(j)(6). Publication is expected in the Federal Register during the week of Feb. 2, 2009. (Rel. 34-59270)
Immediate Effectiveness of Proposed Rule Changes
A proposed rule change filed by the Financial Industry Regulatory Authority (SR-FINRA-2009-001) relating to the exemptive criteria in FINRA Rule 7470 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 Feb. 2, 2009. (Rel. 34-59274)
A proposed rule change filed by BATS Exchange to Amend BATS Rule 2.5, entitled "Restrictions," and BATS Rule 11.4, entitled "Authorized Traders" (SR-BATS-2009-003) 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 Feb. 2, 2009. (Rel. 34-59292)
Accelerated Approval of Proposed Rule Change
The Commission granted accelerated approval to a proposed rule change (SR-OCC-2008-20) filed by the Options Clearing Corporation. The proposed rule change allows OCC to provide clearing services for stock loan and borrow transactions effected through electronic trading systems. Publication is expected in the Federal Register during the week of Feb. 2, 2009. (Rel. 34-59294)
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