In the Matter of Newbridge Securities Corp., Guy S. Amico, Scott H. Goldstein, Eric M. Vallejo, and Daniel M. Kantrowitz
On April 10, the Commission issued an Order Making Findings and Imposing a Cease-and-Desist Order and Remedial Sanctions Pursuant to Section 8A of the Securities Act of 1933 and Sections 15(b) and 21C of the Securities Exchange Act of 1934 as to Daniel M. Kantrowitz. The Order finds that in 2003 and 2004, Kantrowitz engaged in the manipulation of two stocks and in the unregistered distribution of one of the stocks.
Based on the above, the Order directed Kantrowitz to cease and desist from committing or causing any violations and any future violations of the registration and antifraud provisions; ordered Kantrowitz to pay disgorgement of $217,000 plus prejudgment interest of $3,996.41, and a civil penalty of $50,000; and barred Kantrowitz from association with any broker or dealer and from participating in any offering of a penny stock. Kantrowitz consented to the issuance of the Order without admitting or denying the findings in the Order. (Rels. 33-9024; 34- 59749 File No. 3-13099)
In the Matter of Glenn Manterfield
On April 10, the Commission issued an Order Instituting Administrative Proceedings Pursuant to Section 203(f) of the Investment Advisers Act of 1940 and Notice of Hearing (Order) against Glenn Manterfield of the United Kingdom, based on the entry of an injunction in the civil action SEC v. Lydia Capital, LLC, et al., Civil Action No. 07-CV-10712-RGS, in the United States District Court for the District of Massachusetts.
On April 8, 2009, the United States District Court for the District of Massachusetts entered a Final Judgment of Permanent Injunction enjoining Manterfield 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, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940.
The Division of Enforcement alleges in the Order that the Commission's amended complaint alleged that from at least June 2006 through April 2007, Manterfield sold limited partnership interests and retained investors in Lydia Capital Alternative Investment Fund LP (the Fund) through a series of material misrepresentations and omissions, including but not limited to: (1) materially overstating, and in some instances completely fabricating the Fund's performance; (2) inventing business partners, offices, and investors in an attempt to legitimatize the firm and concealing the truth as to why key vendors and banks ceased relationships with the Respondent; (3) making material misstatements and omissions about Manterfield's significant criminal history, and failing to disclose a February 2007 criminal asset freeze in England; (4) making material misstatements and omissions about how the Fund planned to address certain material risks and failing to disclose others; and (5) misstating the nature of the Fund's assets and its investment process. The amended complaint also alleged that Manterfield misappropriated millions of dollars of investors' funds by withdrawing investor monies to which they were not entitled.
A hearing will be scheduled before an administrative law judge to determine whether the allegations contained in the Order are true, to provide Manterfield an opportunity to dispute the allegations, and to determine what, if any, remedial action is appropriate and in the public interest pursuant to Section 203(f) of the Advisers Act. The Order requires the Administrative Law Judge to issue an initial decision no later than 210 days from the date of service of the Order, pursuant to Rule 360(a)(2) of the Commission's Rules of Practice. (Rel. IA-2865; File No.3-13438).
Commission Voluntarily Dismisses All Claims Against Former General Counsel of McAfee Inc.
The Securities and Exchange Commission announced that on March 20, 2009, the United States District Court for the Northern District of California entered an order dismissing with prejudice all claims in this action against defendant Kent H. Roberts. The District Court's order was based upon the Commission's stipulation of dismissal voluntarily dismissing its claims against Roberts. [SEC v. Kent H. Roberts, United States District Court for the Northern District of California, Case No. C 07-04580 MHP (N.D. Cal.)] (LR-20995)
SEC Charges Ohio Investment Adviser With Defrauding Elderly Clients of $2.3 Million
The Securities and Exchange Commission filed a civil action on April 8, 2009, against Crossroads Financial Planning, Inc., and Julie M. Jarvis, of Columbus, Ohio, in connection with an alleged scheme by Jarvis to misappropriate funds from two elderly clients. Crossroads is an investment adviser registered with the Commission, and Jarvis is its president, chief operating officer and principal owner. The Commission's complaint, filed in the United States District Court for the Southern District of Ohio, alleges that Jarvis, the owner of Crossroads, misappropriated at least $2.3 million between June 2000 and March 2009.
According to the Commission's complaint, in or about May 2000, Jarvis first caused the unauthorized transfer of funds from a client's account at a brokerage firm. Over the course of the next nine years, through various means including forged and falsely notarized funds transfers instructions, Jarvis misappropriated funds from the investment accounts of the two elderly clients and used those funds for her personal expenses and benefit. In some instances, Jarvis had to liquidate securities to effect the fraudulent transfers.
The complaint, which seeks permanent injunctions, disgorgement and civil penalties, charges Jarvis and Crossroads with violations of 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, and it charges Crossroads with violating Section 204 of the Advisers Act and Rule 204-2 thereunder, and Jarvis with aiding and abetting those violations.
On April 9, 2009, Judge Algenon L. Marbley, U.S. District Judge for the Southern District of Ohio, granted the Commission's motion for a Temporary Restraining Order (TRO) and set the Preliminary Injunction hearing for April 22, 2009. In addition to enjoining the defendants from violating provisions of the Federal Securities laws, as charged by the Commission in its complaint, the TRO imposes a freeze on Jarvis's and Crossroads' assets. The Judge also ordered Jarvis to submit a financial accounting, and he granted the Commission's request for expedited discovery and other emergency relief.
The Commission notes the assistance and cooperation from the United States Attorney's Office for the Southern District of Ohio and the Federal Bureau of Investigation. [SEC v. Crossroads Financial Planning, Inc., and Julie M. Jarvis, Case No. 2:09-cv-269 (ALM) (SDOH)] (LR-20996)
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