Securities and Exchange Commission Suspends Trading in the Securities of Six 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 Feb. 26, 2010, and terminating at 11:59 p.m. EST on March 11, 2010.
The Commission temporarily suspended trading in the securities of these six 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 two 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 companies 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. 34-61596)
Closed Meeting - Thursday, March 4, 2010 - 2:00 p.m.
The subject matter of the Closed Meeting scheduled for Thursday, March 4, 2010, will be: institution and settlement of injunctive actions; institution and settlement of administrative proceedings; and other matters relating to enforcement proceedings.
At times, changes in Commission priorities require alterations in the scheduling of meeting items. For further information and to ascertain what, if any, matters have been added, deleted or postponed, please contact: The Office of the Secretary at (202) 551-5400.
Commission Orders Hearings on Registration Suspension or Revocation Against Six Companies for Failure to Make Required Periodic Filings
In conjunction with today's trading suspension, the Commission also 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 six companies for failure to make required periodic filings with the Commission:
In this Order, the Division of Enforcement (Division) alleges that the six 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 thereunder, are true. The judge in the proceeding will then determine whether the registrations pursuant to Exchange Act Section 12 of each class 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. 34-61597; File No. 3-13793)
In the Matter of Tsukuda-America Inc.
An Administrative Law Judge has issued an Initial Decision in Tsukuda-America Inc., Admin. Proc. No. 3-13761, pursuant to Section 8(d) of the Securities Act of 1933, suspending the effectiveness of Tsukuda-America Inc.'s (Tsukuda) registration statement for a $600,000 stock offering that became effective on April 14, 2009. The Initial Decision finds that John Petros (Petros), Tsukuda's incorporator and sole officer and director, prepared and filed a registration statement for Tsukuda falsely representing that Weinberg & Company, P.A., Certified Public Accountants, audited Tsukuda's financial statements and consented to the inclusion of the audit report in Tsukuda's registration statement. Tsukuda did not appear at a hearing held on Feb. 9, 2010.
Tsukuda and Petros, reportedly located in Rockwall, Texas, are also the subject of an action in United States District Court for the Northern District of Texas, SEC v. Tsukuda-America Inc. and John W. Petros, No. 3:10-cv-00136-M (Jan. 26, 2010). The Complaint alleges that, in addition to his fraudulent activities in the Tsukuda registration, Petros prepared and submitted bogus audit and legal opinions and consents from nonexistent lawyers and accountants; fabricated corporate financial information; and falsely held himself out as an attorney issuing legal opinions as company counsel in registration and offering statements for Pioneer Capital Associates, Inc., Phoenix Gold Mining Corporation, Euro Capital Incorporated, and Lone Mountain Mining Company. (Initial Decision No. 394; File No. 3-13761)
George Georgiou Convicted of Securities Fraud and Other Charges Relating to Multimillion Dollar Market Manipulation Schemes
The Commission announced today that on Feb. 12, 2010, after a three week jury trial prosecuted by the United States Attorney's Office in Philadelphia, Pennsylvania, George Georgiou, of Toronto Ontario, was convicted of securities fraud, conspiracy, and wire fraud for his role in manipulating the market in four separate microcap stocks - Avicena Group, Inc., Neutron Enterprises, Inc., Hydrogen Hybrid Technologies, Inc., and Northern Ethanol, Inc. Sentencing is scheduled for May 7, 2010. Georgiou faces a maximum sentence of 165 years in prison and $21.25 million in fines.
The Commission previously filed a civil injunctive action against Georgiou based on similar conduct. According to the Commission's complaint, from 2004 through September 2008, Georgiou, who controlled the publicly-traded stock of each company, manipulated the market for the purpose of artificially inflating each company's stock price or to create the false appearance of an active and liquid market. In order to do so, Georgiou used many nominee accounts that he either directly or indirectly controlled at offshore broker-dealers and banks, and used a variety of manipulative techniques, including matched orders and wash sales. The Complaint alleges that ultimately, Georgiou realized at least $20.9 million in ill-gotten gains from his manipulation schemes through sales of artificially inflated stock and by using the artificially inflated stock as collateral to fraudulently obtain "margin" and other cash loans from Bahamian brokerage firms. The Commission's action, filed in the Eastern District of Pennsylvania on February 12, 2009 seeks a permanent injunction, disgorgement, prejudgment interest, civil penalties, and a penny stock bar against Georgiou. For more information, see LR-20899 (Feb. 12, 2009).
The Commission acknowledges the assistance of the Ontario Securities Commission, the Securities Commission of the Bahamas, and the Turks & Caicos Islands Financial Services Commission in connection with this matter. [U.S. v. George Georgiou, Criminal Action No. 09-88 (E.D. Pa.); SEC v. George Georgiou, Civil Action No. 09-CV-616 (E.D. Pa.)] (LR-21426)
INVESTMENT COMPANY ACT RELEASES
RidgeWorth Variable Trust
An order has been issued pursuant to Section 8(f) of the Investment Company Act declaring that RidgeWorth Variable Trust has ceased to be an investment company. (Rel. IC-29159 - February 24)
Accelerated Approval of Proposed Rule Changes
The Commission granted accelerated approval to a proposed rule change (SR-NYSE Amex-2010-13) submitted by the NYSE Amex under Section 19(b)(1) of the Securities Exchange Act of 1934 relating to changing certain NYSE Amex Equities rules to correspond with changes filed by the Financial Industry Regulatory Authority. Publication is expected in the Federal Register during the week of March 1. (Rel. 34-61556)
The Commission noticed and granted accelerated approval to a proposed rule change (SR-NYSE-2010-10) submitted by the New York Stock Exchange under Section 19(b)(1) of the Securities Exchange Act of 1934 relating to changing certain NYSE rules and rule interpretations to correspond with changes filed by the Financial Industry Regulatory Authority. Publication is expected in the Federal Register during the week of March 1. (Rel. 34-61557)
BATS Exchange filed, and the Commission has approved on an accelerated basis, a proposed rule change (SR-BATS-2010-003) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 to amend BATS Rule 5.5, entitled "Information Barrier Procedures," and to add new BATS Rule 12.13, entitled "Trading Ahead of Research Reports." Publication is expected in the Federal Register during the week of March 1. (Rel. 34-61574)
Immediate Effectiveness of Proposed Rule Changes
A proposed rule change filed by the Chicago Board Options Exchange (SR-CBOE-2010-016) to correct an inadvertent numbering inconsistency 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 March 1. (Rel. 34-61565)
A proposed rule change (SR-BX-2010-017) filed by NASDAQ OMX BX extending the effective date of the rule governing the Exchange's directed order process on the Boston Options Exchange has become effective under Section 19(b)(3)(A) under the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of March 1. (Rel. 34-61577)
A proposed rule change (SR-BX-2010-015) filed by NASDAQ OMX BX to codify certain provisions of the Options Listing Procedures Plan into the Rules of the Boston Options Exchange Facility 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 March 1. (Rel. 34-61579)
The Commission noticed a proposed rule change (SR-FINRA-2010-007) submitted by the Financial Industry Regulatory Authority (f/k/a National Association of Securities Dealers, Inc. (NASD)) pursuant to Rule 19b-4 under the Securities Exchange Act of 1934 to amend the By-Laws of NASD Dispute Resolution. Publication is expected in the Federal Register during the week of March 1. (Rel. 34-61575)
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