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COMMISSION ANNOUNCEMENTSSecurities and Exchange Commission Suspends Trading in the Securities of Fourteen Issuers for Failure to Make Required Periodic FilingsThe 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 Nov. 10, 2010 and terminating at 11:59 p.m. EST on Nov. 23, 2010.
The Commission temporarily suspended trading in the securities of these fourteen 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. 34-63295) James A. Clarkson, Director of Regional Office Operations in Enforcement Division, to Retire After 40 Years of ServiceThe Securities and Exchange Commission announced today that James A. Clarkson will retire from the agency at the end of this year and culminate more than four decades of SEC service, including the past 32 years as the Director of Regional Office Operations in the Enforcement Division. Mr. Clarkson has been the principal liaison between Division of Enforcement management in Washington and the SEC's 11 field offices, coordinating human resources, budget, management and administrative matters. He also has been one of the main SEC enforcement liaisons with state securities commissions, and has worked closely with enforcement directors and other senior enforcement staff to perform a number of other vital duties for the enforcement program. In addition, he has worked on issues involving the regional offices' examination programs. Mr. Clarkson even periodically served as an Acting Regional Director in several of the SEC's regional offices over the years - most recently in 2008 and 2009 at the New York Regional Office. "Jim Clarkson has dedicated his professional career to the SEC's mission of investor protection, and he has had an enormous impact on the agency during the past 40 years," said SEC Chairman Mary L. Schapiro. "Jim leaves behind a substantial legacy of accomplishments here in Washington and at our regional offices around the country. We owe him a debt of sincere gratitude for his wise counsel and outstanding leadership." Robert Khuzami, the Director of the Division of Enforcement, said, "We speak of the accomplishments of institutions, and that is as it should be, but in doing so we sometimes overlook that those accomplishments are nothing more than the collective efforts of many individuals. Jim Clarkson is someone whose efforts can never be overlooked. He has contributed tremendously to countless SEC accomplishments over his many years of outstanding public service. His experience, long-term perspective and willingness to provide counsel to all who seek his advice make him a kind of stitching that has held together the fabric of the SEC as successive generations pass through its doors. It has been a privilege to have had the opportunity to work with him." In announcing his plans to retire, Mr. Clarkson said, "I will always treasure my years with the SEC. There is no finer agency in government. I will be forever grateful to have had the opportunity of working with such an outstanding group of dedicated and talented individuals as those who have served as Chairmen, Commissioners and staff in pursuit of the Commission's important mission during my time at the SEC. I especially want to thank the many current and former Regional Directors and the members of their staff for their support and friendship. They are among the most significant reasons I have devoted my professional career to this agency." When he joined the agency in 1969, Mr. Clarkson first served as a staff attorney in the Enforcement Division. Then he worked in the Division of Corporation Finance's Office of Chief Counsel before becoming a legal counsel to Commissioners Hugh Owens and Irving Pollack. Mr. Clarkson returned to the Enforcement Division as an Assistant Director before his promotion to his current position. Over the past several years, Mr. Clarkson has been active in providing technical assistance and training on enforcement and market oversight issues to various international securities regulators - including those in Russia, China, Hong Kong, and India. He also has provided assistance to these countries regarding the development and management of regional office networks of national securities regulators. Mr. Clarkson received a Bachelor of Arts degree from Princeton University, a Masters of Business Administration from Columbia University, and his law degree from the New York University School of Law. During his career, Mr. Clarkson was awarded the SEC's Distinguished Service Award, which is the highest honor the Commission bestows on members of its staff. He also has received a Presidential Rank Award for Meritorious Service, the Chairman's Award for Excellence, and the SEC's EEO Award. (Press Rel. 2010-217) Joseph Brenner Named Chief Counsel in SEC Division of EnforcementThe Securities and Exchange Commission today announced that Joseph K. Brenner has been selected as Chief Counsel of the Division of Enforcement, a role in which he will oversee the process of providing legal and policy advice on potential enforcement actions before they are recommended to the Commission for approval. Mr. Brenner joins the SEC from Wilmer Cutler Pickering Hale and Dorr LLP, where he has been a partner since 1990. Mr. Brenner most recently served as Vice Chair of the firm's Securities Department and as a member of the Securities Litigation and Enforcement Practice Group. "Joe is a highly-accomplished attorney who will bring a deep expertise and a practical perspective to the many legal and policy issues facing the Enforcement Division," said Robert Khuzami, Director of the SEC's Division of Enforcement. "We could not be more pleased that he has chosen to join the Division, and we look forward to his counsel and help as the Division moves forward on its many initiatives to better realize its mission of investor protection." Mr. Brenner said, "I am greatly honored to join the Enforcement Division at this important time. I look forward to working with the dedicated professionals of the Enforcement staff to carry out the SEC's crucial mission of protecting investors and safeguarding the financial markets." Mr. Brenner is filling the Chief Counsel position previously held by Joan McKown, who left the agency in August after 24 years of service. He is expected to begin his new role sometime in the next several weeks. At WilmerHale, Mr. Brenner's focus was securities enforcement, internal corporate investigations, and related civil and criminal litigation. He has more than 20 years of experience in representing public corporations, financial institutions, professional service partnerships, investment managers, and individuals in investigations and enforcement proceedings by the SEC, FINRA, and PCAOB, and related federal criminal and civil litigation involving insider trading, accounting, financial reporting, and disclosures. In addition, Mr. Brenner has led and participated in many audit committee, special committee, and other internal corporate investigations. Prior to joining WilmerHale, Mr. Brenner was a law clerk for the U.S. Court of Appeals for the District of Columbia Circuit. Mr. Brenner received his JD cum laude from Georgetown University Law Center and his undergraduate degree from Cornell University. (Press Rel. 2010-218) SEC Announces $3.9 Million Distribution of Heartland Advisors, Inc. Fair FundThe Securities and Exchange Commission today announced the distribution of approximately $3.9 million to eligible shareholders of the Heartland Group, Inc. High-Yield Municipal Bond Fund and the Heartland Group, Inc. Short Duration High-Yield Municipal Fund (collectively, Funds) at the close of market on Oct. 13, 2000. The Fair Fund was created on Jan. 25, 2008 in an Order entered against Heartland Advisors, Inc., (Heartland Advisors), William J. Nasgovitz (Nasgovitz), Paul T. Beste (Beste), Thomas J. Conlin (Conlin), Greg D. Winston (Winston), Kevin D. Clark (Clark), Kenneth J. Della (Della), and Hugh F. Denison (Denison). The Order was entered by the Commission based on Heartland Advisors' mispricing certain bonds owned by two mutual funds that Heartland Advisors managed, and Heartland Advisors' failure to effectively communicate important facts concerning its efforts to evaluate bond issuers. The Commission has authorized distributing $3.9 million paid by Heartland Advisors, Nasgovitz, Beste, Conlin, Winston, Clark, and Della. The Fund Administrator responsible for this distribution is Rust Consulting, Inc. Questions regarding the distribution may be directed to Rust Consulting:
For more information see Exchange Act Release No. 57206, Exchange Act Release No. 61481, and Exchange Act Release No. 61823. Commission MeetingsAnnual Forum on Small Business Capital Formation - Thursday, Nov. 18, 2010 - 9:00 a.m.The forum will include a panel discussion focusing on selected provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act relating to securities regulation and small business and presentations by private organizations concerned with small business capital formation. The panel discussion and presentations will take place in the Auditorium of the Commission's headquarters at 100 F Street, NE, Washington, D.C. and will be open to the public with seating on a first-come, first-served basis. Doors will open at 8:30 a.m. Visitors will be subject to security checks. For further information, please contact Anthony Barone at 202-551-3261. ENFORCEMENT PROCEEDINGSIn the Matter of Jose O. Vianna, Jr.On November 9, the Commission issued an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934, Making Findings, and Imposing Remedial Sanctions (Order) against Jose O. Vianna, Jr. The Order finds that from October 2002 until April 2008, Vianna was a registered representative associated with Maxim Group, LLC, a broker-dealer registered with the Commission. The Order finds that on Sept. 27, 2010, a judgment was entered by consent against Vianna in the civil action entitled Securities and Exchange Commission v. Jose O. Vianna, Jr., et al., 10 Civ. 1842 (GBD), in the United States District Court for the Southern District of New York, permanently enjoining Vianna from future violations of Section 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder, and permanently enjoining him from future violations, or from aiding and abetting any violation, of Section 17(a) of the Exchange Act and Rule 17a-3 thereunder. The Commission's complaint in the civil injunctive action alleged that Vianna, while a registered representative associated with Maxim, participated in a fraudulent scheme to divert dozens of profitable stock trades and millions of dollars of trading profits from one of his customers to another customer. The complaint also alleged that as part of the scheme Vianna falsified Maxim's records. Based on the above, the Order bars Vianna from association with any broker or dealer. Vianna consented to the issuance of the Order without admitting or denying any of the findings except that he admitted the entry of the judgment. (Rel. 34-63289; File No. 3-14117) Delinquent Filers' Stock Registrations RevokedThe registrations of the registered securities of AOB Holdings, Inc., Applied Data Communications, Inc., Appoint Technologies, Inc., Aqua Care Systems, Inc., AquaSciences International, Inc., and Arix Corp. 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. 34-63294; File No. 3-14086) Commission Orders Hearings on Registration Suspension or Revocation Against Fourteen Companies for Failure to Make Required Periodic FilingsIn conjunction with today's trading suspension, the Commission also instituted two separate 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 fourteen companies for failure to make required periodic filings with the Commission: In the Matter of Edentify, Inc., et al., Administrative Proceeding File No. 3-14118
In the Matter of Enclaves Group, Inc., et al., Administrative Proceeding File No. 3-14119
In the Orders, the Division of Enforcement (Division) alleges that the Respondents are delinquent in their required periodic filings with the Commission. In these proceedings, 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 the proceeding issue an initial decision not later than 120 days from the date of service of the order instituting proceedings. (Rels. 34-63296; File No. 3-14118 and 34-63297; File No. 3-14119) Delinquent Filers' Stock Registrations RevokedThe registrations of the registered securities of Cape Systems Group, Inc., Caribbean Cigar Company, Casual Male Corp., Cell Power Technologies, Inc., CellMetrix, Inc. (f/k/a BCAM International, Inc.), Cellular Products, Inc. (n/k/a 872 Main Street Corp.), CepTor Corp., CGS Scientific Corp., and Ciprico, 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. 34-63298; File No. 3-14091) In the Matter of Robert J. SucaratoOn November 10, the Commission issued an Order Instituting Administrative Proceedings Pursuant to Section 203(f) of the Investment Advisers Act of 1940, Making Findings, and Imposing Remedial Sanctions (Order) against Robert J. Sucarato. The Order finds that Sucarato, who was associated with New York Financial Company (NYFC), an unregistered investment adviser, had a final judgment entered against him on October 28, 2010, in the civil action entitled Securities and Exchange Commission v. Robert J. Sucarato d/b/a New York Financial Company, Civil Action No. 09-cv-4953, in the United States District Court for the District of New Jersey. The Commission's complaint in the action alleged, among other things, that Sucarato raised at least $1,728,954 from several investors by offering investments in two hedge funds purportedly managed by Sucarato and NYFC. The complaint alleged that Sucarato made numerous false and misleading representations about the funds and NYFC, and that Sucarato either misappropriated the investors' funds for his own personal use or lost the funds by making risky investments in commodity options and securities. The complaint further alleged that, despite having never invested the funds or losing the funds that were invested, Sucarato provided false quarterly account statements to clients in which he showed extremely successful hedge funds and claimed huge returns on the investors' individual investments. Sucarato consented to the entry of the judgment without admitting or denying the allegations in the Commission's complaint. The final judgment entered against Sucarato permanently enjoins him from future violations of Sections 5(a), 5(c), and 17(a) 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, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 (Advisers Act), and orders him to pay disgorgement of $1,205,684, together with prejudgment interest of $140,451, for a total of $1,346,135, provided that the total of such disgorgement and prejudgment interest shall be offset, on a dollar for dollar basis, by any amounts paid by Defendant as restitution pursuant to an order of the Court in the civil case before the United States District Court for the District of New Jersey, Commodity Futures Trading Commission v. Robert J. Sucarato d/b/a New York Financial Company, Civil Action No. 08-cv-1932. In that civil action, on November 23, 2009, a final judgment was entered against Sucarato, permanently enjoining him from violating, among others, the antifraud provisions of the Commodity Exchange Act, and ordering him to pay restitution of $800,000 and a civil penalty of $1,200,000. Based on the above, the Order bars Robert J. Sucarato from association with any investment adviser. Robert J. Sucarato consented to the issuance of the Order without admitting or denying any of the findings in the Order. (Rel. IA-3104; File No. 3-14120) [SEC v. Robert J. Sucarato d/b/a New York Financial Company, Civil Action No. 09-CV-4953 (D.N.J.)] (LR-21734) In the Matter of Yung Bae KimOn November 10, the Commission issued an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 and Section 203(f) of the Investment Advisers Act of 1940, Making Findings, and Imposing Remedial Sanctions as to to Yung Bae Kim (Order). The Order finds that from 2001 until March 2005, Kim and another individual controlled K.L. Group, LLC, KL Florida, LLC, and KL Triangulum Management, LLC, three unregistered investment advisers that advised, controlled, and managed six hedge funds. The Order also finds that during this same period Kim also controlled Shoreland Trading, LLC, then a registered broker-dealer that conducted trading for the hedge funds Kim's investment advisers oversaw. The Order additionally finds that on August 15, 2005, the United States District Court for the Southern District of Florida entered an order of default judgment of permanent injunction and other relief against Kim, permanently enjoining him from future violations of Sections 17(a) of the Securities Act of 1933 [15 U.S.C. § 77q(a)]; Section 10(b) of the Securities Exchange Act of 1934 [15 U.S.C. § 78j(b)]; and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5]; and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 [15 U.S.C. §§ 80b-6(1) and 80b-6(2)] in the civil action entitled Securities and Exchange Commission v. K.L. Group, LLC, et al., Case No. 05-80186-CIV-Ryskamp/Vitunac. Based on the above, the Order bars Kim from association with any broker, dealer, or investment adviser. Kim consented to the issuance of the Order without admitting or denying any of the findings in the Order except for his default judgment, which he admitted. (Rels. 34-63302; IA-3105; File No. 3-14121) In the Matter of Won Sok LeeOn November 10, the Commission issued an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 and Section 203(f) of the Investment Advisers Act of 1940, Making Findings, and Imposing Remedial Sanctions as to Won Sok Lee (Order). The Order finds that from 2001 until March 2005, Lee and another individual controlled K.L. Group, LLC, KL Florida, LLC, and KL Triangulum Management, LLC, three unregistered investment advisers that advised, controlled, and managed six hedge funds. The Order also finds that during this same period Lee also controlled Shoreland Trading, LLC, then a registered broker-dealer that conducted trading for the hedge funds Lee's investment advisers oversaw. The Order additionally finds that on August 15, 2005, the United States District Court for the Southern District of Florida entered an order of default judgment of permanent injunction and other relief against Lee, permanently enjoining him from future violations of Sections 17(a) of the Securities Act of 1933 [15 U.S.C. § 77q(a)]; Section 10(b) of the Securities Exchange Act of 1934 [15 U.S.C. § 78j(b)]; and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5]; and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 [15 U.S.C. §§ 80b-6(1) and 80b-6(2)] in the civil action entitled Securities and Exchange Commission v. K.L. Group, LLC, et al., Case No. 05-80186-CIV-Ryskamp/Vitunac. Based on the above, the Order bars Lee from association with any broker, dealer, or investment adviser. Lee consented to the issuance of the Order without admitting or denying any of the findings in the Order except for his default judgment, which he admitted. (Rels. 34-63303; IA-3106; File No. 3-14122) SEC Obtains Officer and Director Bar Against Duane Martin, Former CEO of Universal Food & Beverage Co.On November 2, 2010, the District Court for the Northern District of Illinois entered a Final Judgment against Duane Martin in a civil action brought by the United States Securities & Exchange Commission (the Commission). Martin had been charged with a string of securities law violations committed during his tenure as Chief Executive Officer of the now-defunct Universal Food & Beverage Company, including repeated violations of the antifraud, registration, and books and records provisions as well as aiding and abetting Universal's violations of the reporting provisions of federal securities law. The judgment in SEC v. Duane Martin, et al., 09-cv-05259 (N.D. Ill.) permanently enjoins Martin from further violations of those provisions, permanently bars him from participating in any future penny stock offerings, and permanently bars him from serving as an officer or director of a public company. The Court's Order was entered based on Martin's Consent to Final Judgment in which he neither admitted nor denied the allegations in the Commission's Complaint. In its Complaint, the Commission alleged that Martin violated the registration provisions by improperly registering a Universal stock offering using Form S-8 - a registration method that is meant to cover offerings to bona fide employees and consultants of the company - and then surreptitiously directed the S-8 shares to stock promoters and Martin's personal creditors. The Complaint also alleges that Martin violated the antifraud provisions for multiple material misrepresentations and omissions to Universal's investors designed to hide the fact that Martin (a) improperly paid himself deferred salary, (b) had misappropriated company assets to pay himself and his creditors, (c) funneled S-8 shares to stock promoters and his creditors, and (d) took $234,430.66 in short-term loans from Universal in violation of Section 13(k) of the Securities Exchange Act of 1934 (the Exchange Act). To hide his self-dealing, Martin misled Universal's outside auditor and forged invoices to disguise payments he directed to his creditors. In so doing, Martin violated the Exchange Act's books and records provisions and aided and abetted Universal's violations of the Exchange Act's reporting provisions. On Mar. 16, 2010 - based largely on the same set of facts developed in the Commission's investigation - the United States Attorney's Office for the Northern District of Illinois (the USAO) brought a criminal wire fraud charge against Martin. Martin pled guilty and, on Jul. 13, 2010, was sentenced to 41 months in prison and ordered to pay $618,441 in restitution to Universal's creditors. The Commission recognizes the efforts of the USAO and the Chicago Office of the Federal Bureau of Investigation in resolving this case. [SEC v. Duane Martin and Gary Trump, Civil Action No. 09-cv-05259 (N.D.Ill.)] (LR-21733; AAE Rel. 3212) SELF-REGULATORY ORGANIZATIONSImmediate Effectiveness of Proposed Rule ChangesThe Commission issued notice of filing and immediate effectiveness of proposed rule change (SR-ISE-2010-107) filed by International Securities Exchange under Rule 19b-4 of the Securities Exchange Act of 1934 to list and trade options on leveraged exchange-traded notes and to broaden the definition of "futures-linked securities". Publication is expected in the Federal Register during the week of November 15. (Rel. 34-63271) The Commission issued notice of filing and immediate effectiveness of proposed rule change (SR-NYSEArca-2010-96) filed by NYSE Arca under Rule 19b-4 of the Securities Exchange Act of 1934 amending NYSE Arca Equities Rule 7.31(f) to modify the functionality of Tracking Orders. Publication is expected in the Federal Register during the week of November 15. (Rel. 34-63272) A proposed rule change filed by NYSE Arca amending the applicable sections of its schedules of fees and charges for exchange services for both its equities and options platforms to reflect fees charged for co-location services (SR-NYSEArca-2010-100) 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 November 15. (Rel. 34-63275) A proposed rule change filed by the International Securities Exchange (SR-ISE-2010-106) relating to fees and rebates for adding and removing liquidity 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 November 15. (Rel. 34-63283) A proposed rule change filed by EDGX Exchange to amend EDGX Rules 2.5 and 11.4 to permit qualification and registration of authorized traders of members pursuant to certain foreign examination modules equivalent to the Series 7 examination (SR-EDGX-2010-15) 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 November 15. (Rel. 34-63284) A proposed rule change filed by EDGA Exchange to amend EDGA Rules 2.5 and 11.4 to permit qualification and registration of authorized traders of members pursuant to certain foreign examination modules equivalent to the Series 7 examination (SR-EDGA-2010-16) 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 November 15. (Rel. 34-63286) Approval of Proposed Rule ChangeThe Commission approved a proposed rule change (SR-OCC-2010-05) under Section 19(b)(1) of the Securities Exchange Act by The Options Clearing Corporation. The rule change provides that cash-settled foreign currency options traded on national securities exchanges will be treated and cleared as securities options notwithstanding that they may have a nominal exercise price such as one cent. Publication is expected in the Federal Register during the week of November 15. (Rel. 34-63278) SECURITIES ACT REGISTRATIONSRECENT 8K FILINGS
http://www.sec.gov/news/digest/2010/dig111010.htm
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