Commission Charges Former Fannie Mae And Freddie Mac Executives With Securities Fraud: Companies Agree to Cooperate in SEC Actions
The Securities and Exchange Commission (Commission) today charged six former top executives of the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) with securities fraud, alleging they knew and approved of misleading statements claiming the companies had minimal holdings of higher-risk mortgage loans, including subprime loans.
Fannie Mae and Freddie Mac each entered into a Non-Prosecution Agreement with the Commission in which each company agreed to accept responsibility for its conduct and not dispute, contest, or contradict the contents of an agreed-upon Statement of Facts without admitting nor denying liability. Each also agreed to cooperate with the Commission's litigation against the former executives. In entering into these Agreements, the Commission considered the unique circumstances presented by the companies' current status, including the financial support provided to the companies by the U.S. Treasury, the role of the Federal Housing Finance Agency as conservator of each company, and the costs that may be imposed on U.S. taxpayers.
Three former Fannie Mae executives — former Chief Executive Officer Daniel H. Mudd, former Chief Risk Officer Enrico Dallavecchia, and former Executive Vice President of Fannie Mae's Single Family Mortgage business, Thomas A. Lund — were named in the SEC's complaint filed in U.S. District Court for the Southern District of New York.
The SEC also charged three former Freddie Mac executives — former Chairman of the Board and CEO Richard F. Syron, former Executive Vice President and Chief Business Officer Patricia L. Cook, and former Executive Vice President for the Single Family Guarantee business Donald J. Bisenius — in a separate complaint filed in the same court.
"Fannie Mae and Freddie Mac executives told the world that their subprime exposure was substantially smaller than it really was," said Robert Khuzami, Director of the SEC's Enforcement Division. "These material misstatements occurred during a time of acute investor interest in financial institutions' exposure to subprime loans, and misled the market about the amount of risk on the company's books. All individuals, regardless of their rank or position, will be held accountable for perpetuating half-truths or misrepresentations about matters materially important to the interest of our country's investors."
The SEC is seeking financial penalties, disgorgement of ill-gotten gains with interest, permanent injunctive relief and officer and director bars against Mudd, Dallavecchia, Lund, Syron, Cook, and Bisenius. Both lawsuits allege that the former executives caused the federal mortgage firms to materially misstate their holdings of subprime mortgage loans in periodic and other filings with the Commission, public statements, investor calls, and media interviews. The suit involving the Fannie Mae executives also includes similar allegations regarding Alt-A mortgage loans. The suit against the former Fannie Mae executives alleges they made misleading statements — or aided and abetted others — between December 2006 and August 2008. The former Freddie Mac executives are alleged to have made misleading statements — or aided and abetted others - between March 2007 and August 2008.
The SEC's complaint against the former Fannie Mae executives alleges that, when Fannie Mae began reporting its exposure to subprime loans in 2007, it broadly described the loans as those "made to borrowers with weaker credit histories," and then reported — with the knowledge, support, and approval of Mudd, Dallavecchia, and Lund — less than one-tenth of its loans that met that description. Fannie Mae reported that its 2006 year-end Single Family exposure to subprime loans was just 0.2 percent, or approximately $4.8 billion, of its Single Family loan portfolio. Investors were not told that in calculating the Company's reported exposure to subprime loans, Fannie Mae did not include loan products specifically targeted by Fannie Mae towards borrowers with weaker credit histories, including more than $43 billion of Expanded Approval, or "EA" loans.
Fannie Mae's executives also knew and approved of the decision to underreport Fannie Mae's Alt-A loan exposure, the SEC alleged. Fannie Mae disclosed that its March 31, 2007 exposure to Alt-A loans was 11 percent of its portfolio of Single Family loans. In reality, Fannie Mae's Alt-A exposure at that time was approximately 18 percent of its Single Family loan holdings.
The misleading disclosures were made as Fannie Mae's executives were seeking to increase the Company's market share through increased purchases of subprime and Alt-A loans, and gave false comfort to investors about the extent of Fannie Mae's exposure to high-risk loans, the SEC alleged.
In the complaint against the former Freddie Mac executives, the SEC alleged that they and Freddie Mac led investors to believe that the firm used a broad definition of subprime loans and was disclosing all of its Single-Family subprime loan exposure. Syron and Cook reinforced the misleading perception when they each publicly proclaimed that the Single Family business had "basically no subprime exposure." Unbeknown to investors, as of December 31, 2006, Freddie Mac's Single Family business was exposed to approximately $141 billion of loans internally referred to as "subprime" or "subprime like," accounting for 10 percent of the portfolio, and grew to approximately $244 billion, or 14 percent of the portfolio, as of June 30, 2008.
The SEC's complaint alleges that Mudd violated Section 10(b) of the Securities Exchange Act of 1934 (the "Exchange Act") and Rules 10b-5(b) and 13(a)14(a) thereunder, and Section 17(a)(2) of the Securities Act of 1933 (the "Securities Act"); and that Mudd aided and abetted Fannie Mae's violations of Sections 10(b) and 13(a) of the Exchange Act and Exchange Act Rules 10b-5(b), 12b-20, 13a-1, and 13a-13 thereunder. The SEC complaint also alleges that Dallavecchia violated Section 17(a)(2) of the Securities Act and aided and abetted Fannie Mae's violations of Sections 10(b) and 13(a) of the Exchange Act and Exchange Act Rules 10b-5(b), 12b-20, 13a-1, and 13a-13 thereunder. Finally, the SEC complaint alleges that Lund aided and abetted Fannie Mae's violations of Sections 10(b) and 13(a) of the Exchange Act and Exchange Act Rules 10b-5(b), 12b-20, 13a-1, and 13a-13 thereunder.
The SEC's complaint alleges that Syron and Cook violated Exchange Act Section 10(b) and Rule 10b-5(b) thereunder and Securities Act Section 17(a)(2); that Syron violated Exchange Act Rule 13a-14; and that Syron, Cook and Bisenius aided and abetted violations of Sections 10(b) and 13(a) of the Exchange Act and Rules 10b-5(b), 12b-20 and 13a-13 thereunder.
The SEC's investigation of Fannie Mae was conducted by Senior Attorneys Natasha S. Guinan, Christina M. Marshall, Liban Jama, Mona L. Benach, and Associate Chief Accountant, Peter Rosario, under the supervision of Assistant Director Charles E. Cain, and Associate Director Stephen L. Cohen. Sarah Levine and James Kidney will lead the SEC's litigation efforts.
The SEC's investigation of Freddie Mac was conducted by Senior Attorneys Giles T. Cohen and David S. Karp and Assistant Chief Accountant Avron Elbaum of the SEC's Division of Enforcement under the supervision of Assistant Director Charles E. Cain and Associate Director Stephen L. Cohen. Kevin O'Rourke and Suzanne Romajas will lead the SEC's litigation efforts. (Press Rel. 2011-267).
The Closed Meeting scheduled for Monday, December 19, 2011 at 2:00 p.m., has been changed to Tuesday, December 20, 2011 at 10:00 a.m. 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 Charges Daniel “Rudy” Ruettiger and 12 Others in Scheme to Pump Stock in Sports Drink Company
The Commission today charged Daniel Ruettiger, the former walk-on football player at Notre Dame who inspired the 1993 film “Rudy,” and 12 other participants in a scheme to deceive investors into buying stock in his sports drink company.
According to the SEC’s complaint filed in federal court in Las Vegas, Ruettiger founded Rudy Nutrition to compete with Gatorade in the sports drink market. Rudy Nutrition produced and sold modest amounts of a sports drink called “Rudy” with the tagline “Dream Big! Never Quit!” However, the company primarily served as a vehicle for a pump-and-dump scheme that occurred in 2008 and generated more than $11 million in illicit profits.
The SEC alleges that investors were provided false and misleading statements about the company in press releases, SEC filings, and promotional materials. For example, a promotional mailer to potential investors falsely claimed that in “a major southwest test, Rudy outsold Gatorade 2 to 1!” A promotional e-mail falsely boasted that in “several blind taste tests, Rudy outperformed Gatorade and Powerade by 2:1.” Meanwhile, the scheme’s promoters engaged in manipulative trading to artificially inflate the price of Rudy Nutrition stock while selling unregistered shares to investors. The SEC suspended trading and later revoked registration of the stock in late 2008. Rudy Nutrition is no longer in business.
According to the SEC’s complaint, Ruettiger was the principal founder and namesake of a company called Rudy Beverage Inc. that he and a Notre Dame friend ran out of South Bend until October 2007, when Rocky Brandonisio became the company’s president and day-to-day business manager. He moved the company’s operations to Las Vegas, where he and Ruettiger live. Ruettiger remained CEO. During this time, the company struggled financially with few customers, few assets, and no profits.
The SEC alleges that Ruettiger and Brandonisio brought in an experienced penny stock promoter named Stephen DeCesare to orchestrate a public distribution of company stock in late 2007. Ruettiger knew DeCesare from previous business dealings, and they were neighbors in Las Vegas. Ruettiger and Brandonisio gave DeCesare sufficient control to turn Rudy Beverage into a publicly traded company. DeCesare became the primary organizer of the resulting pump-and-dump scheme
According to the SEC’s complaint, DeCesare identified a shell corporation quoted on the Pink Sheets for use in what’s known as a reverse merger, which occurs when a private company acquires a public company (typically a shell company) in order to become publicly-traded. DeCesare tasked a business consultant named Kevin Quinn with executing the merger and working with the company’s transfer agent to issue purportedly unrestricted stock. On Feb. 11, 2008, they acquired the shell company in a reverse merger and changed its name to “Rudy Nutrition.” Ruettiger authorized his signature to be placed electronically on an SEC filing four days later, and Rudy Nutrition began to be quoted on the Pink Sheets on Feb. 21, 2008, under the ticker symbol RUNU. DeCesare and Quinn, who is a disbarred California lawyer, arranged for three billion RUNU shares to be issued to nominee entities, which sold almost one billion shares to unsuspecting investors in the public market during the scheme.
The SEC alleges that DeCesare then organized the efforts to pump RUNU stock by partnering with other penny stock promoters to inflate the price and volume artificially through fraudulent touting and manipulative trading. The scheme’s participants made a series of false or misleading statements about RUNU to the public in mailers sent to millions of U.S. investors, messages posted in Internet chat rooms dedicated to penny stocks, and videos placed on the Internet for public viewing. False and misleading statements about the company also were made in press releases and filings with the SEC. These disingenuous promotional efforts had the predictable effect of attracting buyers to RUNU stock. In less than a month, RUNU went from trading 720 shares to more than 3 million shares, and within two weeks the price of RUNU stock climbed from 25 cents to $1.05 per share. After March 12, 2008, RUNU stock began a roller coaster ride as the scheme’s participants sold millions of RUNU shares to the market amid their simultaneous efforts to pump the stock.
According to the SEC’s complaint, the scheme eventually ended when the SEC issued a trading suspension against RUNU on Sept. 12, 2008 for delinquent periodic filings. Only days before the trading suspension, arrangements were being made to issue another two billion shares that scheme participants planned to dump on the market at the end of September 2008. But they were unable to do so because of the SEC’s trading suspension. The SEC revoked the registration of Rudy Nutrition securities on Nov. 14, 2008.
Ruettiger and 10 of the scheme’s other participants have agreed to settle the SEC’s charges without admitting or denying the allegations. The settlements, which are subject to court approval, impose penny stock bars and officer-and-director bars as appropriate. Ruettiger agreed to pay $382,866 in settling the charges, and other participants consented to final judgments also ordering disgorgement, prejudgment interest, and financial penalties. (Press Rel. 2011-268).
SEC v. Securities Investor Protection Corporation
On December 12, 2011, the Securities and Exchange Commission filed an application with the federal district court in the District of Columbia to compel the Securities Investor Protection Corporation (SIPC) to file an application to begin a liquidation proceeding with regard to Stanford Group Company (SGC), a broker-dealer registered with the Commission and a SIPC-member brokerage firm.
In February 2009, the Commission brought a civil enforcement action against Robert Allen Stanford, SGC, and others, alleging that they operated a multi-billion dollar Ponzi scheme. As a result of that enforcement action, a federal district court in Texas ordered that SGC be placed into receivership.
On June 15, 2011, the Commission directed SIPC to take steps to initiate a liquidation proceeding with regard to SGC because there were customers in need of the protections of the Securities Investor Protection Act of 1970 (SIPA). Among other things, SIPA provides for coverage of up to $500,000 to customers of a defunct brokerage firm in the event that funds available at the firm are insufficient to satisfy claims covered by the statute. This coverage is provided from a fund maintained by SIPC.
Despite the Commission's directive, SIPC has failed to take steps to initiate a liquidation proceeding as to SGC. Accordingly, the Commission filed an application with the district court seeking an order compelling SIPC to do so. (LR- 22193).
All Know Holdings Ltd, Et al.
On December 15, 2011, the Commission announced that it filed new charges in its pending insider trading case against four Chinese citizens and a Chinese-based entity. On December 5, 2011, the SEC charged the defendants with insider trading after they reaped millions in profits by trading in advance of a publicly announced merger between London-based Pearson plc and Beijing-based Global Education and Technology Group, Ltd. The SEC’s amended complaint names new defendants Yonghui Zhang and Xuechu Yang along with the previously charged defendants Sha Chen, Song Li, Lili Wang, Zhi Yao, and All Know Holdings Ltd. The Court entered an emergency order freezing the assets of Yang and Zhang and continued the temporary restraining order freezing the assets of the previously charged defendants.
The SEC’s amended complaint alleges that the defendants purchased American Depository Shares (ADS) of Global Education in the two weeks leading up to a November 21 public announcement of a planned merger between the two education companies. Some of the defendants’ brokerage accounts were dormant until they bet heavily on Global Education shares, and some of the purchases made either equaled or exceeded the stated annual income of that trader. After the agreement was announced, they immediately began selling some of their Global Education shares. Their illicit gains totaled more than $2.8 million.
According to the SEC’s amended complaint, filed in the U.S. District Court in Chicago, Pearson and Global Education each announced before trading began on November 21 that Pearson agreed to acquire all of Global Education’s outstanding stock for $294 million ($11.006 per share traded in the U.S.). Global Education’s stock price increased 97 percent that day, from $5.37 to $10.60.
The SEC alleges that the defendants made their purchases of Global Education’s shares while in possession of material, non-public information about the merger. Yonghui Zhang, a Global Education employee and brother of David Zhang, CEO of Global Education, purchased Global Education shares the last trading day before the merger announcement. Yang engaged in similarly suspicious trading in Global Education stock, which trades on NASDAQ and was typically thin.
The SEC alleges that the defendants each violated Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. In addition to the asset freeze orders, the SEC seeks permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, and financial penalties against all of the defendants. The emergency court orders that the SEC obtained on December 5 and 15 on an ex parte basis freeze more than $2.8 million of defendants’ assets held in U.S. brokerage accounts and, among other things, grant expedited discovery and prohibit the defendants from destroying evidence. The investigation is continuing.
A hearing on the SEC’s motion for preliminary injunction has been set for January 3, 2011 at 9:30 a.m. in the U.S. District Court for the Northern District of Illinois, Courtroom 1719, located at 219 South Dearborn Street, Chicago, Illinois, 60604.[SEC V. ALL KNOW HOLDINGS LTD, ET AL., Case No. 11 CV 8605 (N.D. Ill, filed December 15, 2011) (LR- 22194)]
Jury Finds Former Prudential Securities Registered Representative Liable For Deceptive Mutual Fund Market Timing Practices
The Commission announced that on December 14, 2011, a federal jury returned a verdict in the SEC’s favor on securities fraud charges against Frederick J. O’Meally of Bay Shore, New York, a former registered representative of broker-dealer Prudential Securities Inc. alleged to have used deceptive practices to evade blocks on his trading by mutual fund companies. The jury found O’Meally liable for violations of Sections 17(a)(2) and/or (3) of the Securities Act of 1933 (the “Securities Act”). The verdict against O’Meally followed a five-week trial in New York City, NY before the Honorable Laura Taylor Swain, United States District Court Judge for the Southern District of New York.
The Commission filed its Complaint on August 28, 2006 against four registered representatives formerly employed by Prudential Securities, Inc. The Complaint alleged that, between 2001 and 2003, certain mutual fund companies detected market timing activity by the Defendants and attempted to block the Defendants and their hedge fund customers from further trading in their funds. The Complaint further alleged that the Defendants used fraudulent and deceptive trading practices to conceal their and their customers’ identities to evade these blocks. Cases against the three other defendants had been resolved previously by settlement.
The district court will hear further post-trial arguments in January 2012, and may determine the appropriate sanctions and remedies against O’Meally at a later date. In addition, the jury found that O’Meally had not violated Section 10(b) of the Exchange Act and Section 17(a)(1) of the Securities Act.
For further information about the Commission’s action in SEC v. O’Meally, et al., see Litigation Release No. 21882 (March 10, 2011) [settlement with Jason N. Ginder]; Litigation Release No. 20910 (February 25, 2009) [settlement with Michael L. Silver and Brian P. Corbett]; In the Matter of Michael L. Silver, Release No. 34-59639 (March 27, 2009); In the Matter of Brian P. Corbett, Release No. 34-59640 (March 27, 2009); Exchange Act Release No. 54371 (August 28, 2006) [settlement with Prudential Equity Group, LLC, formerly known as Prudential Securities, Inc.]; Litigation Release No. 19813 (August 26, 2006) [complaint against O’Meally, et al. filed].
[SEC v. Frederick J. O’Meally et al., Civil Action No. 06-CV-6483-LTS (S.D.N.Y.)] (LR-22196)
SEC Charges Broker For Assisting Investment Adviser’s Fraud
On December 15, 2011, the Commission filed a civil injunctive action in the U.S. District Court for the Northern District of Illinois against Stephen M. Folan, a former registered representative in the Chicago office of FTN Financial Securities Corp. (FTN), for assisting Sentinel Management Group, Inc. (Sentinel), a bankrupt former investment adviser, in its fraud against its advisory clients.
The SEC’s complaint alleges that over year-end 2006 and the first few days of 2007, Sentinel and FTN engaged in a five-day reverse repurchase transaction (Repo Transaction) involving approximately $35 million of collateralized debt obligations (CDOs). Folan acted as the primary advocate for the Repo Transaction within FTN and served as the conduit between Sentinel, his best customer, and FTN’s management. The complaint further alleges that recorded telephone calls show that although Folan had information indicating that Sentinel would use the Repo Transaction for an improper purpose, he did not share this information with his superiors at FTN.
According to the SEC complaint, Sentinel used the Repo Transaction to mislead its clients by temporarily reducing the outstanding bank loan balance in its year-end 2006 financial statements by approximately 10% without disclosing that the source of the reduction was an atypical, non-recurring event and by understating its liabilities by failing to record any liability associated with its obligation to repurchase the CDOs when the Repo Transaction was unwound.
Folan, without admitting or denying the SEC’s allegations, agreed to the entry of an order permanently enjoining him from aiding and abetting future violations of Section 206(2) of the Investment Advisers Act of 1940 and requiring him to pay a $50,000 civil penalty. The proposed settlement is subject to approval by the court. As part of the settlement, Folan also agreed to the entry of a Commission Order barring him from association with any broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or nationally recognized statistical rating organization, or from participating in any offering of a penny stock, with the right to reapply after three years.
In a related case, on November 17, 2011, FTN consented, without admitting or denying the findings, to the entry of a Commission Order finding that FTN was a cause of Sentinel’s violation of Section 204(a) of the Advisers Act and Rule 204-2(a)(6) promulgated thereunder. The Order required FTN to cease and desist from committing or causing any violations and any future violations of these provisions and to pay disgorgement of $1,495,878.00 and prejudgment interest of $377,758.73. (Rel. IA-3316; File No. 3-14632) .
[Securities and Exchange Commission v. Stephen M. Folan, United States District Court for the Northern District of Illinois, Civil Action No. 1:11-cv-8905 (N.D. Ill. Dec. 15, 2011)] (LR-22197).
In the Matter of Stuart W. Fuhlendorf
The Commission announced the issuance of 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 Stuart W. Fuhlendorf. The Order finds that Fuhlendorf served as Chief Financial Officer of Isilon Systems, Inc. (Isilon) from May 2004 to October 2007.
The Order further finds that the Commission filed a civil injunctive action against Fuhlendorf, captioned SEC v. Fuhlendorf, Civil Action Number 2:09-CV-01292-MJP, in the United States District Court for the Western District of Washington. The Commission alleged, among other things, that in 2006 and 2007, Fuhlendorf caused Isilon to improperly recognize revenue for multiple sales, including transactions with side agreements between Isilon and its customers precluding revenue recognition under GAAP. The complaint further alleged that Fuhlendorf misled Isilon’s audit committee and auditors. Isilon ultimately restated $4.8 million in improper revenue for these transactions.
The Order further finds that, on November 23, 2011, the District Court entered an order permanently enjoining Fuhlendorf from future violations of Sections 17(a)(2) and (3) of the Securities Act of 1933, Sections 10(b) and 13(b)(5) of the Securities Exchange Act of 1934 and Rules 10b-5, 13b2-1, 13b2-2, and 13a-14 thereunder.
Based on the above, the Order suspends Fuhlendorf from appearing or practicing before the Commission as an accountant with the right to apply for reinstatement after three years. Fuhlendorf consented to the issuance of the Order without admitting or denying the findings in the Order, except that he admitted the entry of the injunction. (Rel. 34-65996; File No. 3-14671)
In the Matter of Richard Dalton
The Commission announced the issuance of an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities and Exchange Act of 1934 and Notice of Hearing against Richard Dalton.
The Order alleges that on December 1, 2011, the United States District Court for the District of Colorado permanently enjoined Dalton from violations of Sections 5 and 17(a) of the Securities Act of 1933, and Sections 10(b) and 15(a) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder in Securities and Exchange Commission v. Richard Dalton et al., Civil Action Number 1:10-cv-2794-REB. The Order alleges that on December 8, 2011, the Court entered a default judgment against Dalton that also permanently enjoined him from violations of Sections 5 and 17(a) of the Securities Act of 1933, and Sections 10(b) and 15(a) of the Securities and Exchange Act of 1934 and Rule 10b-5. The Order further alleges that the District Court held on December 1, 2011 that Dalton violated federal securities law, sold securities in unregistered transactions, acted as an unregistered broker or dealer, and engaged in a variety of conduct which operated as a fraud and deceit on investors. The Commission’s complaint alleged that from about March 2007 through June 2010, Dalton offered and sold securities in the form of investment contracts known as the “Trading Program” and the “Diamond Program.” The complaint alleged that Dalton used a corporation called Universal Consulting Resources, LLC (UCR) to raise approximately $17 million from 130 investors and that the investment contracts were a Ponzi scheme.
A hearing will be scheduled before an Administrative Law Judge to determine whether the allegations in the Order are true, to provide Dalton an opportunity to respond to these allegations, and to determine what, if any, remedial action is appropriate in the public interest. The Order directed the Administrative Law Judge to issue an initial decision within 210 days from the date of service of the Order. (Rel. 34- 65997; File No. 3-14672)
In the Matter of Capital Financial Services, Inc. and Brian W. Boppre
The Commission announced the issuance of an Order Making Findings, and Imposing Remedial Sanctions and a Cease-and-Desist Order Pursuant to Sections 15(b) and 21C of the Securities Exchange Act of 1934 and Section 9(b) of the Investment Company Act of 1940 as to Brian W. Boppre (Order) against Brain W. Boppre (Boppre). The Order finds that Boppre, a registered representative with Capital Financial Services, Inc. (Capital Financial), a broker-dealer registered with the Commission, failed to perform reasonable due diligence on numerous private placement offerings sold by Capital Financial that turned out to be a classic Ponzi scheme and offering fraud. As a result of the conduct, Boppre willfully violated Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, which prohibit fraudulent conduct in the offer and sale of securities and in connection with the purchase or sale of securities.
Based on the above, Boppre is ordered to cease and desist from committing or causing any violations and any future violations of Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder and bars him from association with any broker, dealer, investment adviser, municipal securities dealer, or transfer agent, and prohibits him from serving or acting as an employee, officer, director, member of an advisory board, investment adviser or depositor of, or principal underwriter for, a registered investment company or affiliated person of such investment adviser, depositor, or principal underwriter, and bars him from participating in any offering of a penny stock, with the right to apply for reentry after two (2) years. Boppre is also ordered to pay a civil money penalty of $25,000.
Boppre consented to the issuance of the Order without admitting or denying any of the findings in the Order. (Rel. 34-65998; File No. 3-14324)
In the Matter of Capital Financial Services, Inc. And Brian W. Boppre
The Commission announced the issuance of an Order Making Findings, and Imposing Remedial Sanctions and a Cease-and-Desist Order Pursuant to Sections 15(b) and 21C of the Securities Exchange Act of 1934 as to Capital Financial Services, Inc. (Order). The Order finds that Capital Financial, a broker-dealer registered with the Commission, failed to perform reasonable due diligence on numerous private placement offerings sold by Capital Financial that turned out to be a classic Ponzi scheme and offering fraud. The Order finds that Capital Financial willfully violated Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, which prohibit fraudulent conduct in the offer and sale of securities and in connection with the purchase or sale of securities.
Based on the above, the Order censures Capital Financial and orders it to cease and desist from committing or causing any violations and any future violations of Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. The Order also requires Capital Financial to retain the services of a qualified Independent Consultant to: (i) conduct a comprehensive review of Capital Financial’s due diligence policies, practices, and procedures; (ii) determine the adequacy of such due diligence policies and practices; and (iii) prepare a written report, reviewing the adequacy of Capital Financial’s due diligence policies, practices, and procedures and make recommendations regarding how Capital Financial should modify or supplement its due diligence policies and practices.
Capital Financial consented to the issuance of the Order without admitting or denying any of the findings in the Order. (Rel. 34-66000; File No. 3-14324)
Commission Resolves OCC Holdings Offering Fraud Case
The Commission announced that on November 30, 2011, the Honorable J. Paul Oetken of the United States District Court for the Southern District of New York entered consent judgments against the remaining defendants, Ahmed Awan and Yakov Koppel, in a case arising out of alleged fraudulent offerings of securities of OCC Holdings, Ltd, a/k/a OnCallContractors.com (OCC Holdings) and several other issuers. Without admitting or denying the allegations of the Commission’s complaint, Awan and Koppel, both of Brooklyn, New York, consented to the entry of judgment that permanently enjoins Awan and Koppel from future violations of Section 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The judgment further orders that Awan pay $655.41 in disgorgement plus prejudgment interest and a $10,000 civil penalty and that Koppel pay $850.53 in disgorgement plus prejudgment interest and a $10,000 civil penalty, and bars Koppel from participating in the offering of any penny stock. As part of the settlements, Awan and Koppel also consented to the issuance of administrative orders barring each of them from the securities industry.
The action was filed on February 11, 2004. In March and April, 2004, the Commission obtained emergency relief, including temporary restraining orders, orders freezing the assets of almost all of the defendants and relief defendants, and expedited discovery.
On December 3, 2008, following the granting of the Commission’s motion for summary judgment, final judgments were entered against Tanwir and Labineri in which they were permanently enjoined from future violations of Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, barred from participating in the offering of any penny stock and ordered, respectively, to pay $4,660,641.87 in disgorgement plus prejudgment interest and $3,432,739 in civil penalty (Tanwir) and $2,751,710.69 in disgorgement plus prejudgment interest and $2,026,739 in civil penalty (Labineri). On February 20, 2009, the Commission obtained default judgments against defendants OCC Holdings, MB Holdings, and Equity Services Associates and relief defendants, Off World Strategic Holdings and MB Holdings USA Division A, Inc., in which the defendants were permanently enjoined from future violations of Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder and MB Holdings and Equity Services Associates were permanently barred from participating in the offering of any penny stock. In addition, OCC Holdings was ordered to pay $1,716,270.94 in disgorgement plus prejudgment interest and $1,252,652 in civil penalty, MB Holdings was ordered to pay $1,926,374.56 in disgorgement plus prejudgment interest and $1,406,000 in civil penalty, and Equity Services Associates was ordered to pay $1,060,584.26 in disgorgement plus prejudgment interest and $774,087 in civil penalty. Furthermore, relief defendants, Off World Strategic Holdings and MB Holdings USA Division A were respectively ordered to pay $592,958.91 and $137,010.99 in disgorgement plus prejudgment interest.
On November 22, 2011, the Commission voluntarily dismissed all claims against defendant Favata. [SEC v. OCC Holdings, Ltd., et al., 04-CV-1122 (SDNY) (JPO)] (LR-22200) (See also Rel. 34-65961; Rel. 34-65962)
Order Approving Proposed Rule Changes
The Commission granted approval of proposed rule changes, as modified by Amendments No. 1, submitted by EDGA Exchange, Inc. and EDGX Exchange, Inc. (SR-EDGA-2011-29 and SR-EDGX-2011-28) pursuant to Section 19(b)(1) and Rule 19b-4 under the Securities Exchange Act of 1934 relating to amendments to EDGA and EDGX rules regarding the registration and obligations of market makers. Publication is expected in the Federal Register during the week of December 19th. (Rel. 34-65964)
The Commission issued an order approving a proposed rule change submitted by The NASDAQ Stock Market LLC (SR-NASDAQ-2011-122) pursuant to Rule 19b-4 under the Securities Exchange Act of 1934 to describe complimentary services that are offered to certain new listings on NASDAQ’s Global and Global Select Markets. Publication is expected in the Federal Register during the week of December 19th. (Rel. 34-65963)
A proposed rule change filed by Chicago Mercantile Exchange, Inc. (CME) to revise rules relating to its cleared only OTC FX Swap Offering (File No. SR-CME-2011-17) has been approved on an accelerated basis pursuant to Section 19(b)(2) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of December 19th. (Rel. 34-65959)
Immediate Effectiveness of Proposed Rule Changes
A proposed rule change submitted by NYSE Arca, Inc. adopting the text of Financial Industry Regulatory Authority Rule 5210, which prohibits the publication of manipulative or deceptive quotations or transactions, as NYSE Arca Equities Rule 5210 (SR-NYSEARCA-2011-90) 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 December 19th. (Rel. 34-65955)
A proposed rule change filed by the International Securities Exchange, LLC (SR-ISE-2011-81) relating to fees for certain complex orders executed on the Exchange 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 December 19th. (Rel. 34-65958)
A proposed rule change filed by the New York Stock Exchange LLC adopting the text of Financial Industry Regulatory Authority Rule 5210, which prohibits the publication of manipulative or deceptive quotations or transactions, as NYSE Rule 5210 (SR-NYSE-2011-61) has become effective under Section 19(b)(3)(A) of the Exchange Act. Publication is expected in the Federal Register during the week of December 19th. (Rel. 34-65954)
A proposed rule change filed by the Chicago Board Options Exchange, Incorporated to expand the Weeklys Program (SR-CBOE-2011-125) 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 December 19th. (Rel. 34-65972)
The following registration statements have been filed with the SEC under the Securities Act of 1933. The reported information appears as follows: Form, Name, Address and Phone Number (if available) of the issuer of the security; Title and the number and/or face amount of the securities being offered; Name of the managing underwriter or depositor (if applicable); File number and date filed; Assigned Branch; and a designation if the statement is a New Issue.
Registration statements may be viewed in person in the Commission's Public Reference Branch at 100 F Street, N.E., Washington, D.C. To obtain paper copies, please refer to information on the Commission's Web site at http://www.sec.gov/answers/publicdocs.htm. In most cases, you can view and download this information by using the search function located at http://www.sec.gov/edgar/searchedgar/companysearch.html.
N-2 BlackRock Alternatives Allocation Portfolio LLC, 55 EAST 52ND STREET, NEW YORK, NY, 10055, (800) 882-0052 - 0 ($1,000,000.00) Equity, (File 333-178499 - Dec. 15) (BR. 17) N-2 BlackRock Alternatives Allocation FB Portfolio LLC, 55 EAST 52ND STREET, NEW YORK, NY, 10055, (800) 882-0052 - 0 ($1,000,000.00) Equity, (File 333-178500 - Dec. 15) (BR. 17) N-2 BlackRock Alternatives Allocation TEI Portfolio LLC, 55 EAST 52ND STREET, NEW YORK, NY, 10055, (800) 882-0052 - 0 ($1,000,000.00) Equity, (File 333-178501 - Dec. 15) (BR. 17) N-2 BlackRock Alternatives Allocation FB TEI Portfolio LLC, 55 EAST 52ND STREET, NEW YORK, NY, 10055, (800) 882-0052 - 0 ($1,000,000.00) Equity, (File 333-178502 - Dec. 15) (BR. 17) S-3ASR COVANTA HOLDING CORP, 445 SOUTH STREET, MORRISTOWN, NJ, 07960, 862-345-5000 - 0 ($0.00) Unallocated (Universal) Shelf, (File 333-178503 - Dec. 15) (BR. 02C) S-3ASR NEWMONT MINING CORP /DE/, 6363 SOUTH FIDDLERS GREEN CIRCLE, GREENWOOD VILLAGE, CO, 80111, 303-863-7414 - 4,915,685 ($319,519,525.00) Equity, (File 333-178504 - Dec. 15) (BR. 09B) S-3 RigNet, Inc., 1880 S. DAIRY ASHFORD, SUITE 300, HOUSTON, TX, 77077, 281-674-0100 - 8,037,713 ($126,674,356.88) Equity, 8,037,713 ($150,000,000.00) Unallocated (Universal) Shelf, (File 333-178506 - Dec. 15) (BR. 11A) S-3ASR TRAVELERS COMPANIES, INC., 385 WASHINGTON ST, SAINT PAUL, MN, 55102, 6513107911 - 0 ($0.00) Unallocated (Universal) Shelf, (File 333-178507 - Dec. 15) (BR. 01A) S-8 Rotoblock CORP, SUITE 205, 1715 COOK STREET, VANCOUVER, A1, V5Y 3J6, 604 872 1234 - 10,000,000 ($2,500,000.00) Equity, (File 333-178508 - Dec. 15) (BR. 10C) S-3 PATRICK INDUSTRIES INC, 107 WEST FRANKLIN STREET PO BOX 638, ELKHART, IN, 46515, 574-206-7515 - 135,000 ($456,300.00) Equity, (File 333-178509 - Dec. 15) (BR. 06C) S-8 PRINCIPAL FINANCIAL GROUP INC, 711 HIGH STREET, DES MOINES, IA, 50392-0300, 5152475111 - 10,000,000 ($233,400,000.00) Equity, (File 333-178510 - Dec. 15) (BR. 01B) F-9 ROGERS COMMUNICATIONS INC, 333 BLOOR STREET EAST, 10TH FLOOR, TORONTO, ONTARIO, A6, M4W 1G9, 4160353532 - 0 ($4,000,000,000.00) Debt, (File 333-178511 - Dec. 15) (BR. 11A) S-8 EATON VANCE CORP, TWO INTERNATIONAL PLACE, BOSTON, MA, 02110, 6174828260 - 4,300,000 ($98,126,000.00) Equity, (File 333-178512 - Dec. 15) (BR. 06C) S-1 Detectek Inc, 13224 W 107TH COURT, LENEXA, KS, 66210, 913-396-1911 - 6,000 ($22.80) Equity, (File 333-178513 - Dec. 15) (BR. ) N-2 Horizon Technology Finance Corp, 312 FARMINGTON AVENUE, FARMINGTON, CT, 06032, 860-676-8654 - 0 ($271,162,704.00) Other, (File 333-178516 - Dec. 15) (BR. 18) S-1 RealEstate Pathways, Inc., 2114 WEST APACHE TRAIL, STE 1150, APACHE JUNCTION, AZ, 85120, 480-382-2212 - 3,000,000 ($120,000.00) Equity, (File 333-178517 - Dec. 15) (BR. ) S-4 AbitibiBowater Inc., 1155 METCALF STREET, SUITE 800, MONTREAL, A8, H3B 5H2, 514-875-2160 - 0 ($59,255,666.00) Equity, (File 333-178518 - Dec. 15) (BR. 04B) S-3ASR ENDURANCE SPECIALTY HOLDINGS LTD, 4 PAR LA VILLE ROAD, HAMILTON HM 08 BERMUDA, D0, 00000, 441-278-0400 - 0 ($0.00) Unallocated (Universal) Shelf, (File 333-178519 - Dec. 15) (BR. 01B) S-8 SANTARUS INC, 3721 VALLEY CENTRE DRIVE, STE 400, SAN DIEGO, CA, 92130, 8583145700 - 0 ($9,180,000.00) Equity, (File 333-178520 - Dec. 15) (BR. 01A) S-3ASR AMERICAN ELECTRIC POWER CO INC, 1 RIVERSIDE PLAZA, COLUMBUS, OH, 43215, 614-716-1000 - 0 ($0.00) Debt, 0 ($0.00) Equity, (File 333-178522 - Dec. 15) (BR. 02B) S-4 HUNTINGTON INGALLS INDUSTRIES, INC., 4101 WASHINGTON AVENUE, 909-7, 7J2, NEWPORT NEWS, VA, 23607, (757) 380-2000 - 0 ($1,200,000,000.00) Other, (File 333-178523 - Dec. 15) (BR. 05B) S-4 Acadia Healthcare Company, Inc., 725 COOL SPRINGS BOULEVARD, SUITE 600, FRANKLIN, TN, 37067, 615-732-6259 - 0 ($150,000,000.00) Other, (File 333-178524 - Dec. 15) (BR. 01A) S-3ASR SCHWAB CHARLES CORP, 211 MAIN STREET, SAN FRANCISCO, CA, 94105, 415-667-7000 - 0 ($0.00) Unallocated (Universal) Shelf, (File 333-178525 - Dec. 15) (BR. 12A) S-8 MITEK SYSTEMS INC, 8911 BALBOA AVE., SUITE B, SAN DIEGO, CA, 92123, 858-503-7810 - 0 ($424,000.00) Equity, (File 333-178527 - Dec. 15) (BR. 03A) S-4 ENERGIZER HOLDINGS INC, 533 MARYVILLE UNIVERSITY DRIVE, ST LOUIS, MO, 63141, 3149852161 - 0 ($600,000,000.00) Non-Convertible Debt, (File 333-178528 - Dec. 15) (BR. 10A) S-8 ZYNGA INC, 699 EIGHTH STREET, SAN FRANCISCO, CA, 94103, 800-762-2530 - 0 ($1,651,838,480.49) Equity, (File 333-178529 - Dec. 15) (BR. 03A) S-4 SunCoke Energy, Inc., 11400 PARKSIDE DRIVE, KNOXVILLE, TN, 37934, 865.288.5200 - 0 ($400,000,000.00) Non-Convertible Debt, (File 333-178530 - Dec. 15) (BR. 06A)
Form 8-K is used by companies to file current reports on the following events:
8-K reports may be viewed in person in the Commission's Public Reference Branch at 100 F Street, N.E., Washington, D.C. To obtain paper copies, please refer to information on the Commission's Web site at http://www.sec.gov/answers/publicdocs.htm. In most cases, you can view and download this information by using the search function located at http://www.sec.gov/edgar/searchedgar/companysearch.html.
STATE NAME OF ISSUER CODE 8K ITEM NO. DATE COMMENT 99 CENTS ONLY STORES CA 8.01,9.01 12/15/11 Accenture plc L2 2.02,9.01 12/15/11 ACCENTURE SCA 2.02,9.01 12/15/11 ACCO BRANDS CORP DE 8.01,9.01 12/15/11 ACORN ENERGY, INC. DE 5.02 12/12/11 ADAMS GOLF INC DE 1.01,7.01,9.01 12/15/11 ADDVANTAGE TECHNOLOGIES GROUP INC OK 2.02,7.01,9.01 12/15/11 ADOBE SYSTEMS INC DE 2.02,5.02,9.01 12/12/11 ADVENT SOFTWARE INC /DE/ DE 5.02 12/14/11 AFFYMAX INC DE 8.01,9.01 12/15/11 AGL RESOURCES INC GA 1.01,2.01,2.03,3.03, 4.01,5.02, 5.03,8.01, 9.01 12/09/11 Aircastle LTD D0 1.01,2.03,3.03,9.01 12/14/11 ALARMING DEVICES, INC. NV 4.02 10/31/11 ALLETE INC MN 3.02 12/15/11 ALLIANCE DATA SYSTEMS CORP DE 7.01,9.01 12/15/11 Alpha Natural Resources, Inc. DE 8.01 12/09/11 ALTAIR NANOTECHNOLOGIES INC Z4 5.02 12/09/11 Alto Group Holdings Inc. NV 1.01,3.02 12/14/11 ALTRIA GROUP, INC. VA 5.02 12/14/11 AMERICA FIRST TAX EXEMPT INVESTORS LP DE 8.01 12/15/11 AMERICAN DENTAL PARTNERS INC DE 8.01,9.01 12/15/11 AMERICAN EXPRESS CO NY 7.01 12/15/11 American Realty Capital Trust III, In MD 1.01,2.01,9.01 12/09/11 AMERITYRE CORP NV 5.07,7.01 12/14/11 Amtrust Financial Services, Inc. DE 1.01,8.01,9.01 12/12/11 ANWORTH MORTGAGE ASSET CORP MD 8.01,9.01 12/15/11 APARTMENT INVESTMENT & MANAGEMENT CO MD 1.01,8.01,9.01 12/13/11 Apartment Trust of America, Inc. 7.01,9.01 12/14/11 APOGEE ENTERPRISES, INC. MN 2.02,9.01 12/14/11 APPLIED ENERGETICS, INC. DE 3.01,9.01 12/12/11 Aquilex Holdings LLC DE 8.01,9.01 12/15/11 ARAMARK CORP DE 8.01,9.01 12/15/11 ARGAN INC DE 2.02,9.01 12/13/11 ARIAD PHARMACEUTICALS INC DE 1.01,8.01,9.01 12/15/11 ARK RESTAURANTS CORP NY 2.03,8.01,9.01 12/09/11 ASHFORD HOSPITALITY TRUST INC MD 7.01,9.01 12/15/11 ASIAINFO-LINKAGE, INC DE 5.02,9.01 12/14/11 ATHENAHEALTH INC DE 7.01,9.01 12/15/11 AUTOMATIC DATA PROCESSING INC DE 5.02 12/14/11 AVALON HOLDINGS CORP OH 8.01 12/14/11 BALCHEM CORP MD 5.07,9.01 06/16/11 AMEND BALL CORP IN 8.01 12/14/11 BANK OF SOUTH CAROLINA CORP SC 8.01,9.01 12/15/11 BEHRINGER HARVARD MULTIFAMILY REIT I 7.01,9.01 12/15/11 Behringer Harvard Opportunity REIT II MD 9.01 09/29/11 AMEND BOEING CO DE 5.02 10/31/11 AMEND Boomerang Systems, Inc. DE 1.01,2.03,3.02,9.01 12/09/11 BOVIE MEDICAL CORP DE 1.02 12/09/11 BRIDGE BANCORP INC NY 8.01,9.01 12/15/11 CABELAS INC DE 7.01,9.01 12/15/11 CABLEVISION SYSTEMS CORP /NY DE 5.02 12/15/11 CADIZ INC DE 8.01,9.01 12/15/11 CAMBRIDGE PROJECTS INC. NV 3.02 12/05/11 CAPITAL ONE FINANCIAL CORP DE 7.01,9.01 12/14/11 CARDINAL BANKSHARES CORP VA 8.01,9.01 12/14/11 CardioNet, Inc. CA 8.01,9.01 12/09/11 CASEYS GENERAL STORES INC IA 7.01 12/15/11 CATERPILLAR FINANCIAL SERVICES CORP DE 8.01,9.01 12/14/11 CB RICHARD ELLIS REALTY TRUST MD 8.01 12/13/11 CFCRE Commercial Mortgage Trust 2011- DE 8.01,9.01 12/15/11 CFCRE Commercial Mortgage Trust 2011- DE 8.01,9.01 12/15/11 CHAMPION INDUSTRIES INC WV 2.04 12/14/11 CHASE CREDIT CARD MASTER TRUST NY 8.01,9.01 12/15/11 Chelsea Therapeutics International, L DE 8.01,9.01 12/15/11 CHINA NORTH EAST PETROLEUM HOLDINGS L NV 1.01,8.01,9.01 12/13/11 CHINA RECYCLING ENERGY CORP 1.01,9.01 12/09/11 China XD Plastics Co Ltd NV 5.07 10/14/11 CITIBANK OMNI-S MASTER TRUST 8.01 12/15/11 CITY HOLDING CO WV 8.01,9.01 12/15/11 CITY NATIONAL CORP DE 5.03,9.01 12/15/11 CNL LIFESTYLE PROPERTIES INC MD 2.01,9.01 10/12/11 AMEND COCA-COLA ENTERPRISES, INC. DE 8.01 12/15/11 CODORUS VALLEY BANCORP INC PA 5.02 12/13/11 COMPUTER PROGRAMS & SYSTEMS INC DE 1.02,2.01,9.01 12/13/11 CONSOLIDATED WATER CO LTD E6 8.01 12/11/11 Constellation Energy Partners LLC DE 7.01,8.01,9.01 12/13/11 COOPER COMPANIES INC DE 8.01,9.01 12/15/11 CORCEPT THERAPEUTICS INC DE 8.01,9.01 12/15/11 Covidien plc 2.02,7.01,8.01,9.01 12/15/11 CRATER MOUNTAIN RESOURCES, INC. NV 2.01 12/13/11 CTC Media, Inc. 5.02,9.01 12/15/11 CTI INDUSTRIES CORP DE 1.01 12/14/11 DATARAM CORP NJ 1.01,1.02,2.03,3.01, 9.01 12/14/11 DATARAM CORP NJ 2.02,9.01 12/15/11 DENNYS CORP DE 8.01 12/14/11 DEVRY INC DE 1.01,5.02,7.01,9.01 12/14/11 Diamond Foods Inc DE 8.01 12/14/11 Discover Financial Services DE 2.02,9.01 12/15/11 DOLLAR THRIFTY AUTOMOTIVE GROUP INC DE 5.02,9.01 12/09/11 Domtar CORP DE 8.01,9.01 12/15/11 DUKE REALTY CORP IN 2.01,7.01,9.01 12/09/11 DUKE REALTY LIMITED PARTNERSHIP/ IN 2.01,7.01,9.01 12/09/11 DynaVox Inc. 1.01 12/14/11 E MED FUTURE INC NV 1.03,3.03 12/13/11 ECOLAB INC DE 8.01 12/14/11 ECOLOGY COATINGS, INC. NV 1.01 12/15/11 EDIETS COM INC DE 5.02 11/29/11 AMEND EDUCATION MANAGEMENT CORPORATION 8.01,9.01 12/15/11 ELECTRONIC ARTS INC. DE 8.01,9.01 12/15/11 ENDO PHARMACEUTICALS HOLDINGS INC DE 5.03,9.01 12/09/11 ENERGIZER HOLDINGS INC MO 5.02,7.01,8.01,9.01 12/09/11 ENERGIZER HOLDINGS INC MO 8.01 12/15/11 Energizer Resources, Inc. MN 1.01,3.02,9.01 12/14/11 Entergy Louisiana, LLC TX 2.03,9.01 12/15/11 EXELON CORP PA 8.01,9.01 12/15/11 EXELON CORP PA 8.01,9.01 12/15/11 Fabrinet E9 5.07 12/12/11 Federal Home Loan Bank of Atlanta X1 2.03 12/15/11 Federal Home Loan Bank of Boston X1 2.03 12/13/11 Federal Home Loan Bank of Cincinnati X1 2.03,9.01 12/12/11 Federal Home Loan Bank of Dallas 2.03,9.01 12/09/11 Federal Home Loan Bank of Des Moines X1 5.02 12/15/11 Federal Home Loan Bank of Des Moines X1 2.03,9.01 12/13/11 Federal Home Loan Bank of New York X1 2.03,9.01 12/12/11 Federal Home Loan Bank of New York X1 5.02,9.01 12/15/11 Federal Home Loan Bank of New York X1 5.02 11/17/11 AMEND Federal Home Loan Bank of Pittsburgh PA 2.03,9.01 12/12/11 Federal Home Loan Bank of San Francis X1 2.03 12/12/11 Federal Home Loan Bank of Seattle 5.02,7.01,9.01 12/15/11 Federal Home Loan Bank of Topeka 2.03,9.01 12/12/11 Federal Home Loan Bank of Topeka 7.01,9.01 12/15/11 FEDEX CORP DE 2.02,9.01 12/15/11 First Bancorp, Inc /ME/ ME 8.01 12/15/11 FIRST BUSINESS FINANCIAL SERVICES, IN WI 7.01,9.01 12/15/11 FIRST CASH FINANCIAL SERVICES INC DE 8.01,9.01 12/15/11 FIRST INDUSTRIAL LP DE 1.01,2.03,7.01,9.01 12/14/11 FIRST INDUSTRIAL REALTY TRUST INC MD 1.01,2.03,7.01,9.01 12/14/11 FLOWSERVE CORP NY 8.01,9.01 12/15/11 FRANKLIN ELECTRIC CO INC IN 1.01,2.03,9.01 12/14/11 FRANKLIN ELECTRIC CO INC IN 2.03,9.01 12/14/11 FRANKLIN STREET PROPERTIES CORP /MA/ 2.05,5.02,9.01 12/15/11 FSP 303 East Wacker Drive Corp. 5.02,9.01 12/15/11 FSP 50 South Tenth Street Corp 5.02,9.01 12/15/11 FSP GALLERIA NORTH CORP 5.02,9.01 12/15/11 FSP PHOENIX TOWER CORP 5.02,9.01 12/15/11 FTI CONSULTING INC MD 5.02,9.01 12/13/11 FULLCIRCLE REGISTRY INC NV 8.01,9.01 10/31/11 GABRIEL TECHNOLOGIES CORP DE 8.01 12/12/11 Genie Energy Ltd. DE 5.02 12/13/11 Gold Holding Corp. 1.01,3.02 12/13/11 Goliath Film & Media Holdings NV 1.01,2.01,3.02,5.01, 5.02, 8.01,9.01 10/25/11 AMEND Grand Canyon Education, Inc. DE 8.01 12/13/11 GRANT PARK FUTURES FUND LIMITED PARTN IL 7.01,9.01 12/09/11 GRAPHIC PACKAGING HOLDING CO DE 8.01,9.01 12/09/11 GREATBATCH, INC. DE 2.03,8.01,9.01 12/15/11 GREEN ENERGY GROUP INC. FL 4.01,9.01 12/15/11 AMEND GREENBRIER COMPANIES INC OR 1.01,2.03 12/12/11 Gunpowder Gold Corp NV 5.02,8.01 12/15/11 GYRODYNE CO OF AMERICA INC NY 5.07 12/09/11 GYRODYNE CO OF AMERICA INC NY 7.01,9.01 12/09/11 AMEND HAMPTON ROADS BANKSHARES INC VA 7.01,9.01 12/15/11 HANSEN NATURAL CORP DE 7.01,9.01 12/15/11 HARBINGER GROUP INC. DE 2.02,9.01 12/14/11 AMEND HARRIS CORP /DE/ DE 8.01 12/12/11 HEICO CORP FL 2.02,9.01 12/15/11 HELIX ENERGY SOLUTIONS GROUP INC MN 5.02,9.01 12/09/11 HERCULES OFFSHORE, INC. DE 7.01,9.01 12/15/11 HERITAGE COMMERCE CORP CA 7.01,9.01 12/15/11 HINES REAL ESTATE INVESTMENT TRUST IN 7.01,9.01 12/15/11 HOVNANIAN ENTERPRISES INC DE 2.02,9.01 12/15/11 HUNTINGTON INGALLS INDUSTRIES, INC. DE 5.05 12/14/11 IDT CORP DE 5.02 12/13/11 IFLI Acquisition Corp. DE 5.03,8.01,9.01 12/15/11 IMEDIA INTERNATIONAL INC DE 5.01,5.02,7.01 12/15/11 IMMERSION CORP DE 5.02,9.01 12/15/11 Imperial Holdings, Inc. 8.01 12/13/11 INDEPENDENT BANK CORP MA 8.01 12/15/11 INLAND REAL ESTATE CORP MD 8.01,9.01 12/15/11 INPHI Corp DE 5.07 12/08/11 INSTEEL INDUSTRIES INC NC 2.03 12/12/11 INTERNATIONAL FLAVORS & FRAGRANCES IN NY 5.02 12/13/11 IRVINE SENSORS CORP/DE/ DE 1.01,1.02,2.02,2.03, 3.02,9.01 12/09/11 ISRAEL GROWTH PARTNERS ACQUISITION CO DE 1.01,9.01 12/14/11 JBI, INC. NV 8.01,9.01 12/15/11 Jingwei International LTD NV 5.02 12/13/11 KBR, INC. DE 5.02,9.01 12/15/11 KILLBUCK BANCSHARES INC OH 8.01,9.01 12/15/11 Kohlberg Capital CORP DE 5.02 12/09/11 LAM RESEARCH CORP DE 1.01,9.01 12/14/11 Lantheus Medical Imaging, Inc. DE 1.01 12/14/11 Liberty Global, Inc. DE 7.01 12/15/11 Liberty Global, Inc. DE 7.01 12/15/11 Liberty Global, Inc. DE 2.03,8.01,9.01 12/15/11 Liberty Interactive Corp 5.02,8.01 12/09/11 LIVEDEAL INC NV 1.01,1.02,2.02,3.02, 5.02,5.03, 5.07,7.01, 9.01 12/12/11 LOCAL.COM DE 1.01,5.02,9.01 12/09/11 LORAN CONNECTION CORP NV 5.01,5.02 12/14/11 MAGELLAN HEALTH SERVICES INC DE 1.01 12/09/11 AMEND MARCUS CORP WI 2.02,9.01 12/15/11 MARTIN MARIETTA MATERIALS INC NC 5.02,8.01,9.01 12/15/11 MARVELL TECHNOLOGY GROUP LTD D0 8.01,9.01 12/14/11 MASS MEGAWATTS WIND POWER INC MA 2.02,9.01 12/15/11 MBIA INC CT 8.01 12/15/11 MCT HOLDING CORP 5.01,5.02 12/15/11 Medical Care Technologies Inc. NV 1.01,2.03,9.01 12/09/11 MEDIVATION, INC. DE 5.02,9.01 12/09/11 Memorial Production Partners LP DE 1.01,2.01,2.03,3.02, 5.02, 5.03,9.01 12/14/11 MEMSIC Inc 1.01,2.03 11/23/11 Mesa Energy Holdings, Inc. DE 7.01,9.01 12/13/11 MORGANS FOODS INC OH 1.01,1.02,2.01,2.03 12/09/11 NATIONAL TECHNICAL SYSTEMS INC /CA/ CA 2.02,9.01 12/14/11 NCI, Inc. DE 5.02,9.01 12/14/11 NEOPROBE CORP DE 1.01,5.02,8.01,9.01 12/09/11 NETSUITE INC DE 1.01,9.01 12/09/11 NeurogesX Inc CA 8.01,9.01 12/15/11 NEUROLOGIX INC/DE DE 5.02 12/12/11 NEW ENERGY SYSTEMS GROUP NV 2.01 12/09/11 New England Bancshares, Inc. 5.03,9.01 12/12/11 NEW YORK TIMES CO NY 5.02,9.01 12/15/11 NEWS CORP 8.01,9.01 12/15/11 NextWave Wireless Inc. DE 1.01,9.01 12/14/11 NICOR INC IL 1.01,2.03,9.01 12/09/11 NORTEL NETWORKS CORP 5.02,8.01,9.01 11/11/11 NORTH EUROPEAN OIL ROYALTY TRUST DE 8.01 10/31/11 NORTHERN ILLINOIS GAS CO /IL/ /NEW/ IL 1.01,2.03,4.01,5.01, 5.03, 8.01,9.01 12/09/11 NORTHERN OIL & GAS, INC. 7.01,9.01 12/15/11 NorthStar Real Estate Income Trust, I MD 7.01 12/09/11 NOVELLUS SYSTEMS INC CA 1.01,9.01 12/14/11 Novo Energies Corp FL 1.01,1.02,2.03,5.06, 8.01,9.01 12/15/11 OLD NATIONAL BANCORP /IN/ IN 8.01 12/15/11 Omagine, Inc. DE 8.01 12/15/11 Orexigen Therapeutics, Inc. DE 8.01,9.01 12/15/11 OUTDOOR CHANNEL HOLDINGS INC 5.02,8.01,9.01 12/13/11 PAN AMERICAN GOLDFIELDS LTD DE 1.01 12/12/11 PDL BIOPHARMA, INC. DE 8.01,9.01 12/15/11 Pebblebrook Hotel Trust MD 7.01,8.01,9.01 12/15/11 PHYSICIANS FORMULA HOLDINGS, INC. DE 5.07 12/14/11 PHYSICIANS FORMULA HOLDINGS, INC. DE 5.02,7.01,9.01 12/09/11 PIER 1 IMPORTS INC/DE DE 2.02,9.01 12/15/11 PINNACLE ENTERTAINMENT INC. DE 5.02,9.01 12/09/11 Pioneer Southwest Energy Partners L.P DE 1.01,7.01,9.01 12/13/11 PIZZA INN HOLDINGS, INC /MO/ 5.07 12/14/11 PLAINS ALL AMERICAN PIPELINE LP DE 1.01,2.03,9.01 12/09/11 PRAXAIR INC DE 8.01,9.01 12/15/11 Premier Beverage Group Corp NV 2.04,3.02,9.01 12/09/11 PRICESMART INC DE 8.01 12/15/11 Primerica, Inc. DE 1.01,8.01,9.01 12/13/11 PROCERA NETWORKS INC NV 3.01,9.01 12/09/11 PROFESSIONAL VETERINARY PRODUCTS LTD NE 1.03,9.01 12/13/11 PSM HOLDINGS INC NV 5.02,5.07,9.01 12/12/11 PURE BIOSCIENCE, INC. DE 1.01,1.02,2.02,3.02, 8.01,9.01 12/14/11 QUICKLOGIC CORPORATION CA 1.01,5.02 12/09/11 QUIKSILVER INC DE 2.02,8.01,9.01 12/15/11 Rackwise, Inc. NV 1.01 11/22/11 Radius Health, Inc. DE 1.01,3.02,5.02,9.01 12/09/11 RAILAMERICA INC /DE DE 5.02 12/12/11 RealD Inc. DE 7.01,9.01 12/13/11 Redpoint Bio CORP 8.01 12/13/11 RENTECH INC /CO/ CO 2.02,9.01 12/15/11 Rentech Nitrogen Partners, L.P. DE 2.02,9.01 12/15/11 RESEARCH FRONTIERS INC DE 7.01,9.01 12/15/11 RESMED INC DE 5.02 12/14/11 RITE AID CORP DE 2.02,9.01 12/15/11 Rock Energy Resources, Inc. DE 7.01,9.01 12/14/11 Rock Energy Resources, Inc. DE 7.01,9.01 12/15/11 ROYAL GOLD INC DE 1.01,2.01,8.01,9.01 12/14/11 RURAL ELECTRIC COOPERATIVE GRANTOR TR NY 8.01,9.01 12/15/11 SCHIFF NUTRITION INTERNATIONAL, INC. DE 2.02,9.01 12/15/11 SCHOLASTIC CORP DE 2.02,9.01 12/15/11 SCHOLASTIC CORP DE 2.02,9.01 12/15/11 AMEND SEARS HOLDINGS CORP DE 5.02 12/09/11 Selway Capital Acquisition Corp. DE 8.01,9.01 12/14/11 ShengdaTech, Inc. 3.01 12/09/11 Shengkai Innovations, Inc. FL 8.01,9.01 12/15/11 Sibling Entertainment Group Holdings, TX 5.02 12/01/11 Silicon Graphics International Corp DE 5.02 12/11/11 SOHU COM INC DE 8.01 12/15/11 SolarWinds, Inc. DE 1.01,2.01,9.01 12/15/11 SONOSITE INC 1.01,8.01,9.01 12/15/11 SOUTHWEST AIRLINES CO TX 1.01,8.01,9.01 12/13/11 SOUTHWEST BANCORP INC OK 1.01,9.01 12/01/11 SOUTHWEST BANCORP INC OK 2.01,8.01,9.01 12/13/11 SPAN AMERICA MEDICAL SYSTEMS INC SC 1.01,2.01,2.03,9.01 12/09/11 SPHERIX INC DE 5.03,9.01 11/28/11 STARTEK INC DE 5.02,9.01 12/12/11 STATE BANCORP INC NY 8.01,9.01 12/14/11 Steel Excel Inc. DE 8.01,9.01 12/14/11 STEIN MART INC FL 3.01,9.01 12/14/11 STEWARDSHIP FINANCIAL CORP NJ 8.01,9.01 12/14/11 Sun Life Assurance Co of Canada (U.S. DE 2.05,8.01 12/12/11 SUN RIVER ENERGY, INC CO 1.02,7.01,9.01 12/12/11 Surge Global Energy, Inc. DE 5.02,8.01 12/15/11 SXC Health Solutions Corp. A6 5.02 12/14/11 Symmetry Medical Inc. DE 1.01,2.03,5.02, 8.01,9.01 12/11/11 SYNERGY RESOURCES CORP CO 8.01,9.01 12/15/11 Tamir Biotechnology, Inc. DE 1.01 12/15/11 TE Connectivity Ltd. V8 1.01 12/14/11 TECH DATA CORP FL 8.01,9.01 12/14/11 TEXAS INSTRUMENTS INC DE 3.01,9.01 12/15/11 Thompson Creek Metals CO Inc. A6 1.01,8.01,9.01 12/14/11 THQ INC DE 5.02 12/09/11 TORCH ENERGY ROYALTY TRUST DE 1.01,2.01,9.01 12/13/11 TORCHMARK CORP DE 8.01,9.01 12/12/11 TRANS1 INC 7.01,9.01 12/14/11 Transocean Ltd. V8 7.01,9.01 12/15/11 TRIDENT MICROSYSTEMS INC DE 5.02,9.01 12/11/11 TUFCO TECHNOLOGIES INC DE 2.02,7.01,9.01 12/14/11 U S PHYSICAL THERAPY INC /NV NV 8.01 12/12/11 UMH PROPERTIES, INC. MD 7.01,9.01 12/15/11 UMH PROPERTIES, INC. MD 7.01,9.01 12/15/11 UMPQUA HOLDINGS CORP OR 8.01 12/15/11 UNISOURCE ENERGY CORP AZ 5.02,5.03,9.01 12/14/11 Verecloud, Inc. NV 2.02,9.01 12/15/11 Vican Resources, Inc. NV 5.02 12/15/11 VIEWCAST COM INC DE 1.01,5.02,9.01 12/09/11 ViewPoint Financial Group Inc. MD 8.01 12/13/11 VIPER POWERSPORTS INC NV 3.02 12/15/11 VLOV INC. NV 7.01,9.01 12/15/11 VSB BANCORP INC NY 8.01 12/14/11 WaferGen Bio-systems, Inc. NV 1.01,3.03,9.01 12/09/11 WARWICK VALLEY TELEPHONE CO NY 5.02,9.01 12/14/11 WASHINGTON TRUST BANCORP INC RI 5.05 12/15/11 WAYNE SAVINGS BANCSHARES INC /DE/ DE 7.01,9.01 12/15/11 WEBSTER FINANCIAL CORP DE 5.02,9.01 12/15/11 WELLS FARGO & CO/MN DE 9.01 12/15/11 Western Gas Partners LP DE 1.01,7.01,9.01 12/15/11 Western Standard Energy Corp. NV 5.02 12/15/11 Western Union CO DE 7.01,8.01,9.01 12/15/11 Westway Group, Inc. DE 8.01,9.01 12/15/11 Williams Partners L.P. 5.02 12/12/11 WINNEBAGO INDUSTRIES INC IA 2.02 12/15/11 XCel Brands, Inc. DE 1.01,2.01,3.02,4.01, 5.02,5.03, 5.05,5.06, 9.01 09/29/11 AMEND XFONE INC. NV 8.01 12/15/11 XFONE INC. NV 8.01 12/15/11 YOUNG INNOVATIONS INC MO 8.01 12/15/11 Z3 ENTERPRISES, INC. NV 1.02,9.01 12/09/11 ZBB ENERGY CORP WI 1.01,3.02,9.01 12/13/11 ZIONS BANCORPORATION /UT/ UT 9.01 12/15/11