SEC Chairman Mary Schapiro to Step Down Next Month
After nearly four years in office, SEC Chairman Mary L. Schapiro today announced that she will step down on Dec. 14, 2012.
Chairman Schapiro, who became chairman in the wake of the financial crisis in January 2009, strengthened, reformed, and revitalized the agency. She oversaw a more rigorous enforcement and examination program, and shaped new rules by which Wall Street must play.
“It has been an incredibly rewarding experience to work with so many dedicated SEC staff who strive every day to protect investors and ensure our markets operate with integrity,” said Chairman Schapiro. “Over the past four years we have brought a record number of enforcement actions, engaged in one of the busiest rulemaking periods, and gained greater authority from Congress to better fulfill our mission.”
Chairman Schapiro is one of the longest-serving SEC chairmen, having served longer than 24 of the previous 28. She was appointed by President Barack Obama on Jan. 20, 2009, and unanimously confirmed by the Senate.
During her tenure, Chairman Schapiro worked to bolster the SEC’s enforcement and examination programs, among others. As a result of a series of reforms, the agency is more adept at pursing tips and complaints provided by outsiders, better able to identify wrongdoers through vastly upgraded market intelligence capabilities, and more strategic, innovative and risk-focused in the way it inspects financial firms.
In each of the past two years, the agency has brought more enforcement actions than ever before, including 735 enforcement actions in fiscal year 2011 and 734 actions in FY 2012.
In addition, the SEC engaged in one of the busiest rulemaking periods in decades. Due to new rules now in place, investors can get clear information about the advisers they invest with, vote on the executive compensation packages at companies they invest in, benefit from additional safeguards that protect their assets held by investment advisers, and get access to more meaningful information about company boards and municipal securities.
“I’ve been so amazed by how hard the men and women of the agency work each and every day and by the sacrifices they make to get the job done,” added Chairman Schapiro. “So often they stay late or come in on weekends to polish a legal brief, review a corporate filing, write new rules, or reconstruct trading events. And despite the complexity and the intense scrutiny, they always excel at what they do.”
As a result of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the agency has implemented a new whistleblower program, strengthened regulation of asset-backed securities, laid the foundation for an entirely new regulatory regime for the previously-unregulated derivatives market, and required advisers to hedge funds and other private funds to register and be subject to SEC rules.
During Chairman Schapiro’s tenure, the agency worked to improve the structure of the market by approving a series of measures that have helped to strengthen equity market structure and reduce the chance of another Flash Crash. Among other things, the Commission for the first time has required the exchanges to create a consolidated audit trail that will enable the agency to reconstruct trading across various trading venues.
Chairman Schapiro previously served as a commissioner at the SEC from 1988 to 1994. She was appointed by President Ronald Reagan, reappointed by President George H.W. Bush in 1989, and named Acting Chairman by President Bill Clinton in 1993. She left the SEC when President Clinton appointed her as chairman of the Commodity Futures Trading Commission, where she served until 1996. She is the only person to have ever served as chairman of both the SEC and CFTC.
As SEC chairman, Schapiro also serves on the Financial Stability Oversight Council, the FHFA Oversight Board, the Financial Stability Oversight Board, and the IFRS Foundation Monitoring Board. (Press Rel. 2012-240)
In the Matter of John S. Morgan, Marian I. Morgan, and Thomas D. Woodcock, Jr.
On November 26, 2012, the Commission issued an Order Making Findings and Imposing Remedial Sanctions (Order) against Marian I. Morgan.
In the Order, the Commission found that on July 5, 2012, a final judgment was entered by default against Marian I. Morgan, permanently enjoining her from future violations of Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933, Sections 10(b) and 15(a) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder, in the civil action entitled Securities and Exchange Commission v. John S. Morgan, et al., Civil Action Number 8:09-cv-1093-RAL-EAJ, in the United States District Court for the Middle District of Florida. The Commission’s complaint in that action alleged that from 2006 through June 2009 Ms. Morgan engaged in a scheme to defraud investors by offering and selling investments in a fictitious prime bank instrument trading program. The complaint also alleged that Ms. Morgan sold unregistered securities.
Based on the above, the Order bars Ms. Morgan from association with any broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or nationally recognized statistical rating organization, and from participating in any offering of a penny stock. Ms. Morgan consented to the issuance of the Order without admitting or denying any of the findings, except that she admitted the entry of the injunction against her. (Rel. 34-68289; File No. 3-14967)
Attorney Virginia K. Sourlis Found Liable for Aiding and Abetting Securities Fraud by Issuing False Legal Opinion in Connection with Illegal Stock Offering
On November 20, 2012, the Federal District Court in SEC v. Greenstone Holdings, Inc., et al., 10 civ. 1302 (S.D.N.Y.), granted the SEC partial summary judgment against attorney Virginia K. Sourlis, holding Sourlis liable for aiding and abetting securities fraud by issuing a false legal opinion that certain of her co-defendants used to obtain illegally more than six million shares of unrestricted stock of Greenstone Holdings, Inc.
According to the SEC’s summary judgment motion, in early 2006, Sourlis intentionally authored a materially false and misleading legal opinion, which Greenstone used to illegally issue over six million shares of stock in unregistered transactions. Among other things, Sourlis falsely described promissory notes, note holders, and communications with those holders, none of which actually existed. The SEC asserted that, contrary to Sourlis’ fraudulent opinion letter, the stock issuance did not qualify for an exemption from registration under the federal securities laws.
In finding Sourlis liable for fraud, at the November 16, 2012 hearing on the SEC’s summary judgment motion, the District Court stated that Sourlis’ opinion “represents that Ms. Sourlis spoke to note-holders which did not exist . . . And several other facts for which there was no evidentiary support.” The Court further stated that Sourlis’ opinion “represented as fact matters that were contrary to fact, and to me the most egregious representation was the representation that the writer of the letter had spoken to the original note-holders which is repeated in the letter.”
The Court held Sourlis liable for aiding and abetting securities fraud under Section 10(b) of the Securities Exchange Act of 1934 but denied the SEC summary judgment against Sourlis for primary liability under Section 10(b). The Court also reserved decision on the SEC’s non-fraud claim that Sourlis violated Section 5 of the Securities Act of 1933. On the basis of the Court’s November 20 liability holding, the SEC intends to seek from the Court against Sourlis injunctive relief, financial penalties, disgorgement, and a penny stock bar. [SEC v. Greenstone Holdings, Inc. et al., Civil Action No. 10-cv-1302 (S.D.N.Y.)] (LR-22542)
SEC Settles with Former Integral Systems Chief Financial Officer Charged with Securities Fraud
The Securities and Exchange Commission (“Commission”) announced today that it has finalized a settlement with Elaine M. Brown, the former Chief Financial Officer of Integral Systems, Inc. (“Integral Systems” or the “Company”). In July 2009, the Commission charged Brown in connection with the concealment at the Company of a de facto officer who was a securities fraud felon. Without admitting or denying the Commission’s allegations, Brown consents to a $25,000 civil money penalty. The final judgment will resolve the Commission’s matter against Brown.
The Commission settled with the Company in an administrative proceeding in July 2009. See Litigation Release No. 21159. In early 2010, the Commission dismissed charges against the Company’s former Chairman and Chief Executive Officer, Steven R. Chamberlain, following his death. Litigation continues against Gary A. Prince. [SEC v. Elaine M. Brown and Gary A. Prince, Civil Action No. 09-cv-01423 (D. D.C.)] (LR-22543)
Court Enters Final Judgments By Consent Against SEC Defendants Pantera Petroleum, Inc. and Bozidar “Bob” Vukovich
The Securities and Exchange Commission announced that on December 16, 2011, the Honorable Colleen McMahon, United States District Court Judge for the Southern District of New York, entered a final judgment by consent against Defendant Pantera Petroleum, Inc. (“Pantera”). The final judgment permanently enjoins Pantera from future violations of Sections 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.
On April 2, 2012, the Court entered a final judgment by consent against Defendant Bozidar “Bob” Vukovich, permanently enjoining Vukovich from future violations of Sections 17(a) of the Securities Act, Section 10(b) of the Securities Exchange Act, and Rule 10b-5 thereunder. The final judgment also: (i) orders Vukovich to pay $113,575 in disgorgement, plus $18,596.04 in prejudgment interest; (ii) orders Vukovich to pay a $130,000 civil penalty; and (iii) permanently bars Vukovich from participating in an offering of penny stock.
The Commission’s complaint, filed on January 24, 2011 in federal court in Manhattan, alleges that Christopher Metcalf, Pantera’s former President and CEO, and Vukovich, a stock promoter, engaged in a fraudulent broker-bribery scheme designed to manipulate the market for Pantera common stock.
For further information, please see Litigation Release Number 21824 (January 25, 2011) [Securities and Exchange Commission v. Christopher S. Metcalf, Bozidar “Bob” Vukovich, and Pantera Petroleum, Inc., Civil Action No. 11 Civ. 0493 (CM) (S.D.N.Y.)] and Litigation Release Number 22538 (November 20, 2012) [Court Fines CEO Christopher Metcalf $50,000 and Imposes a Penny Stock Bar and Officer and Director Bar Against Him].
The SEC acknowledges the assistance of the United States Attorney’s Office for the Southern District of New York and the Federal Bureau of Investigation in this matter. [SEC v. Christopher S. Metcalf, Bozidar “Bob” Vukovich, and Pantera Petroleum, Inc., Civil Action No. 11-cv-0493 (CM) (S.D.N.Y.)] (LR-22544)
Van Eck Funds, et al.
An order has been issued on an application filed by Van Eck Funds, et al., under Section 17(d) of the Investment Company Act of 1940 (Act) and Rule 17d-1 under the Act. The order permits certain registered open-end management investment companies to co-invest in covered private placements with each other and/or with one or more affiliated private investment companies. (Rel. IC-30279 - November 23)
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.
S-4 FIRSTMERIT CORP /OH/, III CASCADE PLAZA, 7TH FLOOR, AKRON, OH, 44308, 3309966300 - 0 ($769,056,351.00) Equity, (File 333-185121 - Nov. 23) (BR. 07C) S-8 RECOVERY ENERGY, INC., 1515 WYNKOOP STREET, SUITE 200, DENVER, CO, 80202, 888-991-1114 - 900,000 ($2,439,000.00) Equity, (File 333-185122 - Nov. 23) (BR. 04A) S-1 Northern Tier Energy LP, 38C GROVE STREET, SUITE 100, RIDGEFIELD, CT, 06877, (203) 244-6550 - 0 ($250,000,000.00) Limited Partnership Interests, (File 333-185124 - Nov. 23) (BR. 04B) S-8 DECISION DIAGNOSTICS CORP, 2660 TOWNSGATE ROAD, SUITE 300, WESTLAKE VILLAGE, CA, 91361, 8054461973 - 15,000,000 ($1,500,000.00) Equity, (File 333-185125 - Nov. 23) (BR. 09A) S-4 Molycorp, Inc., 5619 DENVER TECH CENTER PARKWAY, SUITE 1000, GREENWOOD VILLAGE, CO, 80111, (303) 843-8040 - 0 ($650,000,000.00) Debt, (File 333-185126 - Nov. 23) (BR. 09B) S-3 NovaCopper Inc., SUITE 2300 - 200 GRANVILLE STREET, VANCOUVER, A1, V6C 1S4, (604) 669-6227 - 0 ($100,000,000.00) Equity, (File 333-185127 - Nov. 23) (BR. 09) S-11 Select Income REIT, TWO NEWTON PLACE, 255 WASHINGTON STREET, SUITE 300, NEWTON, MA, 02458-1634, 617-332-3990 - 0 ($176,847,000.00) Equity, (File 333-185131 - Nov. 23) (BR. 08B) S-3ASR FIRSTMERIT CORP /OH/, III CASCADE PLAZA, 7TH FLOOR, AKRON, OH, 44308, 3309966300 - 0 ($0.00) Unallocated (Universal) Shelf, (File 333-185132 - Nov. 23) (BR. 07C)
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 ----------------------------------------------------------------------------------------- ACCENTIA BIOPHARMACEUTICALS INC FL 2.04 11/17/12 AMERICAN INTERNATIONAL GROUP INC DE 8.01,9.01 11/21/12 American Standard Energy Corp. DE 1.01,2.01,9.01 11/16/12 AXION INTERNATIONAL HOLDINGS, INC. CO 2.02,9.01 11/21/12 BILL BARRETT CORP DE 7.01,9.01 11/20/12 BIOVEST INTERNATIONAL INC DE 1.01,2.04 11/17/12 BOLT TECHNOLOGY CORP CT 5.07,8.01,9.01 11/20/12 CHIPOTLE MEXICAN GRILL INC 8.01,9.01 11/20/12 CITIGROUP INC DE 8.01 11/21/12 CNS RESPONSE, INC. DE 5.02 11/18/12 DAYSTAR TECHNOLOGIES INC DE 3.01,9.01 11/23/12 DAYSTAR TECHNOLOGIES INC DE 5.02,9.01 11/23/12 Federal Home Loan Bank of Chicago X1 2.03 11/20/12 Federal Home Loan Bank of Des Moines X1 2.03,9.01 11/20/12 Federal Home Loan Bank of New York X1 2.03,9.01 11/19/12 Federal Home Loan Bank of Pittsburgh PA 2.03,9.01 11/19/12 Federal Home Loan Bank of San Francis X1 2.03 11/19/12 Federal Home Loan Bank of Seattle 2.03 11/20/12 FIDELITY BANCORP INC PA 2.02,9.01 11/21/12 FIRSTMERIT CORP /OH/ OH 8.01,9.01 11/21/12 FLUSHING FINANCIAL CORP DE 8.01,9.01 11/23/12 Freescale Semiconductor, Ltd. D0 8.01 11/23/12 GENESIS GROUP HOLDINGS INC 1.01,3.02,3.03,5.03, 11/16/12 9.01 GEOPETRO RESOURCES CO CA 4.01,9.01 11/19/12 GLOBAL AXCESS CORP NV 5.02,9.01 11/21/12 GLOBALWISE INVESTMENTS INC NV 1.01,2.03,9.01 11/16/12 GOLDMAN SACHS GROUP INC DE 9.01 11/23/12 Green Innovations Ltd. 8.01,9.01 11/14/12 iBio, Inc. DE 3.01,8.01,9.01 11/21/12 Industrial Income Trust Inc. MD 1.01 11/16/12 IPARTY CORP DE 3.01,9.01 11/20/12 KENEXA CORP 3.01 11/20/12 KENEXA CORP 8.01,9.01 11/20/12 KRISPY KREME DOUGHNUTS INC NC 5.04,9.01 11/21/12 L & L ENERGY, INC. NV 1.01,8.01,9.01 11/21/12 LEXARIA CORP. NV 1.01,2.03,7.01,9.01 11/23/12 LifeCare Holdings, Inc. DE 5.02 11/18/12 MAGELLAN PETROLEUM CORP /DE/ DE 3.01 11/23/12 MGT CAPITAL INVESTMENTS INC DE 5.02,9.01 11/19/12 Molycorp, Inc. DE 8.01,9.01 11/21/12 MPHASE TECHNOLOGIES INC NJ 2.04 11/23/12 Mueller Water Products, Inc. DE 4.02,9.01 11/19/12 MYOS Corp NV 5.07 11/20/12 Net Element International, Inc. E9 5.02,9.01 11/16/12 NEWS CORP 8.01,9.01 11/22/12 NEXSTAR BROADCASTING GROUP INC DE 8.01,9.01 11/21/12 ORGANOVO HOLDINGS, INC. DE 7.01,9.01 11/23/12 ORGANOVO HOLDINGS, INC. DE 7.01 11/23/12 OSI SYSTEMS INC DE 8.01 11/21/12 PASSPORT POTASH INC A8 1.01,8.01,9.01 11/08/12 PC TEL INC DE 8.01,9.01 11/16/12 PEAPACK GLADSTONE FINANCIAL CORP NJ 5.02,9.01 11/20/12 PROVECTUS PHARMACEUTICALS INC NV 8.01 11/23/12 PROVIDENCE SERVICE CORP DE 5.02,7.01,9.01 11/19/12 PROVIDENT FINANCIAL SERVICES INC DE 7.01,9.01 11/23/12 REALGOLD INTERNATIONAL INC NV 1.01,3.02,9.01 11/21/12 SALAMON GROUP INC 5.02 11/23/12 Sanchez Energy Corp DE 1.01,2.03,9.01 11/16/12 SBT Bancorp, Inc. CT 8.01,9.01 11/20/12 SEQUENTIAL BRANDS GROUP, INC. DE 5.02 11/23/12 Shire plc 8.01,9.01 11/21/12 Sino-Global Shipping America, Ltd. VA 3.01 11/21/12 SPECTRUM PHARMACEUTICALS INC DE 7.01 11/21/12 SPS COMMERCE INC DE 5.02,9.01 11/19/12 Sputnik Enterprises, Inc NV 1.01,3.02,5.01,5.02, 11/23/12 5.03,5.06,9.01 SWIFT TRANSPORTATION Co 8.01 11/21/12 SYNERGETICS USA INC 5.02 11/16/12 T & G APOTHECARY INC NV 1.01,9.01 11/23/12 TCF FINANCIAL CORP DE 5.02 11/23/12 Texas Rare Earth Resources Corp. DE 8.01 11/14/12 TIANYIN PHARMACEUTICAL CO., INC. DE 7.01,9.01 11/15/12 TOA Distribution Systems Inc. DE 5.02,9.01 11/17/12 Volcano Corp DE 8.01,9.01 11/22/12 WEB.COM GROUP, INC. DE 1.01,2.03,7.01,9.01 11/19/12 Western Standard Energy Corp. NV 1.01,3.02,5.01,9.01 11/09/12 WORLD HEALTH ENERGY HOLDINGS, INC. DE 5.02,9.01 11/23/12 XPO Logistics, Inc. 7.01,8.01,9.01 11/21/12