Archive

March 30, 2016

Biotech venture capitalist G. Steven Burrill and his firm, Burrill Capital Management, will pay $5.785 million to settle charges that Burrill siphoned money from the Burrill Life Sciences Capital Fund III under the guise of “advanced” management fees to fund his lavish lifestyle.  The SEC’s order also found Burrill Capital Management’s Chief Legal Officer and Controller to have played integral roles in Burrill’s scheme.  They will pay $275,000 combined to settle the SEC’s charges.  SEC

April 29, 2016

Michigan announced that a judge has ordered Shawn Dicken, of Bay City, to pay $663, 531.48 in restitution for her role in an extensive multi-county Ponzi scheme. Dicken was convicted in 2014 after an Attorney General investigation and sentenced to 140 months to 20 years in prison. Beginning in 2011, Dicken was employed as the lead salesperson for The Diversified Group Advisory Firm LLC, an investment company. During her tenure with Diversified, Dicken misrepresented the investments she marketed to investors, saying investments offered by Diversified were without risk, completely liquid, featuring a guaranteed rate of return of between 9.5% and 10.44%. Dicken failed to disclose the risks associated with the actual investment in question – a highly leveraged real estate investment that could result in the loss of all of the investors’ money. Many investors, including senior citizens, risked their life savings. Dicken swindled investors out of more than two million dollars and investigation revealed she took an eight percent commission, pocketing approximately $160,000 for herself. MI

April 12, 2016

Brian Hinman agreed to pay over $1 million in penalties and disgorgement to settle charges that he aided and abetted Kevin White's Texas-based entities’ RFF GP, LLC and KGW Capital Management, LLC, in a scheme that fraudulently solicited participants in a foreign currency exchange pool named Revelation Forex Fund, LP.  CFTC

April 5, 2016

A federal court has ordered UAE residents Heet Khara and Nasim Salim to pay $2.69 million in civil penalties for spoofing in the gold and silver futures markets.  CFTC

March 31, 2016

The CFTC filed a civil enforcement action against Hendrik A. Van Beuningen of Brookhaven, Georgia, and his company, DeBrink Trading Fund I, LLC of Atlanta, Georgia, alleging fraud, misappropriation, and issuing false statements in connection with a commodity pool they operated.  CFTC

March 30, 2016

Chung Yu Yeung (aka Louis Yeung), former vice president of Eastern Tools and Equipment Inc., a California wholesale equipment company that sold portable generators to retailers across the country, pleaded guilty to fraud charges in connection with a bank fraud scheme.  Yeung admitted that he and his co-conspirators defrauded Pasadena-based East West Bank in connection with a line of credit for Eastern Tools by misrepresenting to the bank Eastern Tools’ accounts receivable and its financial statements.  Eastern Tools ultimately defaulted causing more than $9 million in losses to the bank.  DOJ

March 29, 2016

AVEO Pharmaceuticals Inc. will pay $4 million to settle charges that it mislead investors about its efforts to obtain FDA approval for Tivozanib, its flagship developmental drug to treat kidney cancer.  The SEC alleges that AVEO concealed the FDA’s level of concern about Tivozanib in public statements to investors by omitting the critical fact that FDA staff had recommended a second clinical trial to address concerns about patient death rates during the first clinical trial.  When the FDA made public months later that it had recommended an additional clinical trial, the company’s stock price declined 31 percent.  AVEO never conducted an additional trial and the FDA later refused to approve Tivozanib.  The SEC also filed charges against AVEO’s former CEO, CFO, and CMO.  These charges remain outstanding.  SEC

March 29, 2016

Former market analyst and TV news commentator Tobin Smith and his company NBT Group Inc. will pay over $250,000 to settle charges that they fraudulently promoted a penny stock to investors.  The SEC alleged that Smith and NBT were paid to prepare and disseminate communications touting the stock of IceWEB Inc., a data storage company.  Smith and NBT did not fully disclose their compensation to investors.  In addition, the promotional material contained false and misleading statements intended to artificially increase the trading volume and share price of IceWEB’s stock.  SEC

March 28, 2016

The SEC charged New York-based securities professional Andrew W.W. Caspersen with soliciting approximately $95 million from two institutional investors by offering promissory notes issued by Irving Place III SPV LLC.  The SEC alleges that Irving Place III SPV LLC is a shell entity formed and controlled by Caspersen with no legitimate business operations, unlike the similarly named Irving Place Capital Partners III SPV which is not associated with Caspersen in any way.  Caspersen obtained a $25 million investment in November 2015 from an institutional investor by falsely representing that the investment would be secured by approximately $900 million of assets of Irving Place Capital Partners III SPV.  SEC

March 25, 2016

The SEC brought fraud charges and obtained asset freezes against New Jersey fund manager John Bivona and his firms Saddle River Advisors and SRA Management Associates for marketing shares in promising pre-IPO tech companies in the Bay Area while stealing $5.7 million and diverting millions more to other improper and undisclosed uses.  The SEC alleges that Bivona used money raised through his firms to pay off earlier investors, prop up other funds, and pay family-related expenses.  He secretly steered the lion’s share of misappropriated funds to his nephew Frank Mazzola who was barred from the securities industry in a prior SEC enforcement action.  The SEC alleges that while Bivona raised more than $53 million from investors, the money he siphoned away for undisclosed uses left his firms continuously short of the cash needed to buy the shares promised to investors.  SEC