Archive

April 9, 2015

Katsuichi Fusamae, a senior accounting officer at Molex Japan Co. Ltd., agreed to settle SEC charges he cost his company millions of dollars in trading losses and manipulated accounting records to avoid detection.  Specifically, the SEC alleged Fusamae engaged in unauthorized equity trading in the company’s brokerage accounts that resulted in losses of more than $110 million and then concealed the losses by taking out unauthorized and undisclosed company loans with Japanese banks and brokerage firms to replenish account balances.  Fusamae admitted wrongdoing and accepted a permanent bar from serving as an officer or director of a publicly traded company with possible monetary sanctions to come.  SEC

April 9, 2015

The SEC announced fraud charges and an asset freeze against the operators of a South Florida-based microcap scheme spearheaded by Dean A. Esposito, Joseph DeVito, and Frederick Birks, all hired by the CEO of eCareer Holdings, Inc. Joseph J. Azzata.  According to the SEC, more than $11 million were raised from more than 400 investors by telling them their money would be used as working capital to develop eCareer’s online job staffing business when in reality much of it was diverted to pay exorbitant fees to the brokers and sales agents.  SEC

April 7, 2015

The SEC charged Los Angeles-based Pacific West Capital Group Inc. and its owner Andrew B. Calhoun IV with fraud in the sale of “life settlement” investments.  The SEC’s complaint alleges since at least 2012, Pacific West and Calhoun defrauded investors by using proceeds from the sale of new life settlements to continue funding life settlement investments sold years earlier to make life settlement investments appear successful.  SEC  

April 7, 2015

The SEC announced fraud charges against former professional football player William D. Allen and his business partner Susan C. Daub and others, alleging they operated a Ponzi scheme that raised more than $31 million from investors who were promised profits from loans to professional athletes.  SEC

April 6, 2015

The SEC charged 12 companies and six individuals with defrauding investors in a scheme involving applications to the Federal Communications Commission (FCC) for cellular spectrum licenses.  According to the SEC’s complaint, David Alcorn and Kent Maerki orchestrated the offering fraud through their Arizona-based company Janus Spectrum LLC. and raised more than $12.4 million, much of which they and their co-conspirators kept for personal use.  Those alleged to be involved in the scheme include Daryl G. Bank and his companies Dominion Private Client Group LLC, Janus Spectrum Group LLC, Spectrum Management LLC, Spectrum 100 LLC, Spectrum 100 Management LLC, Prime Spectrum LLC and Prime Spectrum Management LLC; Bobby D. Jones and his company Premier Spectrum Group PMA; Terry W. Johnson and Raymon G. Chadwick Jr. and their companies Innovative Group PMA, Premier Group PMA and Prosperity Group PMA.  SECv

April 2, 2015

The SEC charged two longtime friends, Amit Kanodia and Iftikar Ahmed, with insider trading on news of a proposed acquisition of Cooper Tire and Rubber Company by Apollo Tyres Ltd.  The SEC also named Rakitfi Holdings LLC, a company owned by Ahmed, and Lincoln Charitable Foundation, a supposed charity operated by Kanodia, as relief defendants.  SEC

April 1, 2015

Timothy Scronce agreed to settle charges of defrauding Illinois-based telecommunications company PCTEL Inc. and its shareholders during and after its acquisition of his business TelWorx Communications LLC and his three related telecommunications companies.  According to the SEC, Scronce used false accounting entries to inflate TelWorx’s quarterly revenues and earnings in the months leading up to the purchase to inflate the price PCTEL paid for the companies.  He also allegedly falsified PCTEL’s books and records and circumvented the company’s internal controls by recording bogus transactions.  Scronce consented to the SEC’s order requiring him to return his allegedly ill-gotten gains with interest, pay a civil penalty, and be barred for 10 years from serving as a public company officer or director.  SEC

March 31, 2015

The SEC charged Andrew Miller, the former CEO of Silicon Valley-based technology firm Polycom Inc., with using nearly $200,000 in corporate funds for personal perks that were not disclosed to investors.  The SEC separately charged Polycom in an administrative order finding the company had inadequate internal controls and failed to report Miller’s perks to investors.  Polycom agreed to pay $750,000 to settle the SEC’s charges.  SEC

March 30, 2015

The SEC announced fraud charges against investment adviser Lynn Tilton and her New York-based Patriarch Partners firms accusing them of hiding the poor performance of loan assets in three collateralized loan obligation (CLO) funds they manage collectively referred to as the Zohar funds.  SEC

March 27, 2015

New York-based brokerage firm Macquarie Capital (USA) Inc., a wholly owned subsidiary of global financial services firm Macquarie Group Limited, agreed to pay $15 million to settle SEC charges for underwriting a public offering o Puda Coal despite obtaining a due diligence report indicating that the China-based company’s offering materials contained false information.  Former Macquarie Capital managing director Aaron Black and former investment banker William Fang also agreed to pay $212,711 and $35,000, respectively, to settle charges they failed to exercise appropriate care in their due diligence review.  SEC