This is a photo of the National Register of Historic Places listing with reference number 7000063
Wednesday, August 29, 2012
CONVICTED PONZI SCHEMER ORDERED TO PAY OVER $18,000,000
FROM: U.S. SECURITIES AND EXCHANGE COMMISSIONThe Securities and Exchange Commission announced today that the United States District Court for the District of Utah entered a final judgment against Jeffrey L. Mowen, ordering Mowen to disgorge $8,041,779 in ill-gotten gains and $1,964,203.67 in prejudgment interest. The Court also ordered Mowen to pay a civil penalty of $8,041,779, for a total of $18,047,761.67. The Court further enjoined Mowen from future violations of Section 10(b) of the Securities Exchange Act of 1934, Rule 10b-5 thereunder, and Section 17(a) of the Securities Act of 1933.
The SEC Complaint alleged that Mowen operated a Ponzi scheme that was fed through investor funds raised by another defendant, Thomas Fry. Fry, in turn, raised funds through other defendants, Fry’s promoters, via the unregistered offer and sale of high-yield promissory notes. According to the Complaint, the scheme raised over $40 million from over 150 investors in several states, over $18 million of which was funneled to Mowen. Mowen never invested the funds, instead misappropriating over $8 million to support a lavish lifestyle.
On May 4, 2011, Mowen pled guilty to committing wire fraud in a related criminal action and is currently serving a ten year prison sentence. United States of America v. Mowen, Case No. 2:09-cr-00098-DB (D. Utah).
A final judgment ordering disgorgement and penalties against Fry and several of his promoters was entered on June 15, 2012.
The SEC Complaint alleged that Mowen operated a Ponzi scheme that was fed through investor funds raised by another defendant, Thomas Fry. Fry, in turn, raised funds through other defendants, Fry’s promoters, via the unregistered offer and sale of high-yield promissory notes. According to the Complaint, the scheme raised over $40 million from over 150 investors in several states, over $18 million of which was funneled to Mowen. Mowen never invested the funds, instead misappropriating over $8 million to support a lavish lifestyle.
On May 4, 2011, Mowen pled guilty to committing wire fraud in a related criminal action and is currently serving a ten year prison sentence. United States of America v. Mowen, Case No. 2:09-cr-00098-DB (D. Utah).
A final judgment ordering disgorgement and penalties against Fry and several of his promoters was entered on June 15, 2012.
Monday, August 27, 2012
ALLEGED INSIDER TRADING USING NONPUBLIC INFORMATION
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION,
SEC Charges Eric Martin, former Vice President of Investor Relations of Carter’s Inc. with Insider Trading
On August 23, 2012, the Securities and Exchange Commission filed a civil injunctive action against Eric Martin, a 42 year old resident of Roswell, Georgia. The Commission alleges that Martin, who served from 2003 through March 2009 as the Director and, later, Vice President of Investor Relations for Carter’s Inc., repeatedly traded Carter’s shares during blackout periods while in possession of material, nonpublic information regarding the company’s financial results. According to the complaint, Martin obtained Carter’s preliminary financial results while preparing Carter’s senior management for Carter’s quarterly earnings calls, and then bought or sold Carter’s stock depending on whether the preliminary information here received was positive or negative. As the result of his illegal trading, Martin realized profits and avoided losses in excess of $170,000.
The Commission’s complaint, filed in the United States District Court for the Northern District of Georgia, charges Martin with violating the antifraud provisions of the federal securities laws during at least 8 quarters between January 2007 and April 2009 in advance of the company’s quarterly earnings releases. The Commission seeks a permanent injunction, disgorgement with prejudgment interest and civil monetary penalties Act against Defendant Martin and seeks disgorgement with prejudgment interest from his wife, Relief Defendant Robin Martin, for trading Martin did through her accounts.
Sunday, August 26, 2012
CFTC CHARGES INDIVIDUAL AND COMPANY WITH RUNNING FRAUDULENT ALLOCATION SCHEME
FROM: U.S. COMMODITY AND EXCHANGE COMMISSION
CFTC Charges Illinois Resident Donald A. Newell and his Company, Quiddity, LLC, with Running a Fraudulent Allocation Scheme, Making Material False Statements to the CFTC, and Recordkeeping Violations
Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today filed a federal civil enforcement action charging defendants Donald A. Newell of Glenview, Ill., and his Chicago-based company, Quiddity, LLC, with engaging in a scheme that fraudulently allocated commodity futures and options trades to benefit a corporate proprietary account, at the expense of customer accounts managed and traded by Quiddity. Newell owns and controls Quiddity and is a registered Associated Person of Quiddity, which is a registered Commodity Pool Operator and Commodity Trading Advisor.
The CFTC complaint, filed in the U.S. District Court for the Northern District of Illinois, alleges that since at least October 15, 2008, and continuing through at least March 19, 2009, Newell’s fraudulent scheme to allocate profitable trades to his corporate proprietary account resulted in a net profit of over $1.1 million for the proprietary account to the detriment of Quiddity’s customers. The complaint also alleges that Newell and Quiddity failed to keep required records and that Newell made material false statements to the CFTC during investigative testimony in September and October of 2011.
Specifically, the complaint alleges that Quiddity, through Newell, entered orders for trades with Futures Commission Merchants without providing the specific account numbers to which the executed trades were to be allocated. Defendants allegedly waited to see whether the trades were profitable or if the market had moved favorably to an open position before allocating the trades. During the period, 85 percent of the trades that defendants allegedly allocated to their proprietary account post-execution were profitable. Newell falsely testified to the CFTC that he provided account numbers when placing orders, according to the complaint.
The defendants also allegedly failed to retain records sufficient to demonstrate that allocations of trades were fair and equitable, and to permit the reconstruction of the handling of the order from the time of placement by the account manager to the allocation to individual accounts, as required by CFTC regulations.
In its continuing litigation, the CFTC seeks restitution to defrauded customers, a return of ill-gotten gains, civil monetary penalties, trading and registration bans, and permanent injunctions against further violations of federal commodities laws.
The CFTC appreciates the assistance of the National Futures Association.
CFTC Division of Enforcement staff members responsible for this case are Boaz Green, Brandon Tasco, Melanie Bates, Beth Meyer, Susan B. Padove, Michael Solinsky, Gretchen L. Lowe, and Vincent A. McGonagle.
CFTC Charges Illinois Resident Donald A. Newell and his Company, Quiddity, LLC, with Running a Fraudulent Allocation Scheme, Making Material False Statements to the CFTC, and Recordkeeping Violations
Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today filed a federal civil enforcement action charging defendants Donald A. Newell of Glenview, Ill., and his Chicago-based company, Quiddity, LLC, with engaging in a scheme that fraudulently allocated commodity futures and options trades to benefit a corporate proprietary account, at the expense of customer accounts managed and traded by Quiddity. Newell owns and controls Quiddity and is a registered Associated Person of Quiddity, which is a registered Commodity Pool Operator and Commodity Trading Advisor.
The CFTC complaint, filed in the U.S. District Court for the Northern District of Illinois, alleges that since at least October 15, 2008, and continuing through at least March 19, 2009, Newell’s fraudulent scheme to allocate profitable trades to his corporate proprietary account resulted in a net profit of over $1.1 million for the proprietary account to the detriment of Quiddity’s customers. The complaint also alleges that Newell and Quiddity failed to keep required records and that Newell made material false statements to the CFTC during investigative testimony in September and October of 2011.
Specifically, the complaint alleges that Quiddity, through Newell, entered orders for trades with Futures Commission Merchants without providing the specific account numbers to which the executed trades were to be allocated. Defendants allegedly waited to see whether the trades were profitable or if the market had moved favorably to an open position before allocating the trades. During the period, 85 percent of the trades that defendants allegedly allocated to their proprietary account post-execution were profitable. Newell falsely testified to the CFTC that he provided account numbers when placing orders, according to the complaint.
The defendants also allegedly failed to retain records sufficient to demonstrate that allocations of trades were fair and equitable, and to permit the reconstruction of the handling of the order from the time of placement by the account manager to the allocation to individual accounts, as required by CFTC regulations.
In its continuing litigation, the CFTC seeks restitution to defrauded customers, a return of ill-gotten gains, civil monetary penalties, trading and registration bans, and permanent injunctions against further violations of federal commodities laws.
The CFTC appreciates the assistance of the National Futures Association.
CFTC Division of Enforcement staff members responsible for this case are Boaz Green, Brandon Tasco, Melanie Bates, Beth Meyer, Susan B. Padove, Michael Solinsky, Gretchen L. Lowe, and Vincent A. McGonagle.
Saturday, August 25, 2012
NEW SEC RULES ON RESOURCE EXTRACTION PAYMENT DISCLOSURE
FROM: U.S. DEPARTMENT OF LABOR
FACT SHEET
Disclosing Payments by Issuers Engaged in Resource Extraction
Background
In 2010, Congress passed the Dodd-Frank Act, which directs the Commission to issue rules requiring the disclosure of certain payments made to the federal government or foreign governments by resource extraction issuers – companies engaged in the development of oil, natural gas, or minerals.
In particular, Section 1504 of the Act amends the Securities Exchange Act of 1934 by adding a new section, Section 13(q).
The new rules require a resource extraction issuer to disclose payments made to governments if:
The new disclosure requirements apply to domestic and foreign issuers and to smaller reporting companies that meet the definition of resource extraction issuer.
In addition, the issuer is required to disclose payments made by a subsidiary or another entity controlled by the issuer. A resource extraction issuer needs to make a factual determination as to whether it has control of an entity based on a consideration of all relevant facts and circumstances.
Under the new rules, a resource extraction issuer is required to disclose certain payments made to a foreign government (including subnational governments) or the U.S. government.
Resource extraction issuers need to disclose payments that are:
The rules define commercial development of oil, natural gas, or minerals to include exploration, extraction, processing, and export, or the acquisition of a license for any such activity. The rules define “not de minimis” to mean any payment (whether a single payment or a series of related payments) that equals or exceeds $100,000 during the most recent fiscal year.
The types of payments related to commercial development activities that need to be disclosed include:
The new requirements clarify the types of taxes, fees, bonuses, and dividends that are required to be disclosed. These types of payments generally are consistent with the types of payments that the Extractive Industries Transparency Initiative suggests should be disclosed. Congress specifically referenced the EITI in defining “payment” in the law.
The rules require a resource extraction issuer to provide the following information about payments made to further the commercial development of oil, natural gas, or minerals:
The new rules leave the term “project” undefined to provide resource extraction issuers flexibility in applying the term to different business contexts. However, the rule release provides some guidance on the Commission’s view of what a project would be.
The new rules require a resource extraction issuer to disclose the information annually by filing a new form with the SEC (Form SD). The information must be included in an exhibit and electronically tagged using the eXtensible Business Reporting Language (XBRL) format.
A resource extraction issuer would be required to file the form on the SEC public database EDGAR no later than 150 days after the end of its fiscal year.
A resource extraction issuer would be required to comply with the new rules for fiscal years ending after Sept. 30, 2013. For the first report, most resource extraction issuers may provide a partial report disclosing only those payments made after Sept. 30, 2013.
FACT SHEET
Disclosing Payments by Issuers Engaged in Resource Extraction
Background
In 2010, Congress passed the Dodd-Frank Act, which directs the Commission to issue rules requiring the disclosure of certain payments made to the federal government or foreign governments by resource extraction issuers – companies engaged in the development of oil, natural gas, or minerals.
In particular, Section 1504 of the Act amends the Securities Exchange Act of 1934 by adding a new section, Section 13(q).
The Rules
Who Must Disclose:The new rules require a resource extraction issuer to disclose payments made to governments if:
- The issuer is required to file an annual report with the SEC.
- The issuer engages in the commercial development of oil, natural gas, or minerals.
The new disclosure requirements apply to domestic and foreign issuers and to smaller reporting companies that meet the definition of resource extraction issuer.
In addition, the issuer is required to disclose payments made by a subsidiary or another entity controlled by the issuer. A resource extraction issuer needs to make a factual determination as to whether it has control of an entity based on a consideration of all relevant facts and circumstances.
What Must Be Disclosed:
Under the new rules, a resource extraction issuer is required to disclose certain payments made to a foreign government (including subnational governments) or the U.S. government.
Resource extraction issuers need to disclose payments that are:
- Made to further the commercial development of oil, natural gas, or minerals.
- “not de minimis”
- Within the types of payments specified in the rules.
The rules define commercial development of oil, natural gas, or minerals to include exploration, extraction, processing, and export, or the acquisition of a license for any such activity. The rules define “not de minimis” to mean any payment (whether a single payment or a series of related payments) that equals or exceeds $100,000 during the most recent fiscal year.
The types of payments related to commercial development activities that need to be disclosed include:
- Taxes
- Royalties
- Fees (including license fees)
- Production Entitlements
- Bonuses
- Dividends
- Infrastructure Improvements
The new requirements clarify the types of taxes, fees, bonuses, and dividends that are required to be disclosed. These types of payments generally are consistent with the types of payments that the Extractive Industries Transparency Initiative suggests should be disclosed. Congress specifically referenced the EITI in defining “payment” in the law.
The rules require a resource extraction issuer to provide the following information about payments made to further the commercial development of oil, natural gas, or minerals:
- Type and total amount of payments made for each project.
- Type and total amount of payments made to each government.
- Total amounts of the payments, by category.
- Currency used to make the payments.
- Financial period in which the payments were made.
- Business segment of the resource extraction issuer that made the payments.
- The government that received the payments, and the country in which the government is located.
- The project of the resource extraction issuer to which the payments relate.
The new rules leave the term “project” undefined to provide resource extraction issuers flexibility in applying the term to different business contexts. However, the rule release provides some guidance on the Commission’s view of what a project would be.
How It Must Be Disclosed:
The new rules require a resource extraction issuer to disclose the information annually by filing a new form with the SEC (Form SD). The information must be included in an exhibit and electronically tagged using the eXtensible Business Reporting Language (XBRL) format.
When It Must Be Disclosed:
A resource extraction issuer would be required to file the form on the SEC public database EDGAR no later than 150 days after the end of its fiscal year.
A resource extraction issuer would be required to comply with the new rules for fiscal years ending after Sept. 30, 2013. For the first report, most resource extraction issuers may provide a partial report disclosing only those payments made after Sept. 30, 2013.
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