August 11, 2011
The SEC charged Toby G. Scammell with making illegal profits of over $192,000 from insider trading after he learned from his girlfriend about the impending acquisition of Marvel Entertainment, Inc. by the Walt Disney Company.
August 5, 2011
The SEC upheld an administrative law judge's determination that Robert L. Burns, a former equity trader at FMR Co., Inc., a registered investment adviser, had willfully violated Section 17(e)(1) of the Investment Company Act of 1940 by accepting compensation from brokerage firms to which he transmitted orders to buy and sell securities on behalf of certain mutual funds that were advisory clients of FMR. The SEC found that, from 2002 through 2004, Burns sent securities transactions involving more than 2 billion shares to ten firms from which he accepted at least thirty-nine gifts, including wine, travel, and tickets to various concerts, sporting events, and theater productions. For his violations, the SEC sustained the law judge's decision censuring Burns and ordering him to cease and desist from committing future violations. The SEC also ordered Burns to disgorge $141,822.50 and imposed a civil penalty of $40,000.
August 4, 2011
The SEC brought an administrative action against Patrick L. Martin, the former chief manager of LandOak Securities, LLC, an investment adviser registered with the SEC, since April 2000. LandOak Securities is also a broker-dealer registered with the SEC. Martin is currently the sole owner and principal operator of LandOak Securities and has owned at least 75% of it since April 2003. Prior to that time, Martin owned at least 25% of LandOak Securities. Martin has been a registered representative of LandOak Securities, the registered broker-dealer, from April 1996 to the present.
August 2, 2011
The SEC brought an administrative action against Brian A. Bjork, the Estate of Joel David Salinas, various related entities (Select Capital), Select Asset Fund I, LLC, and Select Asset Prime Index Fund, LLC, alleging that from 2004 through the present, Bjork offered securities in two fraudulent securities schemes, raising a total of $52 million.
July 28, 2011
The SEC brought an administrative action against Benchmark Asset Managers LLC, a registered investment adviser owned by Otto Sam Folin, and Harvest Managers, LLC. The SEC found that Benchmark and Folin provided investment advice to clients for compensation, raised money from investors and advisory clients by offering and selling a variety of securities and managed and advised a group of hedge funds known as the Safe Haven Investment Portfolios LLC.
July 26, 2011
The SEC brought an administrative action under the Securities Exchange Act of 1934 and Investment Advisers against William K. Harrison, who was associated with Wachovia Securities, Inc. as a registered representative from 2003 until October 13, 2008. The SEC found that between approximately December 2007 and October 2008, Harrison used misrepresentations and omissions of material fact to defraud at least forty-two Wachovia brokerage customers of at least $8 million in customer funds. On or around December 2007, Harrison began offering his Wachovia customers an investment opportunity outside of Wachovia through an advisory firm he owned.
July 15, 2011
The United States District Court for the Southern District of New York entered a Final Judgment as to Daniel L. DeVore (“DeVore”) in the SEC’s insider trading case against two expert network employees and four consultants charged with insider trading for illegally tipping hedge funds and other investors.
July 15, 2011
The SEC announced that the Honorable Jed S. Rakoff, United States District Judge, United States District Court for the Southern District of New York, entered a Final Judgment as to Danielle Chiesi on July 12, 2011, in the SEC’s insider trading case against Raj Rajaratnam, Galleon Management, LP, Danielle Chiesi (“Chiesi”) and others, alleging a widespread insider trading scheme involving hedge funds, industry professionals, and corporate insiders.
July 12, 2011
The SEC charged Sam Otto Folin (“Folin”), Benchmark Asset Managers LLC (“Benchmark”) and Benchmark’s parent company, Harvest Managers LLC (“Harvest”), with misappropriating approximately $8.7 million from advisory clients, friends and family through material misrepresentations and omissions. Folin and Benchmark are based in Philadelphia, Pennsylvania.
July 11, 2011
SEC Brings Enforcement Action Against Janney Montgomery Scott for Inadequate Insider Trading Compliance Program
The SEC brought and settled charges against Janney Montgomery Scott LLC (Janney), a Philadelphia-based broker-dealer, for failing to establish and enforce policies and procedures to prevent the misuse of material, nonpublic information. Janney agreed to be censured and to pay an $850,000 penalty to settle the SEC’s administrative proceeding.