RichMark Capital Corporation and Doyle Mark White

SECURITIES EXCHANGE ACT OF 1933
Rel. No. 8333 / November 7, 2003

SECURITIES EXCHANGE ACT OF 1934
Rel. No. 48757 / November 7, 2003

Admin. Proc. File No. 3-9954

In the Matter of RICHMARK CAPITAL CORPORATION 5525 North MacArthur Boulevard Irving, Texas 75038 and DOYLE MARK WHITE

ORDER IMPOSING REMEDIAL SANCTIONS

On the basis of the Commission's opinion issued this day, it is

ORDERED that the registration of RichMark Capital Corporation as a broker and dealer be, and it hereby is, suspended for a period of 90 days, effective at the opening of business on November 24, 2003; and it is further

ORDERED that Doyle Mark White be, and he hereby is, suspended from association with any broker or dealer for a period of 90 days, effective at the opening of business on November 24, 2003; and it is further

ORDERED that RichMark pay a civil money penalty of $275,000 and White a civil money penalty of $55,000; and it is further

ORDERED that RichMark and White cease and desist from committing or causing any violations or future violations of Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act and Rule 10b-5 thereunder; and it is further

ORDERED that RichMark and White jointly and severally disgorge $25,617.86, and pay prejudgment interest as described in 17 C.F.R. § 201.600, with the adjustment noted in the Commission's opinion.

RichMark and White's payments of the civil money penalties and joint and several disgorgement shall be: (i) made by United States postal money order, certified check, bank cashier's check, or bank money order; (ii) made payable to the Securities and Exchange Commission; (iii) delivered by hand or courier to the Office of Financial Management, Securities and Exchange Commission, Operations Center, 6432 General Green Way, Stop 0-3, Alexandria, Virginia 22312 within thirty days of the date of this order; and (iv) submitted under cover letter which identifies RichMark and White as the respondents in Administrative Proceeding No. 3-9954. A copy of this cover letter and check shall be sent to Jeffrey B. Norris, Counsel for the Division of Enforcement, Securities and Exchange Commission, 801 Cherry Street, Fort Worth, Texas 76102; and it is further

ORDERED that, within sixty (60) days after payment of funds or other assets in accordance with the disgorgement required by this Order, the Division of Enforcement shall submit a proposed plan for the administration and distribution of disgorgement funds in accordance with Rule 610 of our Rules of Practice.

By the Commission.

Endnotes

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1 15 U.S.C. § 77q(a)(1).

2 15 U.S.C. § 78j(b).

3 17 C.F.R. § 240.10b-5.

4 15 U.S.C. § 77q(a)(2).

5 15 U.S.C. § 77q(a)(3).

6 Although the order instituting these proceedings made broader charges of deficient disclosure, the law judge based his findings of violation in this respect on Respondents' failure to make adequate disclosure in or with the PCCG corporate profile. The Division of Enforcement did not appeal that determination.

7 Rule 451(d) of the Commission's Rules of Practice permits a member of the Commission who was not present at oral argument to participate in the decision of that proceeding if that member has reviewed the transcript of that argument prior to such participation. Here, the required review has been made.

8 RichMark was given the option to buy 50,000 PCCG shares at $3.50 upon the funding of a secured line of credit or other financing facility, and the option to purchase 100,000 shares at $4.50 when PCCG stock was listed on the Philadelphia or another exchange. These goals were neverachieved.

9 The sales were effected through an RMC account opened at FSW.

10 See Chasins v. Smith Barney & Co., Inc., 438 F.2d 1167, 1172 (2d Cir. 1970) ("The investor . . . must be permitted to evaluate overlapping motivations through appropriate disclosures, especially where one motivation is economic self-interest"). See also Gilbert A. Zwetsch, 50 S.E.C. 816, 818-819 (1991); Paulson Investment Company, Inc., 47 S.E.C. 886, 888 (1983).

11 Even assuming that RichMark were a representative of FSW (which it was not), the disclosure on the back of customer confirmations was inadequate. While "generic" disclosure of this type might be appropriate in some circumstances, it was clearly inadequate in the case of a firm like RichMark that was conducting a sales campaign in a single security.

12 The law judge twice stated that Respondents acted with "an intent to deceive and defraud," but also stated that they acted "recklessly." While we are inclined to agree with the initial formulation, we conclude that Respondents' conduct was at least reckless.

13 SEC v. Capital Gains Research Bureau, Inc., 375 U.S. 180, 186 (1963).

14 Basic Inc. v. Levinson, 485 U.S. 224, 231-232 (1988) (quoting TSC Industries, Inc. v. Northway, Inc., 426 U.S. 438, 449 (1976).

15 See U.S. v. Eisenberg, 773 F. Supp. 662, 723 (D.N.J. 1991).

16 TSC Industries, Inc. v. Northway, Inc., supra, 426 U.S. at 445. SEC v. Hasho, 784 F. Supp. 1059, 1108 (S.D.N.Y. 1982) (expectations of individual investors are not relevant).

17 Respondents also note the testimony of a third customer, who testified on their behalf. This customer was a longtime acquaintance and client of White whom White contacted personally. When asked if he considered himself "an ordinary retail customer of RichMark," the customer replied that he really didn't know. The fourth "customer" noted by Respondents was White's lawyer.

18 In support of their claim that the profile was not a recommendation, Respondents cite certain Commission releases dealing with suitability requirements. However, those releases are inapposite and do not support Respondents' contention. Respondents' distribution of the PCCG corporate profile was not simply the general mailing of a research report that, viewed in isolation, might not in and of itself constitute a recommendation. Instead, the profile was part and parcel of Respondents' PCCG sales campaign.

19 17 C.F.R. § 240.10b-10.

20 15 U.S.C. § 77q(b).

21 Ettinger v. Merrill Lynch Pierce, Fenner & Smith, Inc., 835 F.2d 1031, 1036 (3d Cir. 1987); Krome v. Merrill Lynch & Co., Inc., 637 F. Supp. 910, 916 (S.D.N.Y. 1986).

22 According to Respondents, the IBA was also mentioned in a televised CNBC story on PCCG. The record contains no details concerning this story.

23 We do not credit the claim of White and Monello that the letter was also sent to all RichMark clients. The letter was addressed to "Dear Shareholder," and the invoice from RichMark to PCCG seeking reimbursement for RichMark's outlay describes the item in question as a "2000 piece mail-out to shareholders."

24 See United Paperworkers International Union v. International Paper Company ("United Paperworkers"), 985 F.2d 1190, 1199 (2d Cir. 1993) ("[T]he mere presence in the media of sporadic news reports" does not make them part of the "total mix" of available information). See also Fisher v. The Plessey Company, Ltd., 559 F. Supp. 442, 446 (S.D.N.Y. 1983) ("Of paramount importance . . . is the direct availability to the investors of the information in question.").

25 See United Paperworkers, supra (Merely filing a document with a regulatory agency does not place the document in the"total mix" of information reasonably available to investors. "[T]he Company's 10-K Report [was not] part of the reasonably available mix. That report was filed with the SEC, not distributed to shareholders. Nothing in any of the documents sent to shareholders highlighted the 10-K Report.").

26 See Koppel v. 4987 Corp., 167 F.3d 125, 131-132 (2d Cir. 1999); Klein v. PDG Remediation, Inc., 937 F. Supp. 323, 327-328 (S.D.N.Y. 1996); Fisher v. The Plessey Co., Ltd., supra, 559 F. Supp. at 445-448.

27 When the legend appeared on a customer confirmation, it also appeared on the customer's monthly account statement.

28 The Division of Enforcement did not appeal the law judge's conclusion.

29 See, e.g., Legg Mason Wood Walker, Incorporated, Exchange Act Rel. No. 44407 (June 11, 2001), 75 SEC Docket 537, 539 n.3.

30 Feeley & Willcox Asset Management Corp., Securities Act Rel. No. 8249 (July 10, 2003), 80 SEC Docket 2075.

31 See, e.g., John Montelbano, Exchange Act Release No. 47227 (January 22, 2003), 79 SEC Docket 1474, 1497, and the authorities there cited.

32 We grant the Division's motion to adduce additional evidence which reflects that, in 2002, pursuant to an NASD settlement, RichMark was censured and fined $15,000 based on charges that its Bellevue, Washington branch office disseminated false and misleading information about the office's past performance and services through certain websites.

33 Section 21B of the Exchange Act, 15 U.S.C. § 78u-2.

34 KPMG Peat Marwick LLP, Exchange Act Rel. No. 43862 (January 19, 2001), 74 SEC Docket 384, 429-430, aff'd, 289 F.3d 109 (D.C. Cir. 2002).

35 L.C. Wegard & Co., Inc., 53 S.E.C. 607, 617 (1998), aff'd, 189 F.3d 461 (2d Cir. 1999) (Table). See also SEC v. Hughes Cap. Corp., 917 F. Supp. 1080, 1086, 1087 (D.N.J. 1996) (refusing to offset disgorgement by "certain 'legitimate' business expenses [and noting that] the overwhelming weight of authority holds that securities law violators may not offset their disgorgement liability with business expenses"), aff'd, 124 F.3d 449 (3d Cir. 1997); SEC v. Great Lakes Equities Co., 775 F. Supp. 211, 214-215 and n.22 (E.D. Mich. 1991) (declining to reduce disgorgement amount by"overhead, commissions and other expenses"), aff'd without opinion, 12 F.3d 214 (6th Cir. 1993); SEC v. World Gambling Corp., 555 F. Supp. 930, 935 (S.D.N.Y. 1983) (declining to reduce disgorgement amount although it might have been "slightly overstated by overhead and income taxes"), aff'd, 742 F.2d 1440 (2d Cir. 1983) (Table).

36 We do not deem it appropriate to make a similar adjustment, as requested by Respondents, for the period of another adjournment that was granted because of the unavailability of a hearing room and the parties' desire to engage in additional settlement discussions.

37 We have considered all of the arguments advanced by the parties. We have rejected or accepted them to the extent that they are inconsistent or in accord with the views expressed herein.