The SEC announced today that on August 28, 2018, the Honorable John Z. Lee of the United States District Court for the Northern District of Illinois entered a partial judgment against defendants Jerome Cohen and Shaun Cohen.

The partial judgment imposes a permanent injunction against future violations by Jerome Cohen and Shaun Cohen of the antifraud provisions of Section 17(a) of the Securities Act of 1933, and Section 10(b)(5) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and the registration provisions of Sections 5(a) and 5(c) of the Securities Act. The partial judgment also prohibits Jerome and Shaun Cohen from soliciting any new investors for the remaining duration of the litigation.

Jerome and Shaun Cohen also consented to the previously entered order appointing a receiver to continue until the final disposition of the case. Kevin B. Duff, of the law firm Rachlis Duff Adler Peel & Kaplan, LLC, has been appointed as a receiver over defendants Equitybuild, Inc., Equitybuild Finance, LLC as well as a number of other related entities. He has been directed by the Court to secure real estate and other assets obtained with investor funds for the benefit of defrauded investors.

Under the partial judgment, the amount of disgorgement, prejudgment interest, and civil penalties to be imposed against the defendants will be decided by the Court at a later time. For the purposes of determining the amount of disgorgement, prejudgment interest, and civil penalties, Jerome and Shaun Cohen will not contest the facts alleged in the SEC's complaint.

The SEC's complaint, which was filed on August 15, 2018, alleged that the defendants sold at least $135 million in unregistered promissory notes to at least 900 investors throughout the country.

The SEC's investigation, which is continuing, was conducted by Timothy Stockwell, Ariella Guardi, and Ann Tushaus and supervised by C.J. Kerstetter. The SEC's litigation is being led by Benjamin Hanauer.