On July 30, 2020, the U.S. District Court for the District of Columbia entered a final judgment against Niel Martin Nielson, a London-based microcap executive who was previously charged by the SEC with defrauding retail investors in a penny stock scheme. The SEC's complaint, filed on May 24, 2018, charged Nielson, the CEO of E-Waste Systems, Inc., an Ohio-based electronic waste recycling company, with orchestrating a scheme to artificially increase the company's share price and volume. Nielson allegedly entered into a series of sham contracts, made materially false and misleading statements, and booked false revenue to create the impression that E-Waste was rapidly expanding across the United States, Europe, and Asia, when it in fact had virtually no operations.

The judgment, entered on the basis of default, determined that Nielson violated, and permanently enjoins him from violating, the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, the books and records provisions of Section 13(b)(5) of the Exchange Act and Rules 13b2-1 and 13b2-2 thereunder, the certification provision of Rule 13a-14 of the Exchange Act, and the ownership reporting provision of 16(a) of the Exchange Act and Rule 16a-3 thereunder. The judgment also determined that Nielson aided and abetted E-Waste's violations of the reporting provisions of Sections 13(a) and 13(b)(2)(A) of the Exchange Act and Rules 12b-20, 13a-1, 13a-11, and 13a-13 thereunder, and permanently enjoins him from aiding and abetting violations of these provisions by others. The judgment imposes a 10-year officer-and-director bar and a 10-year penny-stock bar, and prohibits Nielson from directly or indirectly accepting compensation for consulting for or advising any penny-stock issuer. Nielson is ordered to pay disgorgement of $170,630 plus prejudgment interest and a civil penalty of $170,630.

The SEC's litigation was led by Suzanne J. Romajas, with assistance by Virginia Rosado Desilets and Sonia Torrico, and supervised by Jan M. Folena.