Thomas T. Prousalis, Jr. and Robert T. Kirk, Jr.

U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 19150 / March 22, 2005

Securities and Exchange Commission v. Thomas T. Prousalis, Jr. and Robert T. Kirk, Jr., No. 04 Civ. 0081 (S.D.N.Y.) (GEL)

COURT ENJOINS WASHINGTON DC ATTORNEY THOMAS PROUSALIS AND UNDERWRITER PRESIDENT ROBERT KIRK IN BUSYBOX FRAUD; ORDERS PAYMENT OF $4.9 MILLION IN PENALTIES, DISGORGEMENT AND INTEREST

The Securities and Exchange Commission today announced that on March 21, 2005, the Honorable Gerald Lynch of the United States District Court for the Southern District of New York entered Final Judgments against Thomas Prousalis and Robert Kirk in the Commission's enforcement action arising out of the fraudulent initial public offering for the stock of busybox.com, Inc. The Court granted the Commission's motion for summary judgment against Prousalis, enjoined him from future violations of the antifraud provisions of the securities laws, and ordered him to disgorge his ill-gotten legal fee of $1.25 million, pay prejudgment interest of $406,131, and pay a penalty of $1.25 million. Prousalis, age 57, was an attorney licensed to practice in Washington, DC, and is now serving a 57 month sentence in federal prison following his guilty plea to related criminal charges. Kirk consented, without admitting or denying the allegations in the Commission's complaint, to similar injunctive relief and an order to disgorge his underwriter's fee of $1.5 million and pay prejudgment interest of $497,304. Kirk, age 47, was the president and majority owner of Barron Chase Securities, Inc., the lead managing underwriter for the busybox IPO, and he was recently sentenced to 37 months in federal prison for his role in the busybox scheme. The Commission's complaint had charged that, when Barron Chase was unable to sell all of the busybox IPO to bona fide investors, Prousalis and Kirk devised a scheme for Prousalis and company insiders secretly to buy the unsold IPO stock, and then secretly get repaid out of the IPO proceeds, shortchanging the company and its IPO investors out of more than $2 million (Lit. Rel. No. 18533, Jan. 7, 2004).

In a related action, the Commission also announced the issuance of a Commission order barring Kirk by consent from association with any broker or dealer. (Exch. Act. Rel. No. 34-51408, March 22, 2005). Previously, the Commission had barred Prousalis forthwith from practicing before the Commission as an attorney. (Exch. Act. Rel. No. 50986, Jan. 7, 2005). The Commission acknowledges the assistance of the office of the U.S. Attorney for the Southern District of New York in this matter.