SEC News Digest

ENFORCEMENT PROCEEDINGS

Commission Issues Cease-and-Desist Order Against Future Reporting Violations By Xstream Mobile Solutions Corp., and Dismisses Pending Administrative Proceeding Against the Issuer.

On August 18, the Commission issued an Order Instituting Cease-and-Desist Proceedings, Making Findings, and Imposing a Cease-and-Desist Order Pursuant to Section 21C of the Securities Exchange Act of 1934 against Xstream Mobile Solutions Corp. as a result of its failure, over a period of more than two years, to file timely quarterly and annual reports as required by Section 13(a) of the Exchange Act and rules thereunder.

Also on August 18, the Commission dismissed with prejudice pending administrative proceedings instituted against Xstream pursuant to Exchange Act Section 12(j) to determine whether it was necessary and appropriate for the protection of investors to suspend or revoke the registration of Xstream's securities. In the Matter of Xino Corp. (n/k/a Asher Xino Corp.), Administrative Proceeding File No. 3-13428, April 3, 2009. (Rel. 34-60523; File No. 3-13583)

In the Matter of Jaycee James

The Securities and Exchange Commission issused an Order Instituting Cease-and-Desist Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934 against JayCee James, a resident of Victorville, Ca.

The Division of Enforcement alleges in the Order that from March 6, 2009 through May 6, 2009, JayCee James filed with the Commission 83 Forms 3 and 4 and Schedules 13D and 13D/A. In these filings, James claims stock ownership in 29 different companies. The Division also alleges that contrary to James' representations made in his filings, he is not a shareholder of any of the companies in which he claimed stock ownership. The Division further alleges that as a result of the conduct described above, James violated Sections 13(d) and 16(a) of the Securities Exchange Act of 1934 and Rules 13d-1, 13d-2, and 16a-3 thereunder.

A hearing will be scheduled before an Administrative Law Judge to determine whether the allegations contained in the Order are true, and whether James should be ordered to cease and desist from committing or causing any violations and any future violations of Sections 13(d) and 16(a) of the Exchange Act and Rules 13d-1, 13d-2, and 16a-3 thereunder. The Order requires the Administrative Law Judge to issue an initial decision no later than 300 days from the date of service of this Order, pursuant to Rule 360(a)(2) of the Commission's Rules of Practice. (Rel. 34-60529; File No. 3-13584)

Revocation of Registration of Securities of Entrade, Inc. and Cease-and-Desist Order

On August 19, pursuant to Section 12(j) of the Securities and Exchange Act of 1934, the Commission revoked the registration of the securities of Entrade, Inc. of Chicago, Ill., registered with the Commission pursuant to Section 12 of the Exchange Act.

In its Order revoking the registration of securities of Entrade, Inc. registered with the Commission pursuant to Section 12 of the Exchange Act, the Commission found that Entrade has failed to comply with Section 13(a) of the Exchange Act and Rules 13a-1, 13a-13 and 12b-20 thereunder, while its common stock was registered with the Commission, in that it did not file an Annual Report on Form 10-K for its fiscal years 2000 through 2005 and 2007 through 2008, and it has not filed any periodic or quarterly reports on Form 10-Q for any fiscal period after its fiscal quarter ending September 30, 2000, the Commission also found that Entrade has failed to comply with Sections 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act by failing to make and keep books, records, and accounts, which, in reasonable detail, accurately and fairly reflected the transactions and disposition of its assets, and by failing to maintain a system of internal accounting controls sufficient to provide reasonable assurances that transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles.

The Commission cautions brokers, dealers, shareholders, and prospective purchasers that they should carefully consider the foregoing information along with all other currently available information and any information subsequently issued by the company.

Further, brokers and dealers should be alert to the fact that Section 12(j) provides, in pertinent part, as follows:

No member of a national securities exchange, broker, or dealer shall make use of the mails or any means or instrumentality of interstate commerce to effect any transaction in, or to induce the purchase or sale of, any security the registration of which has been and is suspended or revoked pursuant to the preceding sentence.

Without admitting or denying the findings in the Order Instituting Proceedings Pursuant to Section 12(j) of the Securities Exchange Act of 1934, Making Findings, and Revoking Registration of Securities, Entrade consented to the entry of the order.

In addition, on August 19, the Commission issued an Order Instituting Cease-and-Desist Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934, Making Findings, and Imposing A Cease-and-Desist Order against Entrade, finding that Entrade violated Sections 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act and Rules 12b-20, 13a-1, and 13a-13 thereunder. The Order requires Entrade to cease and desist from committing or causing any violations and any future violations of Sections 13(a), 13(b)(2)(A), and 13(b)(2)(B) of the Exchange Act and Rules 12b-20, 13a-1, and 13a-13 promulgated thereunder. Entrade consented to the issuance of the Order without admitting or denying any of the findings in the Order. (Rel. 34-60533; File No. 3-13587)

In the Matter of Anthony Martin

On August 19, the Securities and Exchange Commission issued an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 and Section 203(f) of the Investment Advisers Act of 1940, and Notice of Hearing against Anthony Martin.

The Division of Enforcement alleges that, between approximately May 2005 and January 2006, Martin was a registered representative with Maxim Group LLC (Maxim), a broker-dealer registered with the Commission that also operated a registered investment adviser, Maxim Financial Advisors LLC. The Division further alleges that, on July 2, 2009, after a jury trial, Martin was found guilty of conspiracy to commit securities fraud in violation of Title 18 United States Code, Section 371, and securities fraud in violation of Title 15 United States Code, Sections 78j(b), 78ff, and 17 C.F.R. 240.10b-5 before the United States District Court for the Southern District of New York, in United States v. Dennis Michael Nouri, et al., Crim. Information No. 07-CR-1029. The counts of the criminal indictment to which Martin was found guilty alleged, inter alia, that, Martin, while associated with Maxim, knowingly and willfully employed devices, schemes, and artifices to defraud and engaged in acts, practices, and courses of business which would and did operate as a fraud and deceit upon members of the investing public, in connection with the purchases and sales of securities, and by use of the means and instrumentalities of interstate commerce and the mails.

A hearing will be scheduled before an administrative law judge to determine whether the allegations contained in the Order are true, to provide Martin the opportunity to dispute these allegations, and to determine what remedial sanctions, if any, are appropriate.

The Commission directed that an administrative law judge issue an initial decision no later than 210 days from the date of service of this order. (Rels. 34-60538, IA-2918; File No. 3-13588)

Commission Finds that Lightspeed Trading LLC Effected Hundreds of Short Sales in Contravention of September 2008 Emergency Order

On August 19, the Commission issued an order finding that Lightspeed Trading LLC, a New York-based registered broker-dealer, effected 772 short sales of financial institution securities, on behalf of its customers, from September 19 through September 29, 2008, in contravention of the Commission's emergency order of Sept. 18, 2008 (Emergency Order). The Emergency Order temporarily banned short sales of financial institution securities.

In the proceedings against Lightspeed, the Commission censured Lightspeed and ordered it to cease and desist from committing or causing any violations and any future violations of Section 12(k)(4) of the Exchange Act by failing to comply with any future Commission emergency order limiting, restricting, or prohibiting the short selling of any security. The Commission also ordered Lightspeed to pay $2,222 in disgorgement, $38 in prejudgment interest, and a $75,000 civil penalty. Lightspeed consented to the order without admitting or denying any of the Commission's findings. (Rel. 34-60540; File No. 3-13589)

In the Matter of Matthew D. Weitzman

On August 19, the Securities and Exchange Commission issued an Order Instituting Administrative Proceedings Pursuant to Section 203(f) of the Investment Advisers Act of 1940, Making Findings, and Imposing Remedial Sanctions against Matthew D. Weitzman. The Order finds that on June 26, 2009, a judgment was entered by consent against Weitzman permanently enjoining him from future violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, Sections 206(1) and 206(2) of the Investment Advisers Act, and aiding and abetting violations of Section 204 of the Advisers Act and Rules 204-2(a)(3) and 204-2(a)(7) thereunder, in the civil action entitled Securities and Exchange Commission v. Matthew D. Weitzman, Civil Action Number 09-cv-5353, in the United States District Court for the Southern District of New York. The Order finds that the Commission's complaint alleges that from at least 2005 until March 2009, Weitzman misappropriated several million dollars from AFW's advisory clients' brokerage accounts.

The Order also finds that the Commission's complaint alleges that Weitzman used these client funds to furnish a lavish and luxurious lifestyle, which included the purchase of, or acquisition of interests in, a multi-million dollar home, a horse, cars, and other luxury items. The Order also finds that the complaint alleges that Weitzman actively concealed his fraudulent scheme by forging client signatures on letters purportedly authorizing transfers of client funds out of their brokerage accounts. The Order further finds that the complaint alleges that, in addition, when certain clients questioned Weitzman about the unauthorized transfers from their accounts, Weitzman falsely stated that the funds would be used for legitimate investment purposes when in fact Weitzman misappropriated the funds for his own use. The Order finds that the Commission's complaint alleges that Weitzman prepared false quarterly account statements and provided these statements to clients, and that his misappropriation of client funds totaled in excess of $6 million.

Based on the above, the Order bars Weitzman from association with any investment adviser. Weitzman consented to the issuance of the Order without admitting or denying any of the findings. (Rel. IA-2917; File No. 3-13585)

In the Matter of Daniel M. Kantrowitz

On August 17, the Securities and Exchange Commission commenced proceedings to collect disgorgement, prejudgment interest and a penalty previously ordered in a settled public Commission administrative and cease-and-desist proceeding against Daniel M. Kantrowitz. The complaint, filed pursuant to Section 21(e) of the Securities Exchange Act of 1934, seeks a federal court order compelling Kantrowitz to pay $217,000 in disgorgement plus prejudgment interest of $3,996.41, and a civil penalty of $50,000 owed by him under the Commission's Order. The complaint charges that Kantrowitz failed to comply with the terms of the Commission's Order imposing remedial sanctions issued In the Matter of Daniel M. Kantrowitz, Administrative Proceeding File No. 3-13099 issued on April 10, 2009.

Securities and Exchange Commission v. Daniel M. Kantrowitz, Case No. 09-61272-CIV-Cooke (S.D. Fla., filed Aug. 17, 2009) (LR-21180)

SELF-REGULATORY ORGANIZATIONS

Accelerated Approval of Proposed Rule Change

The Commission has granted accelerated approval on a temporary basis of a proposed rule change filed under Section 19(b)(1) of the Exchange Act by the Fixed Income Clearing Corporation (File No. SR-FICC-2009-08) to modify the rules of the Government Securities Division regarding the calculation of clearing fund deposits relating to inter-dealer broker positions. Publication of the proposal and accelerated temporary order is expected in the Federal Register during the week of August 17. (Rel. 34-60510)

Immediate Effectiveness of Proposed Rule Changes

Boston Stock Exchange Clearing Corporation filed a proposed rule change (File No. SR-BSECC-2009-04) under Section 19(b)(3)(A) of the Securities Exchange Act of 1934, which proposed rule change became effective upon filing, to adopt recent by-law changes of NASDAQ OMX Group, Inc. as rules of BSECC. Publication is expected in the Federal Register during the week of August 17. (Rel. 34-60493)

Stock Clearing Corporation of Philadelphia filed a proposed rule change (File No. SR-SCCP-2009-03) under Section 19(b)(3)(A) of the Securities Exchange Act of 1934, which proposed rule change became effective upon filing, to adopt recent by-law changes of NASDAQ OMX Group, Inc. as rules of SCCP. Publication is expected in the Federal Register during the week of August 17. (Rel. 34-60494)

A proposed rule change filed by New York Stock Exchange (SR-NYSE-2009-80) amending its public float requirement for initial public offerings has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of August 17. (Rel. 34-60501)

A proposed rule change filed by NASDAQ OMX BX to amend the Fee Schedule of the Boston Options Exchange Facility (SR-BX-2009-047) has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of August 17. (Rel. 34-60504)

A proposed rule change (SR-NYSEAMEX-2009-51) filed by NYSE Amex adopting Rule 406 - NYSE Amex Equities as new Rule 3250 - NYSE Amex Equities to conform to a proposed rule change submitted in a companion filing by the New York Stock Exchange LLC has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of August 17. (Rel. 34-60511)

A proposed rule change (SR-NYSE-2009-75) filed by New York Stock Exchange adopting NYSE Rule 406 as new Rule 3250 to correspond with a rule change recently filed by the Financial Industry Regulatory Authority, Inc. has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of August 17. (Rel. 34-60512)

A proposed rule change (SR-CBOE-2009-059) filed by the Chicago Board Options Exchange relating to Options Regulatory Fee has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of August 17. (Rel. 34-60513)

A proposed rule change (SR-NYSEArca-2009-76) filed by NYSE Arca amending NYSE Arca Options Rule 6.76A has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of August 17. (Rel. 34-60522)

Proposed Rule Change

The Commission issued notice of a proposed rule change submitted by NYSE Arca, (SR-NYSEArca-2009-70) pursuant to Rule 19b-4 under the Securities Exchange Act of 1934 to amend Rule 10.12 (Minor Rule Plan). Publication is expected in the Federal Register during the week of August 17. (Rel. 34-60518)

JOINT INDUSTRY PLAN

Notice of Summary Effectiveness of Joint Amendment No. 1 to the Options Order Protection and Locked/Crossed Market Plan

Pursuant to Section 11A of the Securities Exchange Act of 1934 and Rule 608 of Regulation NMS thereunder, the Commission has published notice of summary effectiveness for a period not to exceed 120 days of Joint Amendment No. 1 to the Options Order Protection and Locked/Crossed Market Plan, submitted by the Chicago Board Options Exchange, International Securities Exchange, the NASDAQ Stock Market, NASDAQ OMX BX, NASDAQ OMX PHLX, NYSE Amex, and NYSE Arca. Publication of the proposal is expected in the Federal Register during the week of August 17. (Rel. 34-60507)

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