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COMMISSION ANNOUNCEMENTSSecurities and Exchange Commission Suspends Trading in the Securities of Global Medical Products Holdings, Inc. for Failure to Make Required Periodic FilingsThe U.S. Securities and Exchange Commission announced the temporary suspension of trading in the securities of the following issuer, commencing at 9:30 a.m. EDT on April 23, 2010, and terminating at 11:59 p.m. EDT on May 6, 2010.
The Commission temporarily suspended trading in the securities of this issuer due to a lack of current and accurate information about the company because it has not filed periodic reports with the Commission in over two years. This order was entered pursuant to Section 12(k) of the Securities Exchange Act of 1934 (Exchange Act). 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 this company. Brokers and dealers should be alert to the fact that, pursuant to Exchange Act Rule 15c2-11, at the termination of the trading suspensions, no quotation may be entered relating to the securities of the subject company unless and until the broker or dealer has strictly complied with all of the provisions of the rule. If any broker or dealer is uncertain as to what is required by the rule, it should refrain from entering quotations relating to the securities of these companies that have been subject to a trading suspension until such time as it has familiarized itself with the rule and is certain that all of its provisions have been met. Any broker or dealer with questions regarding the rule should contact the staff of the Securities and Exchange Commission in Washington, DC at (202) 551-5720. If any broker or dealer enters any quotation which is in violation of the rule, the Commission will consider the need for prompt enforcement action. If any broker, dealer or other person has any information which may relate to this matter, they should immediately communicate it to the Delinquent Filings Branch of the Division of Enforcement at (202) 551-5466, or by e-mail at DelinquentFilings@sec.gov. (Rel. 34-61962) SEC Suspends Trading in the Securities of Five Issuers for Failure to Make Required Periodic FilingsThe U.S. Securities and Exchange Commission announced the temporary suspension of trading in the securities of the following five issuers, commencing at 9:30 a.m. EDT, April 23, 2010, through 11:59 p.m. EDT, on May 6, 2010.
The Commission temporarily suspended trading in the securities of these five issuers due to a lack of current and accurate information about the companies because they have not filed periodic reports with the Commission. This order was entered pursuant to Section 12(k) of the Securities Exchange Act of 1934 (Exchange Act). 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 these companies. Brokers and dealers should be alert to the fact that, pursuant to Exchange Act Rule 15c2-11, at the termination of the trading suspensions, no quotation may be entered relating to the securities of the subject companies unless and until the broker or dealer has strictly complied with all of the provisions of the rule. If any broker or dealer is uncertain as to what is required by the rule, it should refrain from entering quotations relating to the securities of these companies that have been subject to a trading suspension until such time as it has familiarized itself with the rule and is certain that all of its provisions have been met. Any broker or dealer with questions regarding the rule should contact the staff of the Securities and Exchange Commission in Washington, DC at (202) 551-5720. If any broker or dealer enters any quotation which is in violation of the rule, the Commission will consider the need for prompt enforcement action. (Rel. 34-61963) ENFORCEMENT PROCEEDINGSIn the Matter of Leo R. Driving Hawk, Sr.On April 23, 2010, the Commission issued an Order Making Findings and Imposing Remedial Sanctions Pursuant to Section 15(b) of the Securities Exchange Act of 1934 (Order) against Leo R. Driving Hawk, Sr. The Order finds that, on Feb. 21, 2007, a judgment was entered against Driving Hawk, permanently enjoining him from future violations of Section 17(a) of the Securities Act of 1933 and Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder in Securities and Exchange Commission v. U.S. Reservation Bank & Trust, et al., Civil Action No. 02-0581 PHX (EHC) in the United States District Court for the District of Arizona, Phoenix Division. The Order finds that the Commission's complaint alleged that, from at least November 2001 through at least April 2002, Driving Hawk engaged in a fraudulent securities offering that defrauded investors of approximately $78 million. Based on the above, the Order bars Driving Hawk from association with any broker or dealer. Driving Hawk consented to the issuance of the Order without admitting or denying any of the findings in the Order, except he admitted the entry of the injunction. (Rel. 34-61964; File No. 3-13747) Commission Dismisses Remaining Charges Against John A. Carley and Christopher H. ZachariasIn a proceeding remanded by the United States Court of Appeals for the District of Columbia Circuit, the Commission has dismissed fraud and reporting violations against John A. Carley and Christopher H. Zacharias, officers and directors of Starnet Communications International, Inc., for failing to disclose certain transactions in Starnet's 1999 annual report. As a result, the Commission also "dissolve[d] the cease-and-desist order with respect to these alleged violations." (Rel. 33-9118; 34-61966; File No. 3-11626r) Commission Dismisses Appeal Filed by PennMont Securities and Joseph D. CarapicoThe Commission has dismissed an application for review filed by PennMont Securities and Joseph D. Carapico, both suspended members of the Philadelphia Stock Exchange, of Philadelphia Stock Exchange disciplinary action. The Exchange had suspended PennMont and Carapico in January 2008 for failure to pay, pursuant to Exchange rules, almost $1 million in legal fees and expenses incurred by the Exchange in defense of litigation that was initiated by PennMont and Carapico in 1998. The Commission dismissed the appeal because it had been filed long after the thirty-day deadline set forth in the Commission's Rules of Practice and because PennMont and Carapico did not present "extraordinary circumstances" justifying their late appeal as required by the Commission's rules. (Rel. 34-61967; File No. 3 13623) William H. Lofthus SanctionedWilliam H. Lofthus (Lofthus), of Illinois, has been barred from association with any broker, dealer, or investment adviser. The sanctions were ordered in an administrative proceeding before an administrative law judge, following a 2009 state conviction for theft from a broker-dealer customer, as well as a 2006 state administrative securities bar based on his conversion of funds solicited from customers for investment in promissory notes. (Rel. 34-61965, IA-3018; File No. 3-13825) Securities and Exchange Commission Orders Hearing on Registration Revocation Against Four Public Companies for Failure to Make Required Periodic FilingsToday the Commission instituted public administrative proceedings to determine whether to revoke or suspend for a period not exceeding twelve months the registrations of each class of the securities of four companies for failure to make required periodic filings with the Commission:
In this Order, the Division of Enforcement (Division) alleges that the four issuers are delinquent in their required periodic filings with the Commission. In this proceeding, instituted pursuant to Exchange Act Section 12(j), a hearing will be scheduled before an Administrative Law Judge. At the hearing, the Administrative Law Judge will hear evidence from the Division and the Respondents to determine whether the allegations of the Division contained in the Order, which the Division alleges constitute failures to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 or 13a-16 thereunder, are true. The Administrative Law Judge in the proceeding will then determine whether the registrations pursuant to Exchange Act Section 12 of each class of the securities of these Respondents should be revoked or suspended for a period not exceeding twelve months. The Commission ordered that the Administrative Law Judge in this proceeding issue an initial decision not later than 120 days from the date of service of the order instituting proceedings. (Rel. 34-61969; File No. 3-13867) Certified Public Accountant Marlin R. Brinsky Settles SEC Enforcement Action in Exotics.com, Inc. LitigationThe Securities and Exchange Commission announced that a federal district court in Nevada has entered a final judgment, by consent, against Marlin R. Brinsky of Santa Monica, California, in connection with an enforcement action filed in 2005 concerning a penny stock manipulation and accounting fraud. The final judgment against Brinsky, a certified public accountant, was entered on April 21, 2010. It permanently enjoins him from violating provisions of the federal securities laws governing accountant's reports and orders him to pay a $20,000 civil penalty. Separately, Brinsky also consented to an administrative order suspending him from appearing or practicing before the Commission as an accountant, with a right to apply for reinstatement after two years. The Commission's civil injunctive action was filed on April 25, 2005, against Exotics.com, Inc., a Nevada corporation based in Vancouver, British Columbia, and 12 additional principal defendants and one relief defendant. The Commission's complaint alleged that, between at least 1999 and 2002, Exotics.com, which was then an Over-the-Counter Bulletin Board company in the business of operating adult Web sites, was the subject of a stock manipulation and accounting fraud. The complaint alleged, among other things, that Brinsky and others engaged in conduct that resulted in Exotics.com filing materially false and misleading financial statements in its Commission filings. The complaint further alleged that the staff of Exotics.com's outside auditor, of which Brinsky was a member, committed acts and/or omissions that caused them to become non-independent during audits of Exotics.com and that their firm thereafter issued audit reports falsely representing that the audits had been conducted by an independent accountant. Those audit reports were incorporated in Exotics.com's Commission filings. According to the complaint, the audit reports, among other things, falsely stated that the audits had been conducted by an independent auditor and in accordance with generally accepted auditing standards (GAAS). The complaint also alleged that Brinsky and other members of the audit team engaged in a number of improper accounting practices that caused Exotics.com's financial statements to depart from generally accepted accounting principles (GAAP). Without admitting or denying the allegations in the Commission's complaint, Brinsky consented to the entry of final judgment against him. The final judgment against Brinsky enjoins him from violating Rule 2-02 of Regulation S-X and orders him to pay a civil penalty of $20,000. Brinsky also consented to the entry of an Administrative Order, pursuant to Rule 102(e) of the Commission's Rules of Practice, suspending him from appearing or practicing before the Commission as an accountant, with a right to apply for reinstatement after two years. The Commission previously obtained judgments by default against two defendants and judgments by consent against six additional defendants. The action remains pending against the remaining four defendants and a relief defendant. For further information, see Litigation Release Nos. 19207 (April 28, 2005) [civil injunctive action filed], 19645 (April 7, 2006) [judgment by default against Exotics.com], 19699 (May 15, 2006) [judgment by consent against Barry F. Duggan], 19957 (Jan. 4, 2007) [judgment by default against Gary Thomas], 21028 (May 7, 2009) [judgment by consent against Edward James Wexler], 21456 (March 19, 2010) [judgments by consent against Stephen P. Corso and Brian K. Rabinovitz], 21490 (April 16, 2010) [judgments by consent against Ingo W. Mueller and Firoz Jinnah] and Exchange Act Release Nos. 59766 (April 14, 2009) [forthwith suspension of Stephen P. Corso, CPA] and 61771 (March 24, 2010) [suspension of Brian K. Rabinovitz, CPA]. [SEC v. Exotics.com, Inc., et al., Civil Action No. 2:05-cv-00531-PMP-GWF, USDC, District of Nevada] (LR-21498; AAE Rel. 3128) District Court Enters Final Judgments Ordering a Civil Penalty Against Defendants Osvaldo Pitters and Terrell J. Kuykendall and Final Judgment of Permanent Injunction Against Defendant Steven M. IvesterThe Securities and Exchange Commission announced that on April 2 and April 13, 2010, a District Judge in the Southern District of Florida entered Final Judgments against two defendants in a corporate accounting fraud case ordering them to each to pay a civil penalty of $130,000. United States District Judge Donald Graham ordered Osvaldo Pitters, the former chief financial officer of VoIP, Inc, a now defunct Internet communications company, and Terrell Kuykendall, the general manager of a VoIP subsidiary, to pay the penalties pursuant to Section 21(d)(3) of the Securities Exchange Act of 1934 (Exchange Act) and Section 20(d) of the Securities Act of 1933 (Securities Act). The Court at the Commission's request dismissed the Commission's claims for disgorgement and prejudgment interest against Pitters and Kuykendall. The Commission also announced that on April 15, 2010, United States Magistrate Judge Edwin Torres entered a Final Judgment of Permanent Injunction and Other Relief by consent against VoIP's former chief executive officer, Steven M. Ivester, in the same case. Ivester neither admitted nor denied the allegations of the complaint in the consent. The Final Judgment imposed a permanent injunction on Ivester against future violations of Sections 17(a)(2) and (3) of the Securities Act, Section 16(a) and Rules 13a-14 and 16a-3 of the Exchange Act. It also ordered Ivester to pay $122,082, which consists of disgorgement of $55,018, $12,064 in prejudgment interest and a civil money penalty of $55,000. The Commission filed a complaint against Ivester, Pitters, and Kuykendall in April 2009, alleging they fraudulently recorded fictitious sales in VoIP's financial statements and in publicly filed periodic reports with the Commission, that caused VoIP's financial statements and books and records to be materially inaccurate. The District Court had previously entered permanent injunctions by default against Pitters and Kuykendall. [SEC v. Osvaldo Pitters and Terrell J. Kuykendall, Case No. 09-cv-20957-Graham/Torres (S.D. Fla.)] (LR-21499) SEC Obtains Final Judgment of Permanent Injunction and Other Relief Against Defendants Kederio Ainsworth, Jesus Gutierrez, Guillermo Haro, Gabriel Paredes and Angel RomoOn April 21, 2010, the United States District Court for the Central District of California entered a Final Judgment of Permanent Injunction and Other Relief against Defendants Kederio Ainsworth, Jesus Gutierrez, Guillermo Haro, Gabriel Paredes and Angel Romo (collectively, Defendants) permanently restraining and enjoining Defendants from violations of Section 17(a) of the Securities Act of 1933 (Securities Act), and Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder and from aiding and abetting future violations of Section 17(a) of the Exchange Act and Rules 17a-3(a)(6) and 17a-3(a)(17) thereunder. The Court also ordered Kederio Ainsworth to disgorge $2,418 and to pay a civil monetary penalty of $2,418, Jesus Gutierrez to disgorge $2,507 and to pay a civil monetary penalty of $2,507, Guillermo Haro to disgorge $15,000 and to pay a civil monetary penalty of $15,000, Gabriel Paredes to disgorge $5,014 and to pay a civil monetary penalty of $5,014 and Angel Romo to disgorge $1,118 and to pay a civil monetary penalty of $1,118. The Defendants consented to the Court's entry of Final Judgment without admitting or denying the Complaint's allegations. The Commission's Complaint charged Defendants with violations of the antifraud provisions of the securities laws by selling unsuitable securities, primarily Variable Universal Life insurance policies. [SEC v. Ainsworth, et al., Case Number EDCV 08-1350 VAP (OPx) (C.D. Cal.] (LR-21501) SECURITIES ACT REGISTRATIONSRECENT 8K FILINGS
http://www.sec.gov/news/digest/2010/dig042310.htm
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