SEC News Digest

COMMISSION ANNOUNCEMENTS

Administrative Law Judge James T. Kelly to Retire After 11 Years at SEC

The Securities and Exchange Commission announced today that Administrative Law Judge James T. Kelly will retire from the federal government at the end of the month after 42 years of public service, including more than 11 years at the SEC.

During his tenure with the SEC, Judge Kelly presided over and issued initial decisions in scores of administrative proceedings brought by the SEC's Division of Enforcement. His initial decisions involved alleged violations of the antifraud provisions of the federal securities laws, improper professional conduct by accountants, price manipulation, disclosure of consulting agreements by the underwriters of municipal securities business, the sale of unregistered securities, the right to financial privacy, and charges of failure to supervise.

Judge Kelly previously served as an Administrative Law Judge at the Social Security Administration (1997 to 1999) and as Assistant General Counsel at the Commodity Futures Trading Commission (1982 to 1997).

Judge Kelly earned his A.B. in Economics, cum laude, from Georgetown University in 1969 and his J.D. from the University of Pennsylvania Law School in 1975. He served as an officer in the U.S. Navy from 1969 to 1972. (Press Rel. 2010-171)

ENFORCEMENT PROCEEDINGS

Securities and Exchange Commission Orders Hearing on Registration Suspension or Revocation Against Seven Public Companies For Failure to Make Required Periodic Filings

On September 20, 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 seven companies for failure to make required periodic filings with the Commission:

• Millennia Automated Products, Inc.
• Millenium Software, Inc.
• Momentum Software Corp.
• Moonlight International Corp.
• Moviefone, Inc.
• MSI Electronics, Inc.
• Multimedia Concepts International, Inc.

In this Order, the Division of Enforcement (Division) alleges that the seven 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 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. 34-62943; File No. 3-14058)

Securities and Exchange Commission Orders Hearing on Registration Suspension or Revocation Against Four Public Companies for Failure to Make Required Periodic Filings

On September 20, 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:

• United Education & Software, Inc.
• United Film Partners, Inc. (n/k/a Seoul Movie USA, Inc.)
• United Leisure Corp. (UTDL)
• United Rayore Gas, Ltd.

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. 34-62944; File No. 3-14059)

In the Matter of Four Crystal Funding, Inc.

An Administrative Law Judge has issued an Order Making Findings and Revoking Registration by Default (Default Order) in Four Crystal Funding, Inc., Administrative Proceeding No. 3-14008. The Order Instituting Proceedings alleged that Four Crystal Funding, Inc., failed repeatedly to file required annual and quarterly reports while its securities were registered with the Securities and Exchange Commission. The Default Order finds these allegations to be true. It revokes the registrations of each class of registered securities of Four Crystal Funding, Inc., pursuant to Section 12(j) of the Securities Exchange Act of 1934. (Rel. 34-62957; File No. 3-14008)

In the Matter of Sintec Co. Ltd.

On Sept. 21, 2010, an Administrative Law Judge issued an Order on Motion and Making Findings and Revoking Registration by Default (Default Order) as to Sintec Co. Ltd. (Sintec) in Sintec Co. Ltd., Admin. Proc. 3-13916. The Default Order finds that Sintec failed to comply with Section 13(a) of the Securities Exchange Act of 1934 (Exchange Act) and Exchange Act Rules 13a-1 and 13a-16 because it failed to make periodic filings with the Securities and Exchange Commission for a number of years. Based on these findings, the Default Order revoked the registration of each class of Sintec Co. Ltd.'s registered securities, pursuant to Section 12(j) of the Exchange Act. (Rel. 34-62958; File No. 3-13916)

Securities and Exchange Commission Orders Hearing on Registration Revocation Against Nine Public Companies for Failure to Make Required Periodic Filings

Today 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 nine companies for failure to make required periodic filings with the Commission:

• E-DOCS.MD, Inc. (EDMD)
• Electrical Generation Technology Corp.
• Electrosource, Inc.
• eLinear, Inc. (ELURQ)
• Elite Logistics, Inc. (ELOG)
• Elite Technologies, Inc. (ETCH)
• Emerald Capital Holdings, Inc.
• Enviropact, Inc.
• eTravelserve.com, Inc. (TSER)

In this Order, the Division of Enforcement (Division) alleges that the nine 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 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. 34-62962; File No. 3-14060)

SEC Charges Minneapolis Attorney and San Francisco Real Estate Lending Fund Promoters With Misleading Investors

On September 21, the Commission charged a Minneapolis attorney and two San Francisco-area real estate lending fund promoters with defrauding investors in a Minneapolis-based real estate lending fund by concealing the collapse of the fund's sole business partner.

The SEC's complaint, filed in federal court in Minneapolis, alleges that Todd A. Duckson, of Prior Lake, Minnesota, Michael W. Bozora, of Belvedere, California, and Timothy R. Redpath, of Mill Valley, California, raised more than $21 million from investors in the Capital Solutions Monthly Income Fund after the fund's sole business partner defaulted on its obligations to the fund. The SEC alleges that Bozora and Redpath launched the fund in 2004, and raised approximately $74 million from approximately 450 investors through August 2009. The SEC alleges that after the May 2008 default by the fund's sole borrower, the fund foreclosed on the borrower's real estate projects. The SEC alleges that Bozora, Redpath, and Duckson failed to disclose the default and foreclosure to investors for several months, while they misleadingly promoted the fund's ability to make new loans.

The SEC's complaint also charges True North Finance Corporation, a Minneapolis real estate lending company that merged with the fund in 2009, and True North's Chief Financial Officer, Owen Mark Williams, with accounting fraud. The SEC alleges that in 2008 and 2009, Williams caused True North to overstate its revenues by as much as 99%. The SEC alleges that True North improperly recognized revenue on interest from borrowers which were not paying True North and which were in poor financial condition.

The SEC is seeking permanent injunctions, disgorgement, prejudgment interest and civil penalties against all of the Defendants, and officer-director bars against Bozora, Redpath, Duckson, and Williams. [SEC v. True North Finance Corporation, f/k/a CS Financing Corporation, et al., Case No. 10-3995-DWF/JJK, USDC, D. Minn.] (LR-21657; AAE Rel. 3187)

SELF-REGULATORY ORGANIZATIONS

Proposed Rule Changes

The Financial Industry Regulatory Authority filed a proposed rule change (SR-FINRA-2010-036) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 to broaden arbitrators' authority to make referrals during an arbitration proceeding and creating a new rule to address the assessment of hearing session fees, costs, and expenses if an arbitrator makes a referral during a case that results in panel withdrawal. Publication is expected in the Federal Register during the week of September 20. (Rel. 34-62930)

BATS Exchange filed a proposed rule change (SR-BATS-2010-025) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 to amend BATS Rule 11.8, entitled "Obligations of Market Makers." Publication is expected in the Federal Register during the week of September 20. (Rel. 34-62945)

NYSE Arca filed a proposed rule change (SR-NYSEArca-2010-83) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 amending NYSE Arca Equities Rule 7.23 to adopt pricing obligations for ETP Holders who are registered as market makers. Publication is expected in the Federal Register during the week of September 20. (Rel. 34-62946)

NYSE Amex filed a proposed rule change (SR-NYSEAmex-2010-96) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 amending NYSE Amex Equities Rule 104 to adopt pricing obligations for Designated Market Makers. Publication is expected in the Federal Register during the week of September 20. (Rel. 34-62947)

New York Stock Exchange filed a proposed rule change (SR-NYSE-2010-69) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 amending Rule 104 to adopt pricing obligations for Designated Market Makers. Publication is expected in the Federal Register during the week of September 20. (Rel. 34-62948)

The New York Stock Exchange filed a proposed rule change (SR-NYSE-2010-67) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 relating to execution algorithm of NYBX orders. Publication is expected in the Federal Register during the week of September 20. (Rel. 34-62955)

Immediate Effectiveness of Proposed Rule Changes

A proposed rule change (SR-NYSE-2010-66) filed by New York Stock Exchange to add certain rules to the List of Exchange Rule Violations and Fines Applicable Thereto 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 September 20. (Rel. 34-62940)

A proposed rule change (SR-NYSEAmex-2010-94) filed by NYSE Amex to add certain rules to the List of Exchange Rule Violations and Fines Applicable Thereto 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 September 20. (Rel. 34-62941)

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http://www.sec.gov/news/digest/2010/dig092110.htm