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COMMISSION ANNOUNCEMENTSSEC, FINRA Announce 2011 National Seminar for Broker-Dealer CCOsThe Securities and Exchange Commission and Financial Industry Regulatory Authority (FINRA) today announced that the annual CCOutreach BD National Seminar will be held on Feb. 8, 2011, at the SEC's Washington, D.C., headquarters. The seminar helps provide a forum for discussion on effective compliance practices and timely compliance issues in ever-changing markets. It will help broker-dealer chief compliance officers (CCOs) effectively communicate compliance risks, maintain compliance controls, and foster robust compliance programs within their firms - all for the benefit of investors. "The CCOutreach BD program has proven invaluable in helping the SEC understand the needs and concerns of compliance officers," said Carlo di Florio, Director of the SEC's Office of Compliance Inspections and Examinations (OCIE). "In this time of regulatory changes, it is more important than ever to maintain effective communication between regulators and the industry and to reinforce our commitment to prevent securities laws violations and better serve investors." FINRA Member Regulation EVP Susan Axelrod said, "FINRA is pleased to continue the partnership with the SEC to provide this opportunity for broker-dealer compliance chiefs and regulators to foster open lines of communication, share information and work together. Given the comprehensive changes now underway throughout the industry, face-to-face meetings of this kind are more valuable than ever." OCIE, in coordination with the SEC's Division of Trading and Markets, sponsors the CCOutreach BD program together with FINRA. Panelists at the CCOutreach BD National Seminar will include SEC and FINRA staff and CCOs from broker-dealer firms. The seminar will feature relevant topics for broker-dealer CCOs or senior compliance staff if CCOs cannot attend. The SEC and FINRA staff are requesting input from CCOs on topics to discuss in order to make the National Seminar a practical and informative experience. There is no cost to attend the National Seminar, but attendance is limited to 500 with priority given to broker-dealer CCOs on a first-come, first-serve basis. The event also will be webcast on the SEC website. Registration for the seminar will begin next month. Additional details about the CCOutreach BD program and the National Seminar are available on the SEC website and the FINRA website. (Press Rel. 2010-203) Commission MeetingsClosed Meeting - Thursday, October 28, 2010 - 9:30 a.m.The subject matter of the Closed Meeting scheduled for Thursday, October 28, will be: institution and settlement of injunctive actions; institution and settlement of administrative proceedings; and other matters relating to enforcement proceedings. At times, changes in Commission priorities require alterations in the scheduling of meeting items. For further information and to ascertain what, if any, matters have been added, deleted or postponed, please contact: The Office of the Secretary at (202) 551-5400. ENFORCEMENT PROCEEDINGSCommission Revokes Registration of Securities of Electric Mail Co., Inc. (n/k/a Lero Gold Corp.) for Failure to Make Required Periodic FilingsOn October 22, the Commission revoked the registration of each class of registered securities of Electric Mail Co., Inc. (n/k/a Lero Gold Corp.) (Electric Mail) for failure to make required periodic filings with the Commission. Without admitting or denying the findings in the Order, except as to jurisdiction, which it admitted, Electric Mail consented to the entry of an Order Making Findings and Revoking Registration of Securities Pursuant to Section 12(j) of the Securities Exchange Act of 1934 as to Electric Mail finding that it had failed to comply with Section 13(a) of the Securities Exchange Act of 1934 (Exchange Act) and Rules 13a-1 and 13a-16 thereunder and revoking the registration of each class of Electric Mail's securities pursuant to Section 12(j) of the Exchange Act. This order settled the proceedings brought against Electric Mail in In the Matter of Electric Mail Co., Inc. (n/k/a Lero Gold Corp.), et al., Administrative Proceeding File No. 3-14046. Brokers and dealers should be alert to the fact that Exchange Act 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 . . . . For further information see Order Instituting Administrative Proceedings and Notice of Hearing Pursuant to Section 12(j) of the Securities Exchange Act of 1934, In the Matter of Electric Mail Co., Inc. (n/k/a Lero Gold Corp.), et al., Administrative Proceeding File No. 3-14046, Exchange Act Release No. 62904, September 14, 2010. (Rel. 34-63159; File No. 3-14046) In the Matter of Sands Brothers Asset Management LLC, et al.On October 22, the Commission issued an Order Instituting Administrative and Cease-and-Desist Proceedings, Making Findings, and Imposing Remedial Sanctions and a Cease-and-Desist Order Pursuant to Sections 203(e), 203(f) and 203(k) of the Investment Advisers Act of 1940 against Sands Brothers Asset Management LLC (SBAM), Steven Sands (S. Sands) and Martin Sands (M. Sands). The Order finds that SBAM, an investment adviser registered with the Commission, willfully violated the record keeping, custody rule, and form ADV filing requirements of the Investment Advisers Act of 1940 (Advisers Act), and that S. Sands and M. Sands willfully aided and abetted and caused SBAM's violations. The Commission's Order finds that SBAM violated (i) Section 204 of the Advisers Act and Rules 204(2)(a) and (b) thereunder governing the retention and production to the staff upon request of certain required documents and books and records; (ii) Section 206(4) of the Advisers Act and Rule 206(4)-2 thereunder governing the delivery of account statements and surprise examination requirements for certain SBAM funds; and (iii) Sections 204 and 207 of the Advisers Act and Rule 204-1 thereunder governing the disclosures and amendments to SBAM's investment adviser registration statement on Form ADV. The Order also finds that S. Sands and M. Sands, sometimes acting through employees and agents including compliance personnel, were principal contact persons for SBAM in responding to the Commission staff's inquiries and otherwise communicating with the staff during examinations of SBAM. As the lead principals of SBAM, S. Sands and M. Sands, acting through employees and agents including compliance personnel, were also responsible for ensuring that SBAM's filings on Form ADV were accurate and up to date. Based on the above, the Order censures SBAM, S. Sands and M. Sands and requires them to cease and desist from committing or causing violations and any future violations of Sections 204, 206(4), and 207 of the Advisers Act and Rules 204-1, 204-2, and 206(4)-2 thereunder. The Order also imposes a $60,000 civil penalty on SBAM. SBAM, S. Sands and M. Sands each consented to the issuance of the Order without admitting or denying any of the findings therein. (Rel. IA-3099; File No. 3-14097) In the Matter of Vikonics, Inc., et al.On October 22, an Administrative Law Judge issued an Initial Decision in Vikonics, Inc., Administrative Proceeding No. 3-13918, as to VoiceIQ, Inc. (n/k/a Yoho Resources, Inc.), a Canadian company headquartered in Calgary, Alberta, Canada. Yoho Resources, Inc.'s (Yoho) registration of securities terminated on October 5, 2010, as the result of a Form 15, Notice of Termination of Registration under Section 12 of the Exchange Act, filed after the Commission instituted the administrative proceeding. The Administrative Law Judge dismissed the proceeding over the objection of the Division of Enforcement because the only remedy allowed under Section 12(j) of the Exchange Act for a violation of Exchange Act Section 13 and certain Exchange Act rules is either revocation or suspension of the registered securities and that was accomplished by withdrawal of the registration. (Initial Decision No. 405; File No. 3-13918) Former Broker and His Customer Settle Charges Arising from Scheme to Defraud Institutional CustomerThe Securities and Exchange Commission today announced that on September 27, 2010, the Honorable George B. Daniels of the United States District Court for the Southern District of New York entered a partial judgment against Defendant Jose O. Vianna, Jr., a former registered representative of Maxim Group LLC, a registered broker-dealer. On September 20, 2010, Judge Daniels also entered a final judgment against Relief Defendant Creswell Equities, Inc. The SEC's complaint, filed on March 9, 2010, alleges that between July 2007 and March 2008, Vianna, while a registered representative at Maxim Group LLC, diverted profitable trades from the account of a large Spanish bank, referred to in the complaint as Customer A, to the account of Creswell, a British Virgin Islands company. The complaint alleges that Vianna simultaneously entered orders in the accounts of Customer A and Creswell to trade the same amounts of the same stock. Each time, he placed a buy order in one customer's account and a sell order in the other customer's account. When the market moved to make Customer A's trade profitable and Creswell's trade unprofitable, Vianna improperly misused his access to Maxim's order management system to divert Customer A's profitable trade to Creswell by changing Maxim's records to switch the identity of buyer and seller to the trade. Vianna agreed to settle the SEC's charges by consenting to the entry of a judgment permanently enjoining Vianna from violating 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 and from violating, or aiding and abetting violations of, Section 17(a) of the Exchange Act, and Rule 17a-3 thereunder. In addition, the judgment provides for the payment of disgorgement plus prejudgment interest, and the imposition of civil monetary penalties, in amounts to be determined at a later date. Creswell agreed to settle the SEC's claim by consenting to the entry of a judgment ordering Creswell to pay $1,661,650.18 in disgorgement. [SEC v. Jose O. Vianna, Jr. and Creswell Equities, Inc., Case No. 10 Civ. 1842 (GBD) (S.D.N.Y.)] (LR-21704) SEC Files Enforcement Action Against Former Registered Representative Shawn A. Icely for Misappropriating Customer FundsOn October 21, the Commission filed a civil injunctive action against Shawn A. Icely alleging violations of the antifraud provisions of the federal securities laws in connection with his misappropriation of hundreds of thousands of dollars from customers of American Portfolios Financial Services, Inc. while he was employed there as a registered representative. The Commission's complaint alleges that, from no later than November 2008 through December 2009, Icely fraudulently diverted approximately $625,000 from American Portfolios customer accounts to his company, Icely, Inc. According to the complaint, Icely diverted the money by using wire transfer forms or IRA distribution forms that were forged. The complaint further alleges that to facilitate and otherwise conceal his fraud, Icely told customers that their money was transferred to bank accounts in their name or that the money was being transferred to new accounts at another brokerage firm. The complaint alleges that Icely defrauded at least 11 customers, many of whom had long-standing business and personal relationships with Icely. The Commission's complaint charges Icely with violating Section 17(a) of the Securities Act of 1993, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10(b) thereunder. The complaint seeks a permanent injunction prohibiting future violations of the securities laws, disgorgement of all ill-gotten gains, and a civil money penalty against Icely. [SEC v. Shawn A. Icely, Civil Action No. 8:10-CV-2363-T17-AEP (M.D. Fla.)] (LR-21705) District Court Enters Final Judgments Imposing Civil Penalties Against Defendants Prime Time Group, Inc., n/k/a Hunt Gold Corporation and Johnny Ray ArnoldThe Commission announced that on October 20, 2010, the Honorable James I. Cohn, United States District Court Judge for the Southern District of Florida, entered final judgments imposing civil penalties against Defendants Prime Time Group, Inc., n/k/a Hunt Gold Corporation (Prime Time) and Johnny Ray Arnold (Arnold). The final judgment orders Prime Time to pay a civil penalty of $325,000 and orders Arnold to pay a civil penalty of $65,000. Previously, the District Court entered default judgments against Prime Time and Arnold. The default judgments permanently enjoin Prime Time and Arnold from future violations of Sections 5(a) and 5(c) of the Securities Act of 1933 and Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934. In addition, Arnold is barred from participating in the offering of any penny stock. On June 25, 2009, the Commission commenced this action by filing its complaint against Prime Time, Arnold and others alleging they participated in a fraudulent scheme to evade the registration requirements of the securities laws and antifraud violations. [Securities and Exchange Commission v. Prime Time Group, Inc., et al., Civil Action No. 09-80952-CV-Cohn/Seltzer (S.D. Fla.)] (LR-21706) Permanent Injunction and Other Relief Entered Against Defendants Victor Selenow and Edward TamimiThe Commission announced that on October 15, 2010, the Honorable Kenneth A. Marra, United States District Court Judge for the Southern District of Florida, entered final judgments of permanent injunction and other relief against Defendants Victor Selenow and Edward Tamimi, two sales agents for Winning Kids, Inc. The final judgments against Selenow and Tamimi enjoin them from violating Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933, and Sections 10(b), 15(a), and Rule 10b-5 of the Securities Exchange Act of 1934. In addition to injunctive relief, Selenow is liable for disgorgement of $41,500, plus prejudgment interest of $3,883 and a civil penalty of $50,000. Tamimi is liable for disgorgement of $194,250, plus prejudgment interest of $14,176.46 and a civil penalty of $130,000. Selenow and Tamimi consented to the entry of final judgments without admitting or denying any of the allegations in the complaint. On January 29, 2010, the Commission filed its complaint against Selenow, Tamimi and others alleging that they participated in a fraudulent offering scheme that raised approximately $2 million from investors nationwide, purportedly for the development and marketing of children's books. [SEC v. Winning Kids, Inc., et al., Civil Action No. 10-CV-80186-MARRA/JOHNSON (S.D. Fla.)] (LR-21707) INVESTMENT COMPANY ACT RELEASESOrders of Deregistration Under the Investment Company ActOrders have been issued under Section 8(f) of the Investment Company Act declaring that each of the following has ceased to be an investment company:
Modern Woodmen of America Variable AccountAn order has been issued under Section 8(f) of the Investment Company Act declaring that Modern Woodmen of America Variable Account has ceased to be an investment company. (Rel. IC-29479 - October 21) Kemper Investors Life Insurance Company (KILICO)An order has been issued under Section 8(f) of the Investment Company Act declaring that Kemper Investors Life Insurance Company's KILICO Variable Annuity Separate Account - 3 has ceased to be an investment company. ((Rel. IC-29480 - October 21) MLIG Variable Insurance TrustAn order has been issued pursuant to Section 8(f) of the Investment Company Act declaring that MLIG Variable Insurance Trust has ceased to be an investment company. (Rel. IC-29481 - October 21) SELF-REGULATORY ORGANIZATIONSImmediate Effectiveness of Proposed Rule ChangesA proposed rule change filed by NASDAQ OMX PHLX (SR-Phlx-2010-141) to permit certain FLEX Options to trade under the FLEX trading procedures for a limited time on a closing only basis 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 October 25. (Rel. 34-63140) A proposed rule change filed by NASDAQ OMX PHLX (SR-Phlx-2010-143) relating to active SQF port 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 October 25. (Rel. 34-63145) A proposed rule change filed by the BATS Exchange related to fees for use of BATS Exchange, Inc. (SR-BATS-2010-030) 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 October 25. (Rel. 34-63146) A proposed rule change filed by the BATS Exchange to amend BATS Rule 11.13, entitled "Order Execution" (SR-BATS-2010-029) 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 October 25. (Rel. 34-63147) A proposed rule change filed by the BATS Y-Exchange to amend Rule 11.13, entitled "Order Execution," (SR-BYX-2010-003) 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 October 25. (Rel. 34-63148) A proposed rule change filed by the BATS Y-Exchange related to fees for use of BATS Y-Exchange, Inc. (SR-BYX-2010-004) 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 October 25. (Rel. 34-63149) Accelerated Approval of Proposed Rule ChangeThe Commission issued notice of filing of Amendment No.1, and granted accelerated approval to a proposed rule change, as modified by Amendment No. 1, submitted by the Financial Industry Regulatory Authority (SR-FINRA 2009-058) pursuant to Rule 19b-4 under the Securities Exchange Act of 1934 to adopt FINRA Rule 2232 (Customer Confirmations) in the Consolidated FINRA Rulebook and delete NASD Rule 2230, NASD IM-2110-6 and Incorporated NYSE Rule 409(f). Publication is expected in the Federal Register during the week of October 25. (Rel. 34-63150) SECURITIES ACT REGISTRATIONSRECENT 8K FILINGS
http://www.sec.gov/news/digest/2010/dig102210.htm
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