http://www.thestreetsweeper.org To educate and protect the public from what are believed, in good faith, to be misleading and/or false representations by public companies as well as questionable/improper business practices of brokers/brokerage firms and the stocks they are promoting. http://www.thestreetsweeper.org/streetpatrol_archives.html U.S. Attorney's Office in Manhattan said the sentence was handed down against Sekaran, 44, who had been president and director of Wasson Capital Ltd. Prosecutors said Sekaran misled investors over the value of his options investment fund, and also provided false account balances and performance statements. From 1999 until 2012, he also lost $2 million for his investors and misappropriated $500,000, the government said. Aside from prison time, he was also ordered to pay more than $4.5 million in restitution and forfeitures.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Columbus Dispatch reported. The CEO, 62-year-old Steve Fishman, plans to retire soon. “This just verifies that we have always been aboveboard and done the right thing,” the Dispatch quoted Fishman as saying.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Thomson Reuters reported. The news service said a Massachusetts appellate judge panel has struck down objections by accounting giant KPMG, which was sued by 27 investors who lost money to hedge funds the firm had audited. The plaintiffs said KPMG failed to spot red flags in the investments. But KPMG maintained that investors could only take action through arbitration, not in the courts. Not so, the appellate panel has now ruled, saying the lawsuit can proceed. “Now we're off to the races,” Thomson Reuters quoted a lawyer for the investors as saying.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Compliance Week. The Internet news site said Institutional Shared Services, a proxy advisory firm, will pay $300,000 for failing to safeguard confidential proxy voting information. However, the person who blew the whistle in the case apparently will walk away with nothing. Guidelines to the Dodd-Frank whistleblower provisions require that for a reward to be made by the SEC, the resulting enforcement action must result in sanctions worth more than $1 million, Compliance Week said.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Compliance Week said the case stemed from a 2012 campaign for governor by Timothy P. Cahill, who was Massachusetts state treasurer at the time. Goldman investment banker Neil M.M. Morrison was accused of using the company's offices and resources to back Cahill with non-cash contributions that included fund-raising, speech writing, dealing with the press, and interviewing a potential running mate. To settle the case, Goldman agreed to pay the Securities and Exchange Commission a $3.75 million penalty and more than $8 million in disgorgement and interest. Now, Morrison will pay his own penalty, described by the SEC as the largest-ever pay-to-play cost assessed an individual.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html A federal court has frozen the assets of a Dallas, Texas broker who is charged with making illegal profits by front-running trades ordered by his clients. The Securities and Exchange Commission reported the action against Daniel Bergin, 40, who worked at Cushing MLP Asset Maagement LP. The SEC said that between 2011 and 2012, Bergin allegedly made $1.7 million in profits by making trades through his wife's account before placing the same trades ordered by his customers. The front-running occurred on hundreds of occasions, regulators said. The SEC received a court order freezing assets belonging to Bergin and his wife, and is seeking disgorgement, fines, and injunctions in the case.

]]> http://www.thestreetsweeper.org/streetpatrol_archives.html A once-influential hedge fund manager in Charlotte, N.C. has pleaded guilty to a Ponzi scheme that ultimately caused the collapse of his fund. The Associated Press said Stephen Maiden, 40, is now free on bond pending sentencing. He pulled an $8.9 million scam through his Maiden Capital Opportunity Fund, paying early investors with money from newer ones, the AP said. Maiden is now looking at a maximum prison term of 20 years and a $250,000 fine, the wire service said.

]]> http://www.thestreetsweeper.org/streetpatrol_archives.html InvestmentNews reported that Blake Richards was reported to LPL by another broker. The company investigated and fired him the next day, concluding that Richards had been stealing from client accounts. He is now charged in a civil action filed by the Securities and Exchange Commission.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Securities and Exchange Commission charged the city of 11,000 residents with borrowing the money to build a mixed retail and parking garage project and claiming the deal was eligible for tax-exempt financing. It turned out the city jeopardized that status by improperly loaning proceeds to a private developer and restucturing a lease agreement. Without admiting or denying wrongdoing, the city has agreed to hire an independent third-party consultant who will ride herd on its municipal bond disclosures and procedures for three years.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Commodity Futures Trading Commission action charging William Center, of Richmond, Va., and Gregory Center, of McLean, Va., with soliciting $28.4 million from investors and misappropriating $9.6 million. Between them, the individual and corporate defendants will now pay a total of more than $15 million in disgorgement, penalties, and restitution, the CFTC said.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Ponzitracker.com said she was accused of running a scheme that raised at least $70 million from friends, relatives and others, claiming they would get high returns from her activities in trading futures and speculative stocks. But as she began losing money, Lin kept on soliciting new investments and paying early investors with cash from later ones. Her scam fell apart in 2011, and she has now been sentenced to death - maybe by a firing squad. There appears to be a chance the death sentence could be commuted, in which case Lin would likely spend the rest of her life in prison, Ponzitracker added.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html InvestmentNews said the punishment was issued by the secretary of the Commonwealth of Massachusetts against Ameriprise Financial Services, Commonwealth Financial Network, Royal Alliance Associates Inc., Securities America Inc., and Lincoln Financial Advisors Corp. The actions came from a state investigation of REIT sales that was the result of investor complaints, InvestmentNews said.

]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Commodity Futures Trading Commission announced a New York federal court consent judgment and injunctions against Spencer Montgomey and Brian Reynolds, along with a default judgment against Arjent Capital Markets LLC and Chicago Trading Managers LLC. Regulators said that between 2008 and 2009, Montgomery and Reynolds defrauded investors who put up $10.5 million for a commodities trading pool. The two allegedly issued false statements and overblew the size of pool assets, neglecting to mention that assets had been diluted by debits being held in the same account. The CFTC said Montgomery and Reynolds were each ordered to pay $140,000 civil penalties, while the two companies were jointly ordered to pay $1.4 million in penalties. Arjent will also pay a another $140,000 penalty.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html KIVI-TV reported that Mark Ellison, 64, David Swenson, 35, and Jeremy Swenson, 40, ran the DBSI group of companies, which included real estate and investment operations. They face numerous criminal counts for allegedly telling investors in 2007 and 2008 that their operations were profitable, and were worth $105 million. In reality, prosecutors allege, the defendants' primary investment vehicle, called the DBSI Master Lease program, was losing $3 million per month. Charges against the trio include conspiracy, as well as securities, mail, and wire fraud. A jury trial is scheduled for June 24, the news report said.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Bloomberg reports that the former beauty queen who went to prison for illegally passing insider trading tips along to hedge fund manager Raj Rajaratnam quietly returned to New York City in January, and has been living at a federal halfway house in the North Bronx. Readers may recall that Chiesi, 47, was nabbed for insider trading and spent 15 months at a prison camp in West Virginia. The former high-flying stock analyst is among more than 70 fund managers, stock traders, analysts, and others who have been convicted by the feds on insider charges since August 2009. Said Chiesi to a Bloomberg reporter: “It's good to be back. I feel good. I feel great.”
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Prosecutors said Mitchell J. Stein, 53, of Hidden Hills, Calif., was convicted at trial this week for manipulating the stock price of Signalife Inc., a publicly traded company that sold electronic heart monitoring devices. Stein was charged with creating false sales figures that inflated the value of shares in Signalife, now known as Heart Tronics. Officials said he made millions through manipulative trading, including $1.8 million gained in a single swoop by issuing shares to a third party who sold them and then paid him. Stein will be sentenced Aug. 16; his convictions could bring a possible maximum of 190 years in prison, the government said.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html U.S. Attorney's Office in L.A. reported the punishments for the defendants, who were also ordered to pay more than $27 million in restitution. The three - Alan G. Flesher, 65, the ringleader; his brother, Wayne D. Flesher, 62; and Nanacy Carol Khalial, 65 - pleaded guilty to soliciting investments to buy and install “Ad Toppers,” computer monitors that would be placed atop ATM machines and broadcast video advertisements. The whole thing turned out to be a Ponzi scheme that took money from investors between 2001 and 2005, federal prosecutors said. Alan Flesher received the harshest prison term of all the defendants, and will be packing off for 210 months.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html InvestmentNews reported the fine, levied by the Financial Industry Regulatory Authority, a private securities industry watchdog. FINRA said LPL - a financial planning and investment firm with 2,900 employees in Boston, Charlotte and San Diego - suffered 35 major e-mail system failures between 2007 and this year. The company, which said it cooperated with the FINRA investigation, accepted the settlement without admitting or denying the charges, InvestmentNews said.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html U.S. Department of Justice said. Salt Lake city resident Patrick Merrill Brody, 47, was originally charged in a nine-count indictment with soliciting investments to buy, restore, and run rental properties. But prosecutors said he and his wife commingled investor funds with other money, made Ponzi payments, and misappropriated cash for personal expenses. Brody finally pleaded guilty to wire fraud and money laundering, Justice Department officials said. He will be sentenced July 25 under a plea bargain deal that calls for 41 months in prison and restitution of more than $1.3 million.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Commodity Futures Trading Commission said Robert A. Christy, of Milton, Ga., and his Crabtree Capital Group LLC had been the subjects of an enforcement action in 2012, when they were charged with running a fraudulent foreign exchange currency trading pool. The CFTC said Christy and Crabtree had been ordered in October 2012 to pay $2.6 million in restitution and penalties, for lying to 22 investors and misappropriating their money. Now, a new action taken this week assures they will never legally trade again, the CFTC said.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html U.S. Attorney's Office in San Diego said Bradley Holcom, 55, of Canby, Ore., faces eight counts of mail fraud, four counts of wire fraud, and one count of securities fraud. He allegedly solicited money from investors for residential and commercial property developments, promising to secure their interests with first position leins that could be foreclosed upon if the projects failed. But the leins allegedly did not exist, and Holcom knew that many of the properties he sold were already encumbered, prosecutors said. The scheme ran from at least 2004 through 2010, the U.S. Attorney's Office said.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Kansas City Star reports that five of the ringleaders, including the company's founder, have been convicted at trial. Nine other defendants had already pleaded guilty. The founder, Isreal Owen Hawkins, unsuccessfully defended himself at trial. And that's about the end of the story. Sentencings are still pending.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html U.S. Department of Justice said Lankford, 39, was sentenced in Oklahoma. He and others had acquired controlling interests in three penny stocks, then manipulated trading and pumped up share values by blasting fraudulent positive faxes and e-mails to thousands of investors, the government said. A prosecutor said Lankford & friends made millions at the expense of legitimate investors, “without regard to anything but their wallets.”
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Stockwatch reported that Amyot filed a motion to dismiss charges by the Securities and Exchange Commission. The agency is accusing Amyot of pumping up the stock price of Spencer Pharmaceuticals by fraudulently claiming the company would be acquired for $245 million. Amyot then allegedly dumped shares of the firm through offshore accounts, Stockwatch said. In his motion, Amyot said the SEC does not have the evidence to support its claims, and the pump-and-dump occurred long after he ceased to be an officer or director at the company. Amyot wants the charges dismissed before the case ges to trial, Stockwatch added.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Huffington Post, the privately owed museum in Washington, D.C. opened its Bernie Madoff Exhibit. The permanent exhibition of Madoff personal and business items will put the $50 billion fraudster right up there with the likes of other displays including Bonnie & Clyde and John Dillinger. Madoff is now serving 50 years in prison for defrauding major corporations, the wealthy and powerful, and individual investors alike. Opined the Huffington Post: “This exhibit is sure to be an insightful look into the life of a man who destroyed so many.”

]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Commodity Futures Trading Commission complaint filed in 2010 against Philip Milton and Trade, LLC. Milton will now pay restitution of $10.8 million and a $7.6 million penalty, the CFTC said, while Trade, LLC will pay restitution and penalties of $11.4 million and $24.8 million. Relief defedants in the case will pay about another $4 million. Litigation against two other men still continues, the CFTC added.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Sydney Morning Herald reported. The newspaper said Norman Graham, 53, the former director of the brokerage firm Lonsec, has pleaded guilty to two counts of insider trading. He admitted to dumping shares of Clean Seas Tuna, a fish farming company, after learning the firm was about to announce a $14.2 million loss. Perhaps because Graham's lawyer told the court his client had been ordered by investors beforehand to sell off their Clean Seas shares, the court is not expected to impose a jail term, the Morning Herald said. But Graham can never again hold a broker's license, and is barred from working as a company director for five years. His firm's profit from making the illegal trades? The Morning Herald said Lonsec made $371.07 on the deal.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html Securities and Exchange Commission filed an action in federal court against Charles J. Dushek and his son, Charles S. Dushek, along with their investment firm, Capital Management Associates, of Lisle, Ill. Regulators said that from 2008 to 2012, the men placed millions of dollars worth of stock trades, but waited to allocate the trades until they knew whether the transactions were profitable. They then kept the winning deals for themselves and assigned the losers to the accounts of clients - many of whom were senior citizens, the SEC said. The senior Dushek used his profits to maintain his luxury home, buy a Mercedes, and take vacations abroad. His son allegedly used trading profits to support a lifestyle that included boats, ski vacations, and getaways to Hawaii. The SEC is seeking final judgments requiring the men to return all of their gains, along with penalties and interest.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html New York Times said. The newspaper quoted anonymous sources as saying Mark Lyttleton, 41, and an unidentified woman were arrested as the country's Financial Conduct Authority continues a crackdown on financial crimes. Lyttleton had managed two BlackRock investment funds, UK Dynamic and UK Absolute Alpha, The Times said. He is now believed to have left the company.
]]> http://www.thestreetsweeper.org/streetpatrol_archives.html NBC Southern California reported that Edward Fitzgerald is charged with ripping off investors who kicked in money for his company, Dana Island Yacht Sales and Charters. The cash was used to buy and sell boats, but investors seldom got returns on their money, NBC said. Fitzgerald, who is charged with stealing $1.6 million, now faces 58 counts of grand theft, elder abuse, and fraud.
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