SEC Actions & Administrative Proceedings

Most public companies realize that the Securities and Exchange Commission (the “SEC”) is a law enforcement agency.  Receiving an SEC subpoena is a new experience for most market participants. SEC Actions can involve a case in federal court or… Read More

Finra Investigates BNP Paribas

On October 24, 2019, the Financial Industry Regulatory Authority (FINRA) announced a settled enforcement action involving BNP Paribas Securities Corp. and BNP Paribas Prime Brokerage, Inc.  A lengthy FINRA investigation found that although the firms did a brisk… Read More

Regulation A+ 2019 Q&A – Securities Lawyer 101

Regulation A provides an  exemption from registration that can be used in combination with a Rule 506 private placement, a direct public offering and/or initial public offering by a private company or company seeking to go public. Since Regulation A was… Read More

Our Comment to the SEC Regarding Rule 211 (15c2-11) – Sponsoring Market Makers

Blue Sky, Form 211, Regulation A, Regulation A Secondary Sales, Regulation A Tier 2, Regulation A+. Tier 1, Reporting Company, Rule 15c2-11, SEC Reporting, SEC Reporting Requirements.

Regulation A Form 1-A Offering Circular Disclosures – Going Public Lawyers

Regulation A Form 1-A Offering Statements require line item disclosure of information about the issuer and the offering. Form 1-A is subject to a full review by the SEC.

SEC Charges Reverse Merger Shell Brokers, Tiber Creek and James Cassidy

On March 26, 2019, the Securities and Exchange Commission (SEC) announced settled actions against Reverse Merger Shell Brokers, James K. McKillop, attorney James M. Cassidy, and Cassidy’s firm Tiber Creek Corp.  The agency accused both men of acting… Read More

Restricted Legends, Removal Requirements, Rule 144 for Shells – Tradability Legal Opinions

The Securities Act of 1933, as amended (the “Securities Act”) does not require that issuers place restricted legend (“Restricted Legends” or “Restrictive Legend“) on certificates representing restricted securities.   It has become routine for public companies and private companies seeking… Read More

Can Finders Raise Money Q & A – Going Public Lawyers

Posted By Brenda Hamilton, Securities Lawyer It is not unusual for a private or public company to be approached by a person (“Finder”) who offers to locate investors in exchange for a success fee. Most finders are not registered as… Read More

What is FINRA Rule 6490? Going Public Lawyers

Complying with Rule 6490’s requirements may entail an unanticipated legal and compliance cost for  issuers and their securities attorneys, who may be unfamiliar with FINRA’s authority under 10b-17.  Additionally, many OTC Markets issuers are not prepared for the Depository Trust Company (“DTC”) review that may be prompted by the issuer’s corporate action notification.

The Distinction Between Equity Crowdfunding and Rule 506 Accredited Crowdfunding

The JOBS Act’s new rules permitting general solicitation and advertising in Rule 506 private placements became effective on September 23, and there is still some confusion about the difference between equity crowdfunding and general solicitation and advertising in… Read More

SEC Files Charges Core Performance Management LLC, RMR Asset Management Co in Municipal Bond “Flipping” and Kickback Schemes

The Securities and Exchange Commission charged two firms and 18 individuals in a scheme to improperly divert new issue municipal bonds to broker-dealers at the expense of retail investors.  According to the SEC’s complaint, the defendants – known in… Read More

JH Darbie Charged in Calissio Resources Scam – Securities Lawyer 101

    On March 27, 2018, the Securities and Exchange Commission (SEC) announced a settled administrative proceeding against broker-dealer J.H. Darbie & Co., Inc., and Robert Y. Rabinowitz, Darbie’s majority owner and CEO.  On its surface, the suit… Read More

Electronic Transaction Clearing -ETC- Charged With Repeatedly Putting Customer Assets At Risk

On March 19th the Securities and Exchange Commission announced that Electronic Transaction Clearing (ETC), a registered broker-dealer headquartered in Los Angeles, has agreed to settle charges that it illegally placed more than $25 million of customers’ securities at risk… Read More

Operation Bermuda Short In Retrospect

Many penny stocks have bad histories, or are associated with questionable players.  Only last December, convicted felon Edward Durante was civilly and criminally charged in a securities fraud and manipulation scheme he’d embarked upon immediately after leaving prison… Read More

Court Finds Leon Parvizian and His Two Companies Liable on All Counts for Oil and Gas Fraud

The Securities and Exchange Commission (SEC) announced on March 24, 2016 that a federal court in Texas found promoters of fraudulent oil and gas investments liable all counts. The Honorable Ed Kinkeade of the United States District Judge for… Read More

Keeping A Close Watch On Equity Crowdfunding

With equity crowdfunding now legal, we can expect to see the Securities & Exchange Commission (“SEC”) keeping a close watch for unregistered broker dealers and funding portals. In an administrative proceeding a few weeks ago, the SEC ordered… Read More

Oil and Gas Company and Boiler Room Operator Charged

The Securities and Exchange Commission (SEC) announced on October 1, 2015 fraud charges against an Orange County, Calif. oil and gas company, its CEO, and an Arizona-based boiler room operator. The SEC claims Commodore Financial Corporation, CEO Christopher Schlegel,… Read More

FINRA’s Disclosure Requirements In EB-5 Offerings

FINRA Rule 2040 became effective late last month and has the potential to provide increased transparency in EB-5 Offerings. Rule 2040 requires broker-dealers who sell securities in EB-5 offerings to disclose finder’s fees paid to non-registered foreign persons and receive… Read More

Steven Palladino Pleads Guilty to Criminal Contempt for Violating SEC Orders

On May 14, 2015, the Securities and Exchange Commission (SEC) announced that, Steven Palladino pled guilty to 25 counts of criminal contempt charged by the United States Attorney’s Office for the District of Massachusetts based on his repeated… Read More

SEC Issues Trading Suspensions of 25 Issuers

On April 10, 2015, the Securities and Exchange Commission (“SEC”) announced the temporary suspension of trading in the securities of the following issuers, commencing at 9:30 a.m. EDT on April 10, 2015, and terminating at 11:59 p.m. EDT… Read More

Big Apple Consulting, Mark Jablon and Mark Kaley Lose Appeal

On April 9, 2015, the U.S. Court of Appeals for the Eleventh Circuit upheld a lower court’s ruling in the U.S. Securities and Exchange Commission v. Big Apple Consulting USA Inc., MJMM Investments, LLC, Marc Jablon and Mark… Read More

SEC Charges Vadda Energy Corporation With Oil And Gas Fraud

On April 10, 2015, the Securities and Exchange Commission (“SEC”) charged Mieka Energy Corporation, and its founder and president Daro Ray Blankenship, with fraudulently offering oil and gas investments. Two of Mieka’s salesmen, Robert William Myers, Jr. and… Read More

SEC Issues Trading Suspension of eCareer Common Shares

On April 8, 2014, the Securities and Exchange Commission (“SEC”) announced the temporary trading suspension of eCareer Holdings, Inc. of Boca Raton Florida. The trading suspension was issued pursuant to Section 12(k) of the Securities Exchange Act of… Read More

OTC Markets Q & A – Going Public Lawyers

Posted By Brenda Hamilton, Securities Lawyer The OTC Markets offer several different tiers for companies to choose from when considering their services. These are the OTCQX, OTCQB and OTC Pink marketplaces.  Companies that are trading on the OTC… Read More

SEC Subpoenas 101 – Securities Attorneys

Receiving a Securities and Exchange Commission (“SEC”) subpoena is a new and uncomfortable experience for most market participants. A SEC subpoena is an indication that the Division of Enforcement is investigating potential violations of the federal securities laws. SEC subpoenas… Read More

DTC Eligibility Q & A – Creating Liquidity with Electronic Trading

Posted By Brenda Hamilton, Securities Lawyer The Depository Trust and Clearing Corporation (“DTCC”), through its subsidiaries, provides clearing, settlement and information services for securities. DTCC’s subsidiary, the Depository Trust Company (“DTC”) was created to improve efficiencies and reduce… Read More

Caledonian Securities & Caledonian Bank Seized by Cayman Officials

Posted by Brenda Hamilton, Securities and Going Public Lawyer Following an action by the Securities and Exchange Commission (SEC) last week and an asset freeze order, the Cayman Islands Monetary Authority has taken control of Caledonian Bank and Caledonian… Read More

SEC Charges Oppenheimer For Penny Stock Sales

Last week, the Securities and Exchange Commission (“SEC”) announced charges against Oppenheimer & Co. for violations of federal securities laws for improperly selling penny stocks in unregistered offerings on behalf of customers. Oppenheimer agreed to admit wrongdoing and pay $10 million to… Read More

Do I Have to Disclose Payments To a Finder?

Companies seeking capital are frequently approached by intermediaries who offer to locate investors in exchange for a fee.  Most intermediaries also known as “finders” are not registered as broker-dealers with the Securities and Exchange Commission (the “SEC”).  These… Read More

The Going Public Lawyer’s Dictionary

The Going Public Lawyer’s Dictionary was created to assist companies to become familiar with certain terms they will encounter during their going public transaction.  It is crucial that you understand and can speak the going public lingo!