The New Year brought a lot of attention to the markets – and with that attention came calls for the Securities and Exchange Commission (SEC) to act as enforcers.
In January, Senator Elizabeth Warren told CNBC, “To have a healthy stock market, you have to have a cop on the beat … That should be the SEC … They have to step up and get their job done.”
Towards the end of the first quarter of the year, the SEC appears to be doing just that – but the process is often cumbersome and investigations can take years before formal charges are filed.
The SEC appears to be using many of the tools at its disposal.
February brought two rounds of mass trade suspension. One day the SEC suspended 47 shares. A few days later, 15 more were abandoned. The suspensions last 14 days each. During this time, investors cannot buy or sell shares in the companies.
In early March, the SEC announced whistleblower awards totaling $ 7 million, paid to individuals on three separate occasions. You can find these press releases here, here and here.
The latest SEC actions concern indictments against individuals after years of investigation.
This SEC press release states that it “accused James Roland Jones, of Redondo Beach, Calif., Of a fraudulent operation to sell so-called” insider tips “on the dark Internet.” Jones is also being prosecuted in Florida for his alleged activities.
In another press release, the SEC states that it “received an asset freeze … to stop alleged offer fraud and embezzlement”. According to the SEC, “Tra Jay Scarlett of Colorado Springs … raised at least $ 3.2 million from investors … [for] an environmentally friendly beverage bottling and manufacturing company. “However, the SEC claimed that Scarlett” never made or bottled drinks, never opened a bank account, and never operated in any way. “
In another case, the alleged fraud reached eight numbers. In this press release, the SEC states that it “accused Jessica Richman and Zachary Apte, co-founders of uBiome Inc., a San Francisco-based private medical testing company, of defrauding investors of $ 60 million.” The couple are also being prosecuted in California.
Sometimes certain groups can be addressed. In this press release, the SEC states that members of the New Jersey Orthodox Jewish community allegedly “invested millions based on false claims about real estate investments.” The SEC claimed that Seth P. Levine raised “millions of dollars from more than 60 investors … used misleading and misrepresentation … provided investors with … false and inaccurate information … and sometimes forged signatures.” Levine is also being prosecuted in New Jersey.
The above charges are the result of investigations that began back in 2016. As we have stated several times, the wheels of justice often drag slowly.
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