Articles Posted in SEC

How is the definition of an accredited investor being expanded? The proposed rule will amend the definition of an “accredited investor” as follows: With regard to individuals, the proposed rule would add the term “spousal equivalent” to the definition of a spouse, and give accredited investor status to individuals: With regard to entities, the proposed…

How to Comply with Rule 144 as a Non-Affiliate What is Rule 144? Rule 144 under the Securities Act of 1933 is enforced by the Securities and Exchange Commission (“SEC”). When a shareholder acquires restricted securities or holds control securities, the shareholder must find an exemption from the SEC’s registration requirements in order to sell…

August 13, 2019 The Securities and Exchange Commission (“SEC”) charged Antonio Bravata, a repeat securities law violator, with securities fraud after learning that Bravata was offering securities of a company he owned and controlled while serving his sentence for another Ponzi scheme. The SEC was able to put a stop to the securities offering before…

SOn December 21, 2018, the Securities and Exchange Commission (“SEC”)announced settled charges against New York-based investment advisers American Portfolios Advisers Inc. (“APA”) and PPS Advisors Inc. (“PPS”), and PPS’s CEO Lawrence Nicholas Passaretti. The advisers selected mutual fund share classes inconsistent with their client disclosures. As a result, the firms and the CEO will pay…

On November 29, 2018, the Securities and Exchange Commission (“SEC”) charged two celebrities with unlawfully touting initial coin offerings (“ICOs”). This is the first time that the SEC has brought touting violation charges involving ICOs. Professional boxer, Floyd Mayweather Jr. and music producer Khaled Khaled, commonly known as DJ Khaled, each received cease and desistorderswith…

What to do When You Are Flagged by the SEC and Receive an SEC Subpoena By Whitney De Agostini, Esq. April 1, 2019 You are literally minding your business when you are slapped with a subpoena or inquiry from the SEC. Why is the SEC investigating me, and what happens now? The SEC reached out…

The Securities and Exchange Commission (“SEC”) charged a public company promoter and his company with conducting a scheme to manipulate trading in at least 97 penny stocks. According to the SEC’s complaint filed November 28, 2018, Eric Landis arranged with third party advertisers forpublicly traded, small, often relatively infrequently traded, companies (“microcap” companies) to distribute…

On December 21, the SEC instituted its first enforcement actions against robo-advisers when they issued orders against Redwood City, a California-based Wealthfront Advisers LLC and Hedgeable Inc., a New York City-based robo-adviser. Robo-advisers provide software-based, automated portfolio management services. The enforcement actions took place because the advisers published misleading advertising and made false statements about…

Drafted by Commissioner Huston Thompson of the Federal Trade Commission (FTC), this was the first securities bill presented to Congress. It proposed “merit regulation” of the securities being submitted for public purchase. “Merit Regulation” called to bring in the government to determine the reliability of the securities that were being sold. Of the many bills…

The Securities and Exchange Commission suspended trading in the securities of Nevada-basedAmerican Retail Group, Inc. (aka Simex, Inc.) after they claimed to be partnered with an SEC qualified custodian for use with cryptocurrency transactions in two August 2018 press releases. The releases reported that the cryptocurrency transactions would be “under SEC Regulations,” and that Simex,…