SECURITIES AND EXCHANGE COMMISSION
Litigation Rel. No. 16912 / February 28, 2001
Accounting and Auditing Enforcement Release No. 1373 / February 28,
2001
, Civil Action No. 00113-B (United States District Court for the
District of Maine, filed June 7, 2000)
The Securities and Exchange Commission announced today that James F.
Vigue and Ivy L. Gilbert, the former CEO and CFO of Firstmark Corp.,
have settled the Commission's enforcement actions against them. The
Commission's complaint alleged that Vigue and Gilbert carried out a
long-running financial fraud and stock manipulation scheme involving
the common stock of Firstmark, a Maine corporation formerly based in
Waterville, Maine. Vigue and Gilbert, residents of Waterville, Maine,
consented, without admitting or denying the allegations of the
Commission's complaint, to the entry of permanent injunctions and have
agreed to pay a total of $160,000 within eighteen months, plus
postjudgment interest, to settle this action. Pursuant to their
consents, Vigue is ordered to pay disgorgement plus prejudgment
interest in the amount of $75,000 and a civil penalty of $50,000, and
Gilbert is ordered to pay a civil penalty of $35,000. In addition,
Vigue has agreed to be barred from serving as an officer or director
of a public company. In a related consented-to administrative order,
based on the entry of the injunctions, the Commission barred Vigue
from association with any broker, dealer or investment adviser, and
barred Gilbert from association with any broker, dealer or investment
adviser, with the right to reapply for association after three years.
The Commission's complaint in (D. Maine, filed June 7, 2000), alleged
that, from 1994 until early 1997, Vigue carried out a scheme to
maintain the price of Firstmark stock at $4 per share by inflating
Firstmark's assets and income in financial statements filed with the
Commission, and by effecting manipulative transactions in client and
customer accounts of Firstmark's broker-dealer and investment adviser
subsidiaries. The complaint alleged that Vigue discouraged or
prevented investors from selling their Firstmark stock; used nominee
accounts to purchase Firstmark stock; effected trades where no real
change in ownership took place ("wash sales"); and made purchases near
the end of the trading day in order to increase Firstmark's stock
price (known as "marking the close"). The complaint alleged that when
the manipulation scheme collapsed, in early 1997, the price of
Firstmark stock declined from approximately $4 to less than $1. On
April 27, 1999, Firstmark stock was delisted from the NASDAQ SmallCap
market. Many of Firstmark's approximately 650 shareholders are
residents of the Waterville, Maine area.
SNIPPETS:
The Securities and Exchange Commission announced today that James F. Vigue and Ivy L.
The Commission's complaint alleged that Vigue and Gilbert carried out a long-running
Vigue and Gilbert, residents of Waterville, Maine, consented, without admitting or denying
Pursuant to their consents, Vigue is ordered to pay disgorgement plus prejudgment interest in
In a related consented-to administrative order, based on the entry of the injunctions, the
Maine, filed June 7, 2000), alleged that, from 1994 until early 1997, Vigue carried out a
The complaint alleged that Vigue discouraged or prevented investors from selling their
The complaint further alleged that Gilbert and Vigue inflated Firstmark's assets and income
The complaint also alleged that Gilbert aided and abetted Vigue's manipulation scheme by
The complaint also alleged that Vigue violated the margin requirements set forth in Section
The complaint further alleged that, as the control person of Firstmark's brokerage firm,
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