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SEC LITIGATION RELEASE
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EXTRACTED KEY WORDS
INVESTORS BRINK COMPLAINT ALLEGES UNITED STATES EXCHANGE COMMISSION ENSERCO AMOUNT DEFENDANT ACT DISGORGEMENT EQUIPMENT PROFITS PREJUDGMENT PURPOSE PURCHASING OIL FIELD PIPE RESELL PORTION ANNUM RISKS ACCORDING PONZI SCHEME WHEREBY MONIES PAID PURPORTED PROFITS BRINK MISAPPROPRIATED INVESTORS FUNDS LEO SELLING ENSERCO SECURITIES |
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 15699 / April 8, 1998
SEC V. ENSERCO, INC., D/B/A ENERGY SERVICE COMPANY, ET AL.
H-97-0983 (USDC/ND TX Houston Division)
The Securities and Exchange Commission ("Commission") announced
that on April 2, 1998, the Honorable Kenneth Hoyt, United States
District Judge, entered a Final Judgment against Defendant John
P. Brink ("Brink"). Without admitting or denying the allegations
in the Commission's Complaint, Brink consented to the entry of a
permanent injunction enjoining him from future violations of the
securities registration and anti-fraud provisions found in
Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, and
Section 10(b) of the Securities Exchange Act of 1934 and Rule
10b-5 thereunder. Brink agreed to disgorgement in the amount of
$459,550.66 together with prejudgment interest in the amount of
$137,813.00. Brink's disgorgement amount was waived based on his
demonstrated financial inability to pay.
The Commission's Complaint alleged that the defendants raised
approximately $3.6 million from investors in 39 states for the
purpose of purchasing oil field equipment and pipe. Enserco was
to resell the equipment and return a portion of the profits to
investors. The Complaint alleged that investors were guaranteed
returns of up to 25% per annum, with complete security of
principal, and were told that there were no risks associated with
the investment. In fact, according to the Complaint, Brink
operated an undisclosed "Ponzi" scheme whereby monies contributed
by new investors were paid as purported profits to previous
investors. Further, the Complaint alleges that Brink
misappropriated investors' funds, and Leo and Bravo received
undisclosed commissions for their efforts in selling Enserco
securities.
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