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1
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SEC ADMINISTRATIVE PROCEEDING
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EXTRACTED KEY WORDS
SECURITIES ACT INVESTMENT COMMISSION CLIENTS SWITCHES ADVISERS ACT INVESTMENT ADVISORY ALLEGES EXCHANGE ACT STAFF ALLEGATIONS VARIABLE ANNUITY MISLEADING SALES CHARGES MISLEADING JUSTIFICATIONS MISLEADING COMPARISONS PERFORMANCES FALSE ASSURANCES DIVERSIFICATION PORTFOLIOS SWITCH RECOMMENDATION LETTERS ALLEGED FRAUDULENT PORTION CAUSED PARKINS VIOLATIONS PROMULGATED THEREUNDER REMEDIAL SANCTIONS PENALTIES |
SECURITIES AND EXCHANGE COMMISSION
SECURITIES ACT OF 1933
Release No. 7896 / September 25, 2000
SECURITIES AND EXCHANGE ACT OF 1934
Release No. 43336 / September 25, 2000
INVESTMENT ADVISERS ACT OF 1940
Release No. 1898 / September 25, 2000
ADMINISTRATIVE PROCEEDING
File No. 3-10300
The Commission has instituted public administrative and
cease-and-desist proceedings pursuant to Section 8A of the Securities
Act of 1933, Sections 15(b)(6), 19(h) and 21C of the Securities
Exchange Act of 1934, and Sections 203(f) and 203(k) of the Investment
Advisers Act of 1940 ("Advisers Act") against Raymond A. Parkins, Jr.
("Parkins"), a resident of Orlando, Florida. From at least 1993
through 1996, Parkins was president of The Parkins Investment Advisory
Corporation ("Parkins Advisory"), an investment advisory firm formerly
registered with the Commission, and The Parkins Investment Security
Corporation ("Parkins Securities"), a broker-dealer formerly
registered with the Commission. The proceedings are based upon
allegations that from at least 1993 through 1996, Parkins, on at least
24 occasions, induced his investment advisory clients to switch their
variable annuity investments by providing them with unfounded, false
and misleading justifications for the switches, including false and
misleading comparisons of the performances of certain variable
annuities and false assurances that the switches would increase the
diversification of his clients' portfolios. The staff further alleges
in the Order that Parkins, in switch recommendation letters he sent to
his clients, misrepresented or failed to inform his clients of the
sales charges associated with the switches. As a result of Parkins'
alleged fraudulent conduct, the staff alleges in the Order that his
clients incurred unnecessary sales charges of more than $168,000, and,
in some cases, lost a portion of their investment principal, and that
Parkins Securities received commissions of more than $210,000.
The staff further alleges in the Order that Parkins aided and abetted
and caused Parkins Advisory's violations of Sections 204, 206(1) and
206(1) of the Advisers Act and Rule 204-2(a)(7) promulgated
thereunder.
A hearing will be scheduled to determine whether the staff's
allegations are true, and if so, whether remedial sanctions and
penalties should be imposed against Parkins.
SNIPPETS:
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