U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 17108 / August 27, 2001
SECURITIES AND EXCHANGE COMMISSION v. ALPHA TELCOM, INC., AMERICAN
TELECOMMUNICATIONS COMPANY, INC., STRATEGIC PARTNERSHIP ALLIANCE, LLC,
SPA MARKETING, LLC, PAUL S. RUBERA, ROBERT A. MCDONALD, ROSS S.
RAMBACH and MARK E. KENNISON (D.ORE.) (CV-01-1283 HA)
The United States Securities and Exchange Commission ("Commission")
announced that on August 27, 2001, the Honorable Owen M. Panner,
United States District Judge for the District of Oregon, issued a
temporary restraining order halting an ongoing $100 million securities
fraud by Paul S. Rubera ("Rubera"), Robert A. McDonald ("McDonald"),
Ross S. Rambach ("Rambach"), Mark E. Kennison ("Kennison") and
entities controlled by them. The Court (1) granted the Commission's
application for a temporary restraining order and receiver; (2) froze
the assets of the defendants; (3) prohibited the destruction of
documents by the defendants; (4) ordered accountings from the
defendants; and (5) granted expedited discovery. A hearing on whether
a preliminary injunction should be issued against the defendants is
scheduled for September 6, 2001.
The Commission's complaint, filed today, alleges that since 1997,
Rubera, McDonald, Rambach and Kennison, and entities controlled by
them (Alpha Telcom, Inc. ("Alpha"), American Telecommunications
Company, Inc. ("ATC"), Strategic Partnership Alliance LLC ("SPA") and
SPA Marketing, LLC ("SPA Marketing")) have raised at least $100
million from over 7,000 investors nationwide, purportedly for
investments in pay telephones, and promising investors a 14% annual
return. In fact, Rubera, McDonald, Rambach and Kennison, and the
entities controlled by them, are operating a massive Ponzi-like scheme
in which Alpha and ATC's payphone operations are losing money, but the
defendants are making payments to existing investors with the money
that they obtain from new investors. In addition, the complaint
alleges that Rambach, Kennison, SPA and SPA Marketing have been acting
as unregistered brokers in connection with the offer and sale of
investments in the defendants' scheme.
The Commission obtained an order temporarily restraining the
defendants from committing securities fraud in violation of Section
17(a) of the Securities Act of 1933 ("Securities Act"), Section 10(b)
of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5
thereunder. The Court's order also temporarily restrains the
defendants from committing violations of the securities registration
provisions of Sections 5(a) and 5(c) of the Securities Act. The
Court's order further temporarily restrains Rambach, Kennison, SPA and
SPA Marketing from committing violations of the broker-dealer
SNIPPETS:
U.S. SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION v. ALPHA TELCOM, INC., AMERICAN
The Court granted the Commission's application for a temporary restraining order and
The Commission's complaint, filed today, alleges that since 1997, Rubera, McDonald, Rambach
In fact, Rubera, McDonald, Rambach and Kennison, and the entities controlled by them, are
In addition, the complaint alleges that Rambach, Kennison, SPA and SPA Marketing have been
The Commission obtained an order temporarily restraining the defendants from committing
The Court's order also temporarily restrains the defendants from committing violations of the
The Court's order further temporarily restrains Rambach, Kennison, SPA and SPA Marketing from
The Commission would like to acknowledge the assistance of the State of Oregon Division of
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