 |
 |
|
|
|
|
|
|
|
| | | |
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
1
.
SEC LITIGATION RELEASE
|
EXTRACTED KEY WORDS
WALSH EXCHANGE COMMISSION JUDGEMENT ACT BROKERAGE FIRM ERIK COMPLAINT ENJOINS WALSH PERMANENT INJUNCTION DISCOVERY CAPITAL GROUP DISTRICT COURT SALES INVESTMENTS FILING NETWORK PRIMARILY UNLICENSED SALES UNLICENSED SALES AGENTS HIGH PRESSURE SALES PRESSURE SALES TACTICS MAKING MISREPRESENTATIONS GROWTH AFFILIATIONS INSTITUTIONS SAFETY WALSH MISAPPROPRIATED INVESTOR MISAPPROPRIATED INVESTOR PROCEEDS BOOKS ACCOUNT |
SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 17812 / October 29, 2002
FINAL JUDGMENTS OF PERMANENT INJUNCTION ENTERED AGAINST PRINCIPAL OF
BROKERAGE FIRM
SECURITIES AND EXCHANGE COMMISSION V. DISCOVERY CAPITAL GROUP, ERIK
WALSH, AND JOHN ABRESCH, Case No. 02-60363-CIV-HUCK (S.D. Fla., filed
March 14, 2002)
The Securities and Exchange Commission ("SEC" or the "Commission")
announced that on October 4, 2002, the United States District Court
for the Southern District of Florida entered a Judgment of Permanent
Injunction and Other Relief ("Judgment") against Erik Walsh a/k/a Erik
Hutton Masters ("Walsh"), the president and CEO of Discovery Capital
Group, Inc. ("Discovery Capital"), a broker-dealer registered with the
Commission since 1992. The Judgment against Walsh, entered by his
consent and without admitting or denying the allegations of the
Commission's Complaint, enjoins Walsh from violations of Section 17(a)
of the Securities Act of 1933 ("Securities Act") and Section 10(b) of
the Securities Exchange Act of 1934 ("Exchange Act"), and Rule 10b-5
thereunder. In addition to enjoining Walsh, the Judgment also provides
for disgorgement and the imposition of a civil money penalty, in
amounts to be determined by the Court after an evidentiary hearing,
scheduled for December 2002.
On March 14, 2002, the SEC filed an emergency action against Walsh and
others seeking to enjoin the ongoing fraudulent offering of securities
issued by Discovery Capital in the form of promissory notes and
preferred stock. The Complaint alleged that from at least June 2001
through the filing of the action, Discovery Capital raised at least
$2.7 million through the use of a network of primarily unlicensed
sales agents using high pressure sales tactics and making
misrepresentations about, among other things, Discovery Capital's
growth, its affiliations with well-known brokerage firms and other
institutions, and the safety of the investments. The Complaint further
alleged that Walsh misappropriated investor proceeds through the use
of an "off the books" account in the name of Discovery Capital.
_________________________________________________________________
Modified 10/30/2002
SNIPPETS:
|
|
|
| | | |
|
|
