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1
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SEC ADMINISTRATIVE LAW JUDGE DECISION
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EXTRACTED KEY WORDS
INVESTMENT ADVISER ZION SECURITIES TRADES TRADING INVESTORS EXCHANGE COMMISSION ADVISERS ACT RESPONDENTS ZION CAPITAL MANAGEMENT DOMINION LAW DAM HEDGE FUND VIOLATIONS SANCTIONS CAPITAL MANAGEMENT LLC TRADING STRATEGY ADMINISTRATIVE LAW JUDGE INVESTMENT COMPANY OFFERING CIRCULAR MATERIALS REPRESENTATIONS ENFORCEMENT UNPROFITABLE TRADES MARKET WISE SMITH BARNEY QUARTERLY REPORTS |
Initial Decision of an SEC Administrative Law Judge
Zion Capital Management LLC, and Ricky A. Lang
INITIAL DECISION RELEASE NO. 220
ADMINISTRATIVE PROCEEDING
FILE NO. 3-10659
UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________________________________________________
In the Matter of
ZION CAPITAL MANAGEMENT LLC, and
RICKY A. LANG
_________________________________________________________________
INITIAL DECISION
January 29, 2003
APPEARANCES Robert M. Fusfeld and Leslie Hendrickson-Hughes for the
Division of Enforcement, Securities and Exchange Commission
Robert T. McAllister of Robert T. McAllister, PC, for Respondents Zion
Capital Management LLC and Ricky A. Lang
BEFORE Carol Fox Foelak, Administrative Law Judge
SUMMARY
This Initial Decision sanctions Zion Capital Management LLC and its
owner Ricky A. Lang, who operated a hedge fund for which Zion was the
investment adviser. Lang told investors he would operate the hedge
fund with the same trading strategy he had used successfully for
another entity in which he had a financial interest. Nonetheless, in
trading for both he allocated more unprofitable trades to the hedge
fund and more profitable trades to the second entity, with the result
that the hedge fund lost 60% of its value while the second entity
profited. Additionally, Lang discarded or failed to keep required
records of his trading. Thus, Lang and Zion violated antifraud and
record keeping provisions of the securities laws. The Initial Decision
fines Respondents $220,000, orders them to disgorge $211,827 of
ill-gotten gains, bars Lang from working as an investment adviser, and
imposes cease-and-desist orders.
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