 UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
LITIGATION RELEASE NO. 17289 / December 21, 2001
SECURITIES
AND EXCHANGE COMMISSION v. EARL A. ABBOTT, RICHARD
L. STALVEY, GLENN PERDUE, ROBERT E. GERWIN, KENNETH
C. NUNN AND THOMAS J. O'KEEFFE (United States
District Court for the Middle District of Florida,
C.A. No. 6:01-CV-364-ORL-31-KRS)
The
Commission announced today that on December 13,
2001, a judgment by consent was entered in the
United States District Court for the Middle District
of Florida against Glenn Perdue of Indianapolis,
Indiana. The Commission's complaint in the matter,
filed on March 22, 2001, alleged that Perdue acted
as a sales agent for Earl A. Abbott, a Titusville,
Florida businessman by selling $3 million of non-existent
prime bank securities to investors. Perdue, the
complaint alleged, entered into joint venture
agreements promising investors a weekly return
of 2% over forty weeks, or 80%. The complaint
alleged that Perdue told investors that the profits
would be earned by trading in "medium term
bank debentures" of the "top 25'' western
European Banks. Further, the complaint alleged
that Perdue assured investors that Abbott was
honest and trustworthy, and told them Abbott had
invested $1 million of his own funds in the purportedly
risk-free trading program. The Commission further
alleged there were no bank debentures and no trading
and that Perdue made material misrepresentations
to his investors concerning: (i) the existence
of the trading program; (ii) the use of investor
funds; (iii) the promised return; and (iv) the
safety of the funds invested.
Defendant
Perdue has agreed, without admitting or denying
the Commission's allegations, to settle the action
by agreeing to the entry of an injunction against
future violations of the securities and broker-dealer
registration provisions as well as the general
antifraud provisions of the federal securities
laws. The Commission's complaint did not allege
that Perdue received any sales commission or profits
and accordingly, the Commission did not seek disgorgement.
Based on Perdue's sworn representations in his
statement of financial condition and other documents
submitted to the Commission, the Commission is
not imposing a civil monetary penalty against
Perdue.
The
Commission's complaint alleged that, in connection
with this scheme, Perdue engaged in transactions,
acts, practices and courses of business which
constituted violations of Section 17(a) of the
Securities Act of 1933 ("Securities Act"),
Section 10(b) of the Exchange Act of 1934 ("Exchange
Act"), and Rule 10b-5 thereunder, Section
5(a) and 5(c) of the Securities Act and Section
15(a) of the Exchange Act. The Commission's litigation
continues against Abbott and the purported London,
England program manager, Kenneth C. Nunn, as well
the purported prime bank trader, Thomas J. O'Keeffe
of Ireland, who was named as a relief defendant.
from:
http://www.sec.gov/litigation/litreleases/lr17289.htm
UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
LITIGATION RELEASE NO. 17198 / October 19, 2001
SECURITIES
AND EXCHANGE COMMISSION v. EARL A. ABBOTT, RICHARD
L. STALVEY, GLENN PURDUE, KENNETH C. NUNN AND
THOMAS J. O'KEEFFE (United States District Court
for the Middle District of Florida, C.A. No. 6:01-CV-364-ORL-31-KRS)
The
Commission announced today that on October 9,
2001, a judgment by default was entered in United
States District Court for the Middle District
of Florida against Robert E. Gerwin of Cincinnati,
Ohio. The Commission's complaint in the matter,
filed on March 22, 2001, alleged that Gerwin acted
as a sales agent for Earl A. Abbott, a Titusville,
Florida businessman by selling $300,000 of non-existent
prime bank securities to investors. Gerwin, the
complaint alleged, entered into a joint venture
agreement promising the investors a weekly return
of 16% over forty weeks, or 640%. Gerwin allegedly
told the investors that the profits would be earned
by trading in "medium term bank debentures"
of the "top 25" western European Banks.
The Commission alleged there were no bank debentures
and no trading and that, as a result of Gerwin's
actions, investors lost $245,000.
The
Commission's complaint alleged that, in connection
with this scheme, Gerwin engaged in transactions,
acts, practices and courses of business which
constituted violations 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, Section 5(a) and 5(c) of the Securities
Act and Section 15(a) of the Exchange Act. The
Commission sought, and the Court entered, a Permanent
Injunction prohibiting Gerwin from violating the
securities registration, antifraud and broker-dealer
registration provisions of the Securities Act
and the Exchange Act. The Commission did not allege
that Gerwin received any sales commission or profits
and according the Commission did not seek disgorgement.
However, the Commission sought imposition of civil
monetary penalties against Gerwin pursuant to
Section 20(d) of the Securities Act and Section
21(d)(3) of the Exchange Act. The Court entered
an order requiring Gerwin to pay a monetary penalty
of $50,000.
In
an earlier related action, the Commission filed
a complaint in the United States District Court
for the District of Massachusetts against Richard
J. Briden, an Ashland, Massachusetts business
consultant alleging violations of the securities
registration, antifraud and broker-dealer registration
provisions of the federal securities laws in connection
with the offer and sale of fraudulent prime bank
securities. That complaint alleged that Briden
convinced seven investors, three of whom were
from Massachusetts, to invest in the Abbott/Gerwin
prime bank trading program. The Florida complaint
alleges that Briden found the Abbott program through
defendant Gerwin. For further information on the
Briden action, see Litigation Release No. 16134.
For further information on the Abbott/Gerwin action,
see Litigation Release No. 16940.
from:
http://www.sec.gov/litigation/litreleases/lr17198.htm
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