 UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
Litigation Release No. 17136 / September 18,
2001
SECURITIES
AND EXCHANGE COMMISSION v. KENTON CAPITAL, LTD.,
et al., Case No. 95CV00829 (D.D.C.)
DONALD
WALLACE JAILED FOR FAILURE TO COMPLY WITH COURT
ORDER TO PAY FRAUD JUDGMENT
The
Securities and Exchange Commission announced today
that on Wednesday, September 5, 2001, Donald C.
Wallace surrendered to federal authorities. Wallace
was then incarcerated as a result of a Writ of
Body Attachment issued on August 24, 2001 by Judge
Colleen Kollar-Kotelly of the United States District
Court for the District of Columbia in SEC v.
Kenton Capital, Ltd., et al. Under the terms
of the Writ, Wallace shall remain in custody until
such time as the Court discharges him.
Wallace's
incarceration resulted from his failure to comply
with a July 12, 2001 Order of Judge Kollar-Kotelly
that held Wallace in civil contempt for his failure
to satisfy a judgment the Commission obtained
on September 30, 1998. The Order required Wallace,
within thirty days of the date of the Order, either
to pay disgorgement in the amount of $265,245.10
(plus prejudgment interest in the amount of $86,665.83
and post judgment interest) and a civil penalty
in the amount of $1.2 million, or enter into an
alternate payment plan that is acceptable to the
Commission and the Court. The securities fraud
judgment in the underlying case stemmed from a
prime bank fraud perpetrated through Kenton Capital,
Ltd., an entity incorporated in the Cayman Islands
and of which Wallace was President. See also Lit.
Rel. No. 17073, July 19, 2001.
from:
http://www.sec.gov/litigation/litreleases/lr17136.htm
UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
Litigation Release No. 17073 / July 19, 2001
SECURITIES
AND EXCHANGE COMMISSION v. KENTON CAPITAL, LTD.,
et al., Case No. 95CV00829 (D.D.C.)
COURT
HOLDS DONALD WALLACE IN CONTEMPT
FOR FAILURE TO SATISFY JUDGMENT IN FAVOR OF SEC
The
Securities and Exchange Commission (the "Commission")
announced today that on July 12, 2001, Judge Colleen
Kollar-Kotelly of the United States District Court
for the District of Columbia issued an Order in
SEC v. Kenton Capital, Ltd., et al. holding
Donald C. Wallace ("Wallace") in civil
contempt for his failure to satisfy a judgment
the Commission had obtained in its favor on September
30, 1998. The July 12, 2001 Order requires Wallace,
within thirty days of the date of the order, to
either pay disgorgement in the amount of $265,245.10
(plus prejudgment interest in the amount of $86,665.83
and post judgment interest) and a civil penalty
in the amount of $1.2 million, or enter into an
alternate payment plan that is acceptable to the
Commission and the Court. Should Wallace fail
to satisfy either of these options, the Court's
order states that it will issue a bench warrant
for his arrest and he will remain incarcerated
until such time as the Court determines that he
has fully complied with all provisions of the
Court's orders.
The
securities fraud in the underlying case stemmed
from a prime bank fraud perpetrated through Kenton
Capital, Ltd., an entity incorporated in the Cayman
Islands and of which Wallace was President. As
is typical in prime bank frauds, Wallace promised
investors that they would receive large returns
with no effort on their part, with no risk to
their principal, and that repayment of their principal
was guaranteed. The Commission obtained a second
judgment against Wallace on July 24, 2000 in SEC
v. Wallace, et. al., Civ. No. 99-0120 (D.D.C).
This second securities fraud case also stemmed
from a prime bank fraud. Wallace has also failed
to satisfy the judgment in SEC v. Wallace, and
a motion for contempt filed by the Commission
is pending in that case.
For
more information about prime bank frauds, visit
the SEC's website at http://www.sec.gov/divisions/enforce/primebank.shtml.
from:
http://www.sec.gov/litigation/litreleases/lr17073.htm
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