Monday, January 9, 2006
Scott Kinney, Director of Communications
PH 360.902.0517 firstname.lastname@example.org
FOR IMMEDIATE RELEASE:
STATE SETTLES SECURITIES FRAUD CASERespondent Admits Some Violations, Agrees To Pay $107,700 In Restitution
OLYMPIA, WA - The Department of Financial Institutions (DFI) entered into a Consent Order with Viktor V. Klimenko of Kirkland, Washington on January 3, 2006. Klimenko, doing business as International Supplier RA, had raised more than $65,000 from thirteen investors to support his import/export business. Klimenko raised an additional $50,000 from a single investor in New Jersey. Klimenko cooperated with the Division’s investigation, and pursuant to the Consent Order, agreed to mail restitution to all investors by January 13, 2006.
The partnership agreement Klimenko used to raise the money was not registered as a security as required by law. In addition, Klimenko represented to investors that the investment was risk-free, and failed to disclose any risks concerning the investment, including that International was operating on successive capital infusions from family members and had no secure source of capital for operations. While Klimenko admitted to offering and selling unregistered securities, he did not admit to violating the anti-fraud provisions of the Securities Act.
"Viktor Klimenko made the right decision in cooperating with our investigation, and in agreeing to repay investors,” said Michael Stevenson, Director of the Division of Securities at DFI. "By admitting to certain violations, Mr. Klimenko took responsibility for his actions and avoided more severe sanctions. We hope by publicizing this settlement that more investors will take more responsibility for their investments, and always ask questions before they invest."
In addition to the restitution, under the terms of the settlement Klimenko is prohibited from future violations of the Securities Act, fined $40,000, with $36,000 of that amount suspended based on his cooperation and future compliance with the Consent Order, and ordered to pay $3,000 to cover the costs, fees, and other expenses incurred in the investigation.
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Information about how consumers can avoid investment fraud is available on the department's website: www.dfi.wa.gov.
View the Consent Order: www.dfi.wa.gov/sd/orders/orders2006.htm.