Orders From Other Years
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Day-By-Day Gourmet, LLC, Respondent - S-07-469-07-SO01 - Statement of Charges
On December 31, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Stop Order Revoking Registration against Day-By-Day Gourmet, LLC. Day-By-Day Gourmet, LLC is the seller of franchises that entail the retail sale of deli items as well as pre-assembled meals and other items for customers to take home to finish preparing. The Statement of Charges alleges that Day-By-Day Gourmet, LLC failed to disclose in its registration documentation that its Chief Executive Officer was the subject of a previous Securities Division Consent Order (Order Number S-05-236-06-CO01 in the matter of Alternative Capital, LLC and Bradford Vorhees entered November 13, 2006) to settle allegations that he violated the investment adviser and investment adviser representative registration requirements of the Securities Act of Washington. The Securities Division intends to revoke the franchise registration of Day-By-Day Gourmet, LLC for failure to disclose the consent order. Day-By-Day Gourmet, LLC has the right to request a hearing in this matter.
A Consent Order was entered in this matter on April 22, 2008.
Peter Mooyman and PIPS, Inc. S-06-234-07-SC01-Statement of Charges and Notice of Intent to Enter Cease and Desist Order and to Charge Costs
On December 31, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Cease and Desist Order and to Charge Costs against PIPS, Inc. and Peter Mooyman. The Order alleges that in April, 2004, Mooyman offered to sell and did sell an investment in PIPS, an entity purported to be incorporated in Panama and doing business in Malaysia. The investment purported to earn 2% per day interest in a fund run by PIPS. The Statement of Charges further alleges that the offer or sale of the investment opportunity by Mooyman constitutes the offer or sale of a security as defined in the Securities Act of Washington and the offer and sale of said security is in violation of the Securities Act because no registration for such offer or sale is on file with the Securities Administrator. Further allegations include additional violations of the Securities Act by offering or selling said securities while not registered as a securities salesperson or broker-dealer in the state of Washington and that Mooyman omitted to state material facts necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading. The Securities Division intends to order that PIPS, Inc. and Peter Mooyman cease and desist from violations of the Securities Act and that they pay costs of the investigation of this matter. PIPS, Inc. and Mooyman have the right to request an administrative hearing in this matter.
A Consent Order was entered as to Peter Mooyman on June 19, 2008.
M & W Charitable Foundation, M & W Charitable Trust, The Clarke 2001 Subscriber Trust, Russell F. Kenaga, Jr. and Victor H. Clarke - S-04-187-07-TO02 - Statement of Charges
On December 28, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist against M & W Charitable Foundation, M & W Charitable Trust, The Clarke 2001 Subscribers Trust and Russell F. Kenaga, Jr. The Division alleges that from October 2000 and continuing through November 2001 Kenaga, through M & W Charitable Foundation and M & W Charitable Trust, solicited and aided in the solicitation of investors for a high-yield investment program called The Clarke 2001 Subscription Trust run by Clarke. The Securities Division further alleges that Kenaga made material misrepresentations regarding the purported investment opportunity. These misrepresentations include Kenaga’s failure to inform investors that he had been the subject of a Cease and Desist Order issued by the Oregon Department of Consumer and Business Services, Division of Finance and Corporate Securities for the offer and sale of unregistered securities in 1995. The Securities Division also alleges that investors are located in 26 states (including Washington), the District of Columbia, Australia, Canada, Chile, Egypt, Finland, France, Germany, Greece, Japan, Luxembourg, The Netherlands, Singapore, The Slovak Republic, South Africa, Spain and The United Kingdom. The Securities Division intends to order Respondents M & W Charitable Foundation, M & W Charitable Trust, The Clarke 2001 Subscribers Trust, Russell F. Kenaga, Jr. and Victor H. Clark to cease and desist from violations of the registration and anti-fraud provisions of the Securities Act. The Respondents have a right to a hearing in this matter.
EJZ Investments, LLC and Ernest J. Zoller aka Ernest Zoller, aka Ernie Zoller, dba DePesos Systems, dba Western Products Review - S-07-532-07-SC01 - Statement of Charges
On December 27, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Impose Fines and Charge Costs against EJZ Investments, LLC and Ernest J. Zoller (collectively “Respondents”). Investors were offered a share in up to a 20% annual return derived from profits to be made in real estate foreclosures. Respondents solicited Washington investors by placing advertisements on the internet through www.craigslist.org. The Statement of Charges alleges that Respondents offered unregistered securities and acted as unregistered broker-dealers or securities salespersons. The Statement of Charges further alleges that the offer and/or sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division intends to order Respondents to cease and desist from violating the Securities Act of Washington, and gives notice of its intent to collect fines and recover costs. Respondents have a right to request a hearing on the Statement of Charges.
CANUSA Capital, LLC; Ross Paterson, and Victoria Mallahan - S-07-393-07-TO01 - Summary Order
On December 27, 2007, the Securities Division entered a Summary Order to Cease and Desist and Notice of Intent to Impose Fines and Charge Costs (“Summary Order”) against CANUSA Capital, LLC; Ross Paterson; and Victoria Mallahan. (“Respondents”) for their involvement in offering investments. The Summary Order alleges that Respondents offered and sold securities in the form of investment contracts or promissory notes. The Summary Order further alleges that Respondents told investors the money would be invested in discounted real estate or the acquisition of a business. The Summary Order further alleges that Respondent Paterson was on notice that the offers and sales may have been illegal and then failed to tell investors he was the subject of an investigation and Statement of Charges issued by the Securities Division. The Summary Order further alleges that Respondents violated the registration and anti-fraud provisions of the Securities Act while offering the securities. Respondents have a right to request a hearing on the Summary Order.
A Final Order was entered in the matter of Ross Paterson on February 12, 2008.
A Final Order was entered as to Victoria Mallahan on September 9, 2008.
Coastal Publications - S-07-544-07-TO01 - Summary Order to Cease and Desist
On December 27, 2007, the Securities Division entered a Summary Order to Cease and Desist against Coastal Publications, its agents and employees (collectively “Respondents”). Respondents have been offering business opportunities to Washington residents by direct mail. Coastal Publications is not currently registered with the Washington Securities Division to offer or sell business opportunities in the state of Washington and has not previously been so registered. Coastal Publications was served with a similar Order in March, 2001. The Summary Order further alleges that it is in the public interest and for the protection of investors that the offer and/or sale of the above-described mail processing opportunity in violation of the Washington Business Opportunity Fraud Act cease. The Securities Division has ordered Respondents to immediately cease and desist from violating the Securities Act of Washington. Respondents have a right to request a hearing on the Summary Order and Statement of Charges.
Moenkopi Resources Inc., Steven Peter Kyllo and Glenn Matthew - S-07-278-07-SC01 - Statement of Charges
On December 26, 2007, the Securities Division entered a Statement of Charges against Moenkopi Resources Inc., Steven Peter Kyllo and Glenn Matthew (“Respondents”). The Securities Division alleged that from 2002 to 2005, Respondents offered and sold at least $145,000 worth of investments in a “high-yield trading program” scheme to at least four Washington investors. The Securities Division alleged that Respondents each violated RCW 21.20.010, the anti-fraud provisions of the Securities Act of Washington, by misrepresenting or by failing to disclose material facts in connection with the offer and sale of the investments. The Division seeks fines of $15,000 as to each Respondent and to recover its costs of the investigation. Respondents each have the right to request a hearing on this matter.
Rick Young - S-07-483-07-SC01 - Statement of Charges
On December 26, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Impose Fines and Charge Costs against Rick Young (“Respondent”). Respondent offered and sold an investment in a gold and/or foreign currency exchange program to a Washington resident. Respondent raised at least $6,000 from the Washington resident. The Statement of Charges alleges that Respondent offered unregistered securities and acted as an unregistered broker-dealer or securities salesperson. The Statement of Charges further alleges that the offer and sale of securities by the Respondent violated the anti-fraud provisions of the Securities Act of Washington for failure to provide material information regarding the purported investment. The Securities Division intends to order Respondent to cease and desist from violating the Securities Act of Washington, and gives notice of its intent to collect fines and recover costs. Respondent has a right to request a hearing on the Statement of Charges.
A consent order was entered in this matter on August 08, 2008.
Caobo Company and Paul Willms - S-06-188-07-CO01 - Consent Order
On December 20, 2007, the Securities Division entered into a Consent Order with Caobo Company and Paul Willms. (“Respondents”). The Securities Division had previously entered a Statement of Charges against Respondents, Order S-06-188-07-SC01. Respondents neither admitted nor denied the Findings of Fact and Conclusions of Law in entering into the Consent Order. However, it was agreed and ordered that Respondents should cease and desist from any violations of RCW 21.20.010, the anti-fraud provisions of the Securities Act of Washington; RCW 21.20.040, the registration provision; and RCW 21.20.140, the securities registration provision. Respondents each waived their right to a hearing and to judicial review of the matter.
Filter Technology of America Inc.; Cooking Oil Filtering Systems of America Inc.; and Donald E. Jacoy - S-07-372-07-SC01 - Statement of Charges
On December 14, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Impose Fines and Charge Costs against Filter Technology of America Inc.; Cooking Oil Filtering Systems of America Inc. and Donald E. Jacoy (collectively “Respondents”). Respondents offered investments in a start-up company founded to distribute and sell cooking oil filtration systems manufactured and produced by Filter Technology of Australia. Respondents raised at least $280,000 from at least 4 investors, 1 of whom was a Washington resident. The Statement of Charges alleges that Respondents offered unregistered securities and acted as unregistered broker-dealers or securities salespersons. The Statement of Charges further alleges that the offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division intends to order Respondents to cease and desist from violating the Securities Act of Washington, and gives notice of its intent to impose fines and recover costs. Respondents have a right to request a hearing on the Statement of Charges.
A Consent Order with regard to Donald E. Jacoy was issued January 19, 2010.
Partners Mortgage Corporation and Gary Lynn Craig, Respondents - S-04-245-07-CO01 - Consent Order
On December 10, 2007, the Securities Division entered a Consent Order with Partners Mortgage Corporation and Gary Lynn Craig, (“Respondents”). The Securities Division had previously entered a Statement of Charges against Respondents, Order #S-04-245-05-SC01. Respondents neither admitted nor denied the Findings of Fact and Conclusions of Law in the Consent Order. However, it was agreed and ordered that Respondents cease and desist from any violations of RCW 21.20.010, the anti-fraud provisions of the Securities Act of Washington. It was further agreed and ordered that Gary Lynn Craig should not apply for registration as a securities broker-dealer, securities salesperson, investment adviser or investment adviser representative for ten years from the date of the Consent Order. Respondents each waived their right to a hearing and to judicial review of the matter.
Wayne K. West, Paul A. Burns, Wortham Oil & Gas Enterprises, LLC, Wortham Oil & Gas aka Wortham Realty, Inc., and WOGE/WOG Ellison Well #1 Joint Venture - S-07-256-07-SC01 - Statement of Charges
On December 3, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Issue an Order to Cease and Desist, Impose Fines and Charge Costs against Wayne K. West; Paul A. Burns; Wortham Oil & Gas Enterprises, LLC; Wortham Oil & Gas aka Wortham Realty, Inc.; and WOGE/WOG Ellison Well #1 Joint Venture (collectively “Respondents”). Respondents represent that they engage in oil and gas exploration in Texas. The Statement of Charges alleges that Respondents raised $98,000 from two Washington State residents by offering and selling unregistered interests in an oil and gas drilling project located in Leon County, Texas. The Statement of Charges further alleges that certain Respondents acted as unregistered broker-dealers and/or securities salespersons. The Statement of Charges also alleges that the offer and sale of securities by Respondents violated the anti-fraud provision of the Securities Act of Washington. The Securities Division ordered Respondents to cease and desist from violating the securities registration, broker-dealer and/or securities salesperson registration and anti-fraud provisions of the Securities Act of Washington. The Securities Division gave notice of its intent to collect fines and charge costs. Respondents have a right to request a hearing on the Statement of Charges.
A Final Order was issued June 5, 2008 as to Paul A. Burns; Wortham Oil & Gas Enterprises, LLC; Wortham Oil & Gas aka Wortham Realty Inc.; WOGE/WOG Ellison Well #1 Joint Venture.
Glen Stroud, Dan Hammond, Interlake Chemicals International Ltd. Corp., S-07-293-07-SC01 - Statement of Charges
On December 3, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Issue an Order to Cease and Desist against Glen Stroud; Dan Hammond; and Interlake Chemicals International Ltd. Corp. (collectively “Respondents”). The Statement of Charges alleges that Respondents offered and sold an opportunity to market, sell and service products that prevent surfaces from being slippery when wet to two investors while not registered as a business opportunity under the Business Opportunity Fraud Act of Washington. The investors established their business opportunities in Thurston and King counties. The Statement of Charges further alleges that Respondents violated the disclosure document and anti-fraud provisions of the Business Opportunity Fraud Act of Washington in connection with the offer and sale of such business opportunities. The Securities Division intends to order Respondents to cease and desist from violating the registration, disclosure and anti-fraud provisions of the Business Opportunity Fraud Act of Washington. Respondents have a right to request a hearing on the Statement of Charges.
A consent order was entered in this matter on March 12, 2008.
Aspen Trails Ranch, LLC and Richard G. Bowen, S-07-007-07-CO01 - Consent Order
On November 29, 2007, the Securities Division entered a Consent Order with Aspen Trails Ranch, LLC and Richard G. Bowen (“Respondents”). Respondents neither admit nor deny the Findings of Fact and Conclusions of Law set forth in the Consent Order. Richard G. Bowen, a Washington resident, offered and sold $875,000 worth of limited liability company interests in Aspen Trails Ranch, LLC, a Montana limited liability company, to 12 investors. The investors’ funds were to be used for a real estate development project. The Securities Division alleges that Respondents violated the anti-fraud provisions of the Washington Securities Act by failing to disclose material risks about the investment. The Securities Division also alleges that Respondents misrepresented to some investors that their investments were “guaranteed” to double within five years. Richard G. Bowen paid $2,000 for investigative costs and Respondents each waived their right to a hearing and to judicial review.
Chum Chum Game Company, Charles Smaltz - S-06-243-07-FO01 - Final Order
On November 26, 2007, the Securities Division entered a Final Order against Chum Chum Game Company and Charles Smaltz (collectively “Respondents”). The Securities Division previously entered a Statement of Charges in the same matter on September 28, 2007. Respondents are in the business of creating and marketing board games. Respondents raised at least $354,060 from 162 investors, including at least 121 Washington residents, through the offer and sale of unregistered securities. In addition, Respondents acted as unregistered broker-dealers or securities salespersons and violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division orders Respondents to cease and desist from violating the Securities Act of Washington, and orders Chum Chum Game Company and Charles Smaltz to each pay a fine of $5,000. Respondents have a right to request judicial review of this matter.
JoAnn Jagroop and Coffee Times S-07-363-07-SC01 - Statement of Charges
On November 20, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist against JoAnn Jagroop and Coffee Times (collectively “Respondents”). The Statement of Charges alleges that Respondents advertised on the internet a franchise opportunity that involves printing and distributing a local or district edition of the Coffee Times newspaper. The Statement of Charges further alleges that Respondents offered to sell an unregistered franchise opportunity to Washington residents. The Securities Division intends to order Respondents to cease and desist from violating the registration provisions of the Franchise Investment Protection Act of Washington. Respondents have a right to request a hearing.
A consent order was entered in this matter on January 16, 2008.
High Touch Investment Corporation - S-07-287-07-CO01 - Consent Order
On November 13, 2007, the Securities Division entered a Consent Order with High Touch Investment Corporation. High Touch Investment Corporation offers a franchise opportunity called High Touch–High Tech in which franchisees provide science education programs to school-aged children. The Securities Division alleged that High Touch Investment Corporation offered and sold a High Touch–High Tech franchise while not being registered in the State of Washington. The Securities Division further alleged that High Touch Investment Corporation failed to provide the purchaser with current financial statements for the company. High Touch Investment Corporation agreed in the consent order to comply with the registration and disclosure document provisions of the Franchise Investment Protection Act in the future and to pay $500 for costs of investigation. High Touch Investment Corporation waived its right to a hearing and judicial review of the matter.
Robert Yeager; Donna Yeager - S-05-041-07-CO02 - Consent Order
On October 29, 2007, the Securities Division entered into a Consent Order with Robert Yeager and Donna Yeager (collectively “Respondents”). The Securities Division had previously entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Impose Fines, and Recover Costs (S-05-041-07-SC01) against American Enterprises, Inc.; Entertainment Funds, Inc.; The Entertainment Group Fund, Inc.; Worldwide Entertainment, Inc.; EFI No. 32 LLC; EFI No. 33 LLC; EFI No. 34 LLC; EFI No. 35 LLC; EFI No. 36 LLC; EFI No. 37 LLC; Summer 2003 LLC; Boot and Tuxedo 2003 LLC; Big Four-Oh LLC; Pinball Wizard LLC; Wuhlheide Open Air LLC; Winter 2005 LLC; “D” Dancing Worldwide LLC; Jack Utsick; Robert Yeager; and Donna Yeager on August 17, 2007. A Consent Order (S-05-041-07-CO01) was reached and entered as to the entities on October 8, 2007. Respondents Robert Yeager and Donna Yeager were in the business of selling LLC units and promissory note investments to raise funds for concerts and other entertainment events. The Division alleged that the Respondents offered and sold $3,149,217 in unregistered securities to Washington residents between 2001 and 2005. The Division further alleged that the Respondents violated the anti-fraud provisions of the Securities Act of Washington by misusing funds and failing to provide adequate disclosures to investors. Respondents neither admitted nor denied the allegations, but agreed in the Consent Order to cease and desist from violations of the registration and anti-fraud provisions of the Securities Act of Washington. Respondents waived their rights to a hearing and judicial review of the matter. The charges against Jack Utsick are still pending.
Dale E. Bohnet, Braggdisc Incorporated, and Braggdisk, Inc, S-07-006-07-SC01 - Statement of Charges
On October 11, the Securities Division entered a Statement of Charges and Notice of Intent to Enter an Order to Cease and Desist, Deny Future Registrations, Impose Fines, and Charge Costs against Dale E. Bohnet, Braggdisc Incorporated, and Braggdisk, Inc (collectively “Respondents”). Respondents engaged in the business of marketing sales presentation compact disks to mortgage and insurance companies. The Division alleged Respondents raised at least $140,000 from at least five investors, by offering and selling unregistered promissory note and ownership interest investments. The Securities Division further alleged that Respondents acted as unregistered broker-dealers or/and securities salespersons. The Division also alleged that Bohnet effected securities transactions not recorded on the regular books and records of the broker-dealers Bohnet represented. The Division also alleged that the offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Respondents have the right to request a hearing on the Statement of Charges.
A Final Order was entered in this matter on March 4, 2008.
American Enterprises, Inc.; Entertainment Funds, Inc.; The Entertainment Group Fund, Inc.; Worldwide Entertainment, Inc.; EFI No. 32 LLC; EFI No. 33 LLC; EFI No. 34 LLC; EFI No. 35 LLC; EFI No. 36 LLC; EFI No. 37 LLC; Summer 2003 LLC; Boot and Tuxedo 2003 LLC; Big Four-Oh LLC; Pinball Wizard LLC; Wuhlheide Open Air LLC; Winter 2005 LLC; and “D” Dancing Worldwide LLC - S-05-041-07-CO01 – Consent Order
On October 8, 2007, the Securities Division entered into a Consent Order with American Enterprises, Inc.; Entertainment Funds, Inc.; The Entertainment Group Fund, Inc.; Worldwide Entertainment, Inc.; EFI No. 32 LLC; EFI No. 33 LLC; EFI No. 34 LLC; EFI No. 35 LLC; EFI No. 36 LLC; EFI No. 37 LLC; Summer 2003 LLC; Boot and Tuxedo 2003 LLC; Big Four-Oh LLC; Pinball Wizard LLC; Wuhlheide Open Air LLC; Winter 2005 LLC; and “D” Dancing Worldwide LLC (collectively “Respondents”). The Securities Division had entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Impose Fines, and Recover Costs against Respondents and Jack Utsick, Donna Yeager, and Robert Yeager on August 17, 2007. Respondents were in the business of selling LLC units and promissory note investments to raise funds for concerts and other entertainment events. The Division alleged that Respondents offered and sold $3,149,217 in unregistered securities to Washington residents between 2001 and 2005. The Division further alleged that the Respondents violated the anti-fraud provisions of the Securities Act of Washington by misusing funds and failing to provide adequate disclosures to investors. Respondents neither admitted nor denied the allegations, but agreed in the Consent Order to cease and desist from violations of the registration and anti-fraud provisions of the Securities Act of Washington. Respondents waived their rights to a hearing and judicial review of the matter. The charges against Jack Utsick, Donna Yeager, and Robert Yeager are still pending.
United Business Solutions dba UBS Group, Inc.; Johnathan Ahlf - S-07-244-07-SC01 - Statement of Charges
On October 8, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter an Order to Cease and Desist against United Business Solutions dba UBS Group, Inc. and Johnathan Ahlf (collectively “Respondents”). UBS is the seller of an opportunity to operate a consulting business to recover overpaid income taxes. The Statement of Charges alleges that Respondents sold an unregistered tax recovery and related business services franchise opportunity to a Washington State resident. The Statement of Charges further alleges that Respondents failed to disclose material information concerning the franchise opportunity, Respondent Ahlf misrepresented that the franchise was registered in Washington, and Respondent Ahlf did not provide a reasonable basis upon which projections for earnings were based. The Securities Division intends to order Respondents to cease and desist from violating the registration, anti-fraud, and disclosure document provisions of the Franchise Investment Protection Act of Washington. Respondents have a right to request a hearing on the Statement of Charges.
An Amended Statement of Charges regarding this matter entered on March 10, 2008.
A Final Order regarding this matter was entered on June 18, 2009.
Chum Chum Game Company, Charles Smaltz - S-06-243-07-SC01 - Statement of Charges
On September 28, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Impose Fines, and Recover Costs against Chum Chum Game Company and Charles Smaltz (collectively “Respondents”). Respondents offered investments in a start-up company founded to create and market new board games. Respondents raised at least $354,060 from 162 investors of which at least 121 were Washington residents. The Statement of Charges alleges that Respondents offered unregistered securities and acted as unregistered broker-dealers or securities salespersons. The Statement of Charges further alleges that the offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division intends to order Respondents to cease and desist from violating the Securities Act of Washington, and gives notice of its intent to collect fines and recover costs. Respondents have a right to request a hearing on the Statement of Charges.
A Final Order was issued in this matter on November 26, 2007.
Caobo Company and Paul Willms - S-06-188-07-SC01 - Statement of Charges
On September 27, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist and To Impose Fines (“Statement of Charges”) against Caobo Company and Paul Willms. (“Respondents”). The company purports to be in real estate development. The Statement of Charges alleges that Respondents offered securities in the form of common stock to at least 15,000 potential investors in Canada and the United States, including Washington State. The Statement of Charges alleges that Respondents planned to use the proceeds of the common stock to fund the acquisition and development of Mennonite lands that were confiscated during the Communist Revolution. The Statement of Charges further alleges that Respondents violated the registration and anti-fraud provisions of the Securities Act while offering the securities. Respondents have a right to request a hearing on the Statement of Charges.
A consent order was issued in this matter on December 20, 2007.
Stephen K. Brombach; Integrity Group Insurance & Financial Services - S-07-011-07-FO01 - Final Order
On September 20, 2007, the Securities Division entered a Final Order to Cease and Desist, Bar Registrations, and Impose Fines against Stephen K. Brombach and Integrity Group Insurance & Financial Services (collectively “Respondents”). The Division previously entered a Summary Order in the same matter on August 9, 2007. Respondents raised at least $694,750 from at least 13 Washington investors, by offering and selling unregistered Real Estate Investment Trust (“REIT”) investments. The Respondents acted as unregistered broker-dealers or/and securities salespersons licensed to sell REIT’s. Brombach effected securities transactions not recorded on the regular books and records of the broker-dealer Brombach represented. The offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division orders the Respondents to cease and desist from violating the Securities Act of Washington and bars any future securities registration. The Division also orders Respondent Brombach to pay a fine of $50,000. Respondents failed to request a hearing on the Summary Order. Respondents have a right to request judicial review of this matter.
International Global Position, Inc., FyBX Corporation, John F. Riley and Robert S. Smith - S-05-121-06-CO01 - Consent Order
On September 18, 2007, the Securities Division entered into a Consent Order with Robert S. Smith. The Division previously entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist and Notice of Intent to Deny Future Registration, Impose Fines and Recover Costs against International Global Position, Inc., FyBX Corporation, John F. Riley and Robert S. Smith on January 23, 2007. A Final Order against Respondent John F. Riley was issued on March 5, 2007. The Division had alleged that the Respondent Smith offered and sold unregistered investments in IGP and FyBX to Washington state residents and violated the anti-fraud provisions of the Securities Act of Washington in connection with the offer of such securities. Respondent Smith neither admitted nor denied the allegations, but agreed to cease and desist from violations of the registration and anti-fraud provisions of the Securities Act of Washington. Respondent Smith agreed to pay a $5000 fine and agreed to a three year suspension for registration as a securities broker-dealer, securities salesperson, investment adviser, or investment adviser representative. Respondent Smith waived his right to a hearing and judicial review of the matter
Michael Paloma, Pine Canyon Enterprises, Inc. - S-05-008-07-FO01 - Final Order
On August 29, 2007, the Securities Division entered a Final Order as to Michael Paloma and Pine Canyon Enterprises, Inc. The Securities Division entered a Statement of Charges and Notice of Intent to Enter an Order to Cease and Desist, and Notice of Intent to Deny Future Registration, Impose Fines, and Recover Costs against Michael Paloma, Pine Canyon Enterprises, Inc., and Keith Robertson (S-05-008-07-SC01) on June 29, 2007. Michael Paloma and Pine Canyon Enterprises, Inc. (“Respondents”) represented to Courtside Products, Inc. (“Courtside”) that Respondents would be able to raise money and create freely trading securities for Courtside by taking it public. In exchange for taking Courtside public, Respondents received Courtside stock as payment for services. Respondents made omissions or misleading statements of material fact which tended to work a fraud on Courtside. Respondents also acted as unregistered broker-dealers or securities salespersons in the State of Washington. The Securities Division orders Respondents to cease and desist from violations of the Securities Act of Washington, and imposes a $10,000 fine on Michael Paloma and a $10,000 fine on Pine Canyon Enterprises, Inc. Respondents have a right to request judicial review of the Final Order. The charges against Keith Robertson are still pending.
Keep Rockin’ LLC and The Wedge Corporation - S-07-270-07-CO01 - Consent Order
On August 28, 2007, the Securities Division entered a Consent Order with Keep Rockin’ LLC and The Wedge Corporation. Keep Rockin’ LLC offers a franchise opportunity for operating a restaurant called The Rock Wood Fired Pizza & Spirits. The Securities Division alleged that The Wedge Corporation, the predecessor to Keep Rockin’ LLC, offered and sold a franchise opportunity prior to Keep Rockin’ LLC’s filing a registration application with the Securities Division. The Securities Division alleged that The Wedge Corporation had not provided the purchaser with the required disclosure documents. Keep Rockin’ LLC and The Wedge Corporation agreed in the consent order to comply with the registration and disclosure document provisions of the Franchise Investment Protection Act in the future. The companies agreed to pay $500 for investigation costs. The companies waived their right to a hearing in the matter and judicial review of the matter.
EZ Show, Inc., Bernie Day, and Gordon L. Powers Jr. - S-07-044-07-SC01 - Statement of Charges
On August 20, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, To Impose Fines, To Charge Costs, To Deny Investment Adviser Application, and To Deny Investment Adviser, Investment Adviser Representative, Securities Broker-Dealer, and Securities Salesperson Licenses (“Statement of Charges”) against EZ Show, Inc.; Bernie Day; and Gordon L. Powers Jr. (“Respondents”). The Respondents were engaged in a business venture involving the creation and distribution of multimedia commercials. The Statement of Charges alleges that Respondents offered and sold securities and a franchise opportunity in Washington State. The Statement of Charges further alleges that Respondents violated the registration and anti-fraud provisions of the Securities Act and the Franchise Investment Protection Act and the disclose provision of the Franchise Investment Protection Act while offering and selling the securities and the franchise opportunity. Respondents have a right to request a hearing on the Statement of Charges.
A Consent Order was entered in this matter as to Bernie Day on February 25, 2008.
A Consent Order was issued as to Gordon L. Powers on July 31, 2008
A Consent Order was entered as to EZ Show, Inc. on November 9, 2009
American Enterprises, Inc.; Entertainment Funds, Inc.; The Entertainment Group Fund, Inc.; Worldwide Entertainment, Inc.; Jack Utsick; Donna Yeager; Robert Yeager; EFI No. 32 LLC; EFI No. 33 LLC; EFI No. 34 LLC; EFI No. 35 LLC; EFI No. 36 LLC; EFI No. 37 LLC; Summer 2003 LLC; Boot and Tuxedo LLC; Summer 2003 LLC; Big Four-Oh LLC; Pinball Wizard LLC; Wuhlheide Open Air LLC; Winter 2005 LLC; and “D” Dancing Worldwide LLC - S-05-041-07-SC01 – Statement of Charges
On August 17, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Impose Fines, and Recover Costs against American Enterprises, Inc.; Entertainment Funds, Inc.; The Entertainment Group Fund, Inc.; Worldwide Entertainment, Inc.; Jack Utsick; Donna Yeager; Robert Yeager; EFI No. 32 LLC; EFI No. 33 LLC; EFI No. 34 LLC; EFI No. 35 LLC; EFI No. 36 LLC; EFI No. 37 LLC; Summer 2003 LLC; Boot and Tuxedo 2003 LLC; Big Four-Oh LLC; Pinball Wizard LLC; Wuhlheide Open Air LLC; Winter 2005 LLC; and “D” Dancing Worldwide LLC, (collectively “Respondents”). Respondents were in the business of selling LLC units and promissory note investments to raise funds for concerts and other entertainment events. The Statement of Charges alleges that Respondents offered and sold $3,149,217 in unregistered securities to Washington residents between 2001 and 2005. The Statement of Charges further alleges that the Respondents violated the anti-fraud provisions of the Securities Act of Washington by misusing funds and failing to provide adequate disclosures to investors. The Securities Division intends to order Respondents to cease and desist from violating the Securities Act of Washington, and gave notice of its intent to collect fines and recover costs. Respondents have a right to request a hearing on the Statement of Charges.
A Consent Order in the matter of Robert Yeager and Donna Yeager was entered 10-29-07.
Scott Brookshire; Stephen Vinzant - S-06-166-07-FO02 - Final Order
On August 16, 2007, the Securities Division entered a Final Order as to Scott Brookshire. The Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Impose Fines, and Recover Costs (S-06-166-07-SC01) against Scott Brookshire and Stephen Vinzant on March 12, 2007. A Final Order (S-06-166-07-FO01) was issued as to Stephen Vinzant on April 9, 2007. Respondent Brookshire offered unregistered investments in a non-profit organization which donated proceeds from the sale of used computers to charity, acted as unregistered broker-dealer or securities salesperson, and violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division orders Respondent Brookshire to cease and desist from violating the Securities Act of Washington and to pay a fine of $5,000. Respondent Brookshire has a right to request judicial review of the Final Order.
Chesterfield Mortgage Investors, Inc.; Charles M. Chesterfield; Edward M. (“Marty”) Hunter; Rosa Collins - S-07-310-07-AG01 - Order Lifting Stop Order and Suspensions
On August 14, 2007, the Securities Division entered an Order Lifting Stop Order and Suspensions against Chesterfield Mortgage Investors, Inc., Charles M. Chesterfield, Edward M. (“Marty”) Hunter, and Rosa Collins (collectively, the “respondents”). The Order was entered to lift the stop order and suspensions against the respondents contained in the Stop Order Suspending Securities Registration, Summary Order Suspending Broker-Dealer and Salesperson Registration, and Notice of Intent to Impose a Fine entered by the Securities Division on August 8, 2007 that alleged, among other things, that Chesterfield Mortgage Investors, Inc. (“Chesterfield”) had violated WAC 460-33A-110 by failing to file audited financial statements for the year ended December 31, 2006. The Order Lifting Stop Order and Suspensions was entered following Chesterfield’s filing of audited financial statements for the year ended December 31, 2006, the amendment of its general offering circular, and its payment of a $5,000 fine.
Stephen K. Brombach; Integrity Group Insurance & Financial Services - S-07-011-07-TO01 - Summary Order
On August 9, 2007, the Securities Division entered a Summary Order to Cease and Desist and Notice of Intent to Enter an Order to Bar Registrations, Impose Fines, and Charge Costs against Stephen K. Brombach and Integrity Group Insurance & Financial Services (collectively “Respondents”). The Division alleged Respondents raised at least $694,750 from at least 13 Washington investors by offering and selling unregistered investments, which Respondents misrepresented as investments in a real estate investment trust. The Securities Division further alleged that Respondents acted as an unregistered broker-dealer or securities salesperson because they were not licensed to sell real estate investment trust securities. The Division also alleged that Brombach effected securities transactions not recorded on the regular books and records of the broker-dealer Brombach represented. The Division also alleged that the offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Respondents have the right to request a hearing on the Notice and Summary Order.
A Final Order was entered in this matter on September 20, 2007.
Chesterfield Mortgage Investors, Inc; Charles M. Chesterfield; Edward M. (“Marty”) Hunter; Rosa Collins - S-07-310-07-SC-01 - Stop Order and Summary Order
On August 8, 2007, the Securities Division entered a Stop Order Suspending Securities Registration, Summary Order Suspending Broker-Dealer and Salesperson Registration, and Notice of Intent to Impose a Fine against Chesterfield Mortgage Investors, Inc., Charles M. Chesterfield, Edward M. (“Marty”) Hunter, and Rosa Collins. The Order alleges that Chesterfield Mortgage Investors, Inc., located at 1001 Fourth Ave., Ste. 3313, Seattle, WA 98154, failed to submit audited financial statements for the year ended December 31, 2006 to the Securities Division in connection with its now revoked permit to sell mortgage paper securities and to disclose its failure to do so in its general offering circular on file with the Securities Division. The Order revokes Chesterfield Mortgage Investors, Inc.’s permit to sell mortgage paper securities, its broker-dealer registration and the salesperson registrations of Charles M. Chesterfield, Edward M. (“Marty”) Hunter, and Rosa Collins. It also provides notice of the intent of the Securities Division to impose a $10,000 fine against Chesterfield Mortgage Investors, Inc. Respondents have a right to request a hearing in connection with this Order.
This order was lifted with the entry of S-07-310-07-AG01 on August 14, 2007.
Alexi Bethel - S-05-081-06-CO01 - Consent Order
On July 30, 2007 the Securities Division entered a Consent Order with Alexi Bethel vacating the Final Order (S-05-081-06-FO01) which had been issued against Bethel on July 7, 2006. The Division had entered a Statement of Charges (S‑05-081-06-SC01) against Alexi Bethel, Cardinal Capital Management, Inc., Cardinal Capital.Net, Inc. on June 7, 2006. Cardinal Capital Management, Inc. and Cardinal Capital.Net, Inc. entered into a Consent Order (S-05-081-07-CO02) with the Securities Division on June 18, 2007. The Division had alleged that the Respondent Bethel failed to disclose material information about the stock of Cardinal Capital.Net, Inc. which he sold to a Washington resident. Respondent Bethel neither admitted nor denied the allegations, but agreed to cease and desist from violations of the registration, anti-fraud, unlawful purchases, and suitability provisions of the Securities Act of Washington. Respondent Bethel paid a $5,000 fine prior to entry of the Consent Order and agreed that the Securities Division would deny any future application by Bethel for registration as a securities broker-dealer, securities salesperson, investment adviser, or investment adviser representative. Respondent Bethel waived his right to a hearing and judicial review of the matter.
Jack McDonough - Final Order of Director on Review Affirming the Initial Order - S-05-090-08-FO01
The Final Order of the Director on Review Affirming Initial Order was issued on July 25, 2007. It affirmed the initial order of the Administrative Law Judge entered February 7, 2007 which granted summary judgment to the Department of Financial Institutions as to the matters in the Securities Division’s Summary Order to Cease and Desist, S-05-090-05-TO01, issued under the Business Opportunity Fraud Act of Washington.
On September 5, 2008, Thurston County Superior Court Judge Christine Pomeroy issued an order affirming the Final Order of Director on Review of the Department of Financial Institutions.
Professional Traders Fund, LLC; Mark Swickle; Howard Berger - S-03-146-07-AG-01 - Stipulation and Order of Dismissal
On July 24, 2007, after an adjudicative hearing, the Securities Division entered a Stipulation and Order of Dismissal of as to Professional Traders Fund, LLC; Marc Swickle; and Howard Berger dismissing the charges in Statement of Charges S-03-146-05-SC01 as to those respondents.
Baby Boot Camp, LLC - S-07-039-07-CO01 - Consent Order
On July 23, 2007, the Securities Division entered into a Consent Order with Baby Boot Camp, LLC (Consent Order No. S-07-039-07-CO01). The Division alleged that the company sold franchises to four Washington residents for operation within the state prior to filing a registration application with the Securities Division. It was also alleged that Baby Boot Camp, LLC had not provided the Washington residents with a disclosure document that contained all material information about the franchise, including but not necessarily limited to, a financial statement for the company. Among other things, the company agreed in the order to comply with the registration and disclosure document provisions of the Franchise Investment Protection Act in the future and to pay $500 for costs of investigation. The company also waived its right to a hearing or other further proceedings in this matter.
American Fiber Green Products and Ken McCleave - S-05-193-07-SC02 - Statement of Charges
On June 29, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist and Impose Fines (“Statement of Charges”) against American Fiber Green Products and Ken McCleave (“Respondents”). The Statement of Charges alleges that American Fiber Green Products manufactures products out of recycled fiberglass using a patented process. The Statement of Charges further alleges that Respondents held three meetings in King County where it offered and sold shares of American Fiber Green Products to Washington residents. The Statement of Charges further alleges that Respondents violated the registration and anti-fraud provisions of the Securities Act when offering and selling the securities. Respondents have a right to request a hearing on the Statement of Charges.
Michael Paloma, Pine Canyon Enterprises, Inc., Keith Robertson - S-05-008-07-SC01 - Statement of Charges
On June 29, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter an Order to Cease and Desist, and Notice of Intent to Deny Future Registration, Impose Fines, and Recover Costs against Michael Paloma, Pine Canyon Enterprises, Inc., and Keith Robertson (“Respondents”). The Statement of Charges alleges that Respondents acted as unregistered broker-dealers or securities salesperson in the State of Washington. The Statement of Charges further alleges that Respondents represented to Courtside Products, Inc. (“Courtside”) that Respondents would be able to raise money and create freely trading securities for Courtside by taking it public in exchange for Respondents receiving Courtside stock as payment for services. The Statement of Charges alleges that Respondents made omissions or misleading statements of material fact which tended to work a fraud on Courtside in violation of the anti-fraud provision of the Securities Act of Washington. The Statement of Charges further alleges that Keith Robertson acted as an unregistered investment adviser and violated the investment adviser anti-fraud provision of the Securities Act. The Securities Division intends to order Respondents to cease and desist from violations of the Securities Act of Washington, and gives notice of its intent to collect fines, recover costs, and deny future registration to Keith Robertson. Respondents have a right to request a hearing on the Statement of Charges.
A final order was issued as to Michael Paloma and Pine Canyon Enterprises, Inc. on August 29, 2007.
A Consent Order was entered in this matter on January 10, 2008, as to Keith Robertson.
Beyond Juice, Inc., Sally Kline, and Morrie Freedman - S-07-028-07-SC01 - Statement of Charges
On June 29, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter an Order to Cease and Desist, Impose Fines and Charge Costs against Beyond Juice, Inc., Sally Kline, and Morrie Freedman (“Respondents”). The Statement of Charges alleges that Respondents raised at least $10,000 from one or more Washington residents, by offering and selling unregistered preferred and common stock in Beyond Juice, Inc., a nutrition based fast food restaurant chain. The Securities Division alleged that the Respondents acted as an unregistered broker-dealer and/or securities salesperson. The Division also alleged that the offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division gave notice of its intent to order the Respondents to cease and desist from violating the securities registration, broker-dealer and/or securities salesperson registration, and anti-fraud provisions of the Securities Act of Washington. The Securities Division intends to collect fines and charge costs. The Respondents have a right to request a hearing on the Statement of Charges.
A Final Order as to Morrie Friedman was entered on February 18, 2011.
Cardinal Capital Management, Inc. and Cardinal Capital.Net, Inc. - S-05-081-07-CO02 – Consent Order
On June 18, 2007, the Securities Division entered a Consent Order with Cardinal Capital Management, Inc. and Cardinal Capital.Net, Inc. (“Respondents”). The Securities Division had entered a Statement of Charges (S-05-081-06-SC01) against Cardinal Capital Management, Inc., Cardinal Capital.Net, Inc., and Alexi Bethel on June 7, 2006. A Final Order (S-05-081-06-FO01) was issued against Alexi Bethel on July 7, 2006. The Division alleged that Respondents sold Cardinal Capital.Net stock to a Washington resident without registering it for sale in the State of Washington. The Division further alleged that Respondents failed to disclose material information about Cardinal Capital.Net, Inc. and its stock. The Respondents neither admitted nor denied the allegations, but agreed to cease and desist from violating the registration and anti-fraud provisions of the Securities Act of Washington. Respondents waived their rights to a hearing and judicial review of this matter.
Partners Mortgage Corporation and Gary L. Craig, Respondents - S-04-245-05-SC01 - Statement of Charges
On June 13, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter an Order to Bar Securities Broker-Dealer, Securities Salesperson, Investment Adviser, Investment Adviser Representative Registration; To Cease and Desist, and To Impose Fines (“Statement of Charges”) against Partners Mortgage Corporation and Gary Craig (“Respondents”). PMC was in the business of making high-interest rate loans, secured by real estate. The Statement of Charges alleges that Respondents sold $81 million of promissory notes purportedly secured by an undivided interest in a pool of real estate secured loans. The Statement of Charges further alleges that Respondents failed to inform investors of its true financial position including its liquidity problems and its high loan default rate. The Statement of Charges further alleges that Respondents violated other antifraud provisions of the Securities Act when offering and selling the securities. Respondents have a right to request a hearing on the Statement of Charges.
A Consent Order was entered in this case on December 10, 2007.
Malibu Development Corporation; The Meridian on Bainbridge Island, LLC; CMHCEH, L.L.C.; John M. Erickson; Bruce McCurdy; Christopher M. Heins; and Michael B. Reetz - S-06-065-07-TO01 - Summary Order
On June 8, 2007, the Securities Division entered a Summary Order to Cease and Desist and Notice of Intent to Impose Fines and Charge Costs against Malibu Development Corporation; The Meridian on Bainbridge Island, LLC; CMHCEH, L.L.C.; John M. Erickson; Bruce McCurdy; Christopher M. Heins; and Michael B. Reetz, (collectively “Respondents”). The Division alleged Respondents raised at least $3 million from at least 61 investors, the majority of whom are Washington residents, by offering and selling unregistered promissory notes represented to be secured by real estate. The Securities Division further alleged that certain Respondents acted as unregistered broker-dealers or securities salespersons. The Division also alleged that the offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division orders the Respondents to cease and desist from violating the securities registration, broker dealer and/or securities salesperson registration and anti-fraud provisions of the Securities Act of Washington. The Securities Division gave notice of its intent to collect fines and charge costs. Respondents have the right to request a hearing on the Summary Order.
A Consent Order was entered with regard to Bruce McCurdy on January 27, 2010.
A Consent Order was entered as to John M. Erickson on August 6, 2008.
A Consent Order was issued June 4, 2008, as to Michael B. Reetz.
A Consent Order was entered as to Christopher Heins and CMHCEH, LLC on May 21, 2008.
Total Golf Adventures Franchise, LLC and Teen Golf Adventures, LLC - S-07-129-07-CO01 - Consent Order
On June 8, 2007, the Securities Division entered into a Consent Order with Total Golf Adventures Franchise, LLC and Teen Golf Adventures, LLC (Consent Order No. S-07-129-07-CO01). The Division alleged that an affiliate and predecessor in interest of Total Golf Adventures Franchise, LLC, Teen Golf Adventures, LLC, had offered and sold a franchise in the state of Washington prior to filing a registration application with the Securities Division and had not provided the purchaser with a disclosure document that contained all material information that was required. Among other things, the company agreed in the order to comply with the registration and disclosure document provisions of the Franchise Investment Protection Act in the future and to pay $500 for costs of investigation. The company also waived its right to a hearing or other further proceedings in this matter.
The Blind Guy, Inc. - S-07-143-07-CO01 - Consent Order
On May 31, 2007, the Securities Division entered into a Consent Order with The Blind Guy, Inc. (Consent Order No. S-07-143-07-CO01). The company does business under the name The Blind Guy Custom Window Coverings and is the seller of business opportunities to operate and service window coverings, awnings and lighting controls. The Division alleged that the company sold a franchise to an Idaho resident to be located in the state of Washington prior to filing a registration application with the Securities Division. Among other things, the company agreed in the order to comply with the registration provision of the Franchise Investment Protection Act in the future and to pay $500 for costs of investigation. The company also waived its right to a hearing and other further proceedings in this matter.
Paul Joseph Eberharter, Nor’West Properties LLC and Milestone Beneficial LLC - S-06-229-07-CO02 - Consent Order
On May 15, 2007, the Washington Securities Division entered into a Consent Order with Paul Joseph Eberharter, Nor’West Properties LLC and Milestone Beneficial LLC (“Respondents”) in which Respondents neither admit nor deny the Findings of Fact and Conclusions of Law set forth in the Consent Order. Respondents have their principal place of business in Kingston, Washington. During 2005 and 2006, the Securities Division alleged that Respondents offered and sold unregistered securities in the form of LLC membership interests. Some of the LLC membership interests were sold with newspaper advertisements that the Securities Division alleged were misleading. The LLCs were supposed to use investor funds to finance real property development projects. When offering and selling the membership interests, the Securities Division alleged that Respondents misrepresented and failed to disclose material information, including the projected return on investment and the risks of the investment. The Consent Order required Paul Joseph Eberharter to pay a fine of $12,500 and costs of $2,500. The Consent Order also revoked Respondents’ exemptions under RCW 21.20.320(9) and RCW 21.20.320(17) for five years and limited Respondents’ exemptions under RCW 21.20.320(11) to accredited investors or investors who receive a written purchase recommendation from a registered investment adviser. Respondents waived their right to a hearing and judicial review of the matter.
Federal Savings, LLC; First Bancshares, Inc.; JMA Northwest Investments, LLC; and Jeremy M. Stamper – S-07-054-07-CO01 - Consent Order
On May 14, 2007 the Securities Division entered into a Consent Order with Federal Savings, LLC; First Bancshares, Inc.; JMA Northwest Investments, LLC; and Jeremy M. Stamper, settling Summary Order to Cease and Desist, Order No. S-07-054-07-TO01, issued on March 8, 2007. The respondents neither admitted nor denied the Findings of Facts and Conclusions of Law alleged by the Securities Division and agreed to reimburse the Division $4,500 in investigative costs. The Division alleged that since January 2007 the respondents named above, using the websites www.federalsavingsllc.com, www.federalsavingssecure.com, and www.federalsavingscorp.com were soliciting investors to purchase unregistered investment certificates. The Securities Division further alleged that the websites made material misrepresentations regarding the investments offered based upon vague and misleading information. The websites were alleged to be misleading because they gave investors the impression that Federal Savings and First Bancshares were banking institutions, had significant financial backing, were affiliated with publicly traded financial institutions, had an operating history, and were insured by the Federal Deposit Insurance Corporation (“FDIC”). First Bancshares failed to disclose that it was not affiliated with the publicly traded Missouri state holding company bearing the same name. Investors might also have been misled by a reference to the FDIC on the websites and because the websites compared the returns being offered by Federal Savings versus those offered by banks. Federal Savings was not FDIC insured and was not a state or federally chartered bank.
Great Plains Financial, LLC and Mark Blakemore - S-06-173-07-FO01 - Final Order
On May 10, 2007, Entry of Findings of Fact and Conclusions of Law and Final Order to Cease and Desist and to Impose Fines against Great Plains Financial, LLC and Mark Blakemore (“Respondents”) was entered by the Securities Division. The Division, on March 12, 2007, entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist and to Impose Fines against Respondents. The Statement of Charges alleged that Respondents sold an unregistered debenture in a prime bank scheme to a married couple residing in Whatcom County, State of Washington. The Statement of Charges further alleged that Respondents violated the registration and antifraud provisions of the Securities Act when offering and selling the unregistered security. Respondents failed to request a hearing on the Statement of Charges. Respondents may seek judicial review of the matter.
Thomas Craig Harman - S-02-343-05-CO03 - Consent Order
On April 27, 2007, the Securities Division entered a Consent Order with Thomas Craig Harman, Respondent. The Division alleged that Respondent had offered or sold securities in violation of RCW 21.20.010, the anti-fraud provision of the Securities Act of Washington, by selling securities to fund the purchase of an insurance annuity for a senior citizen. Without admitting or denying any violations, Respondent agreed to cease and desist from any violation of RCW 21.20.010. Respondent paid $1,500 for investigative costs. Respondent also waived his right to a hearing and to judicial review of this matter.
Timothy Mark Matula - S-06-199-07-CO01 - Consent Order
On April 20, 2007, the Washington Securities Division entered into a Consent Order with Timothy Mark Matula, d/b/a Quantum Capital Advisors. Matula did business in Redmond, Washington. From January 1999 through March 2006, he provided investment advice for a fee of 1% of assets under management for more than 40 client accounts with approximately $7 million in assets. At that time, Matula was not registered in Washington as an investment adviser. Matula admitted that he violated RCW 21.20.040 by doing business as an unregistered investment adviser. In settlement of the matter, Matula paid a fine of $9,000. Matula waived his right to a hearing and to judicial review of the matter.
Liftport Inc. dba Liftport Group; Michael Laine - S-06-077-07-SC01 - Statement of Charges
On April 18, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter an Order to Cease and Desist, Impose Fines and Charge Costs against Liftport Inc. dba Liftport Group and Michael Laine (“Respondents”). The Statement of Charges alleges that Respondents raised at least $117,000 from at least 85 investors, nine of whom are Washington residents, by offering and selling unregistered securities in Liftport, Inc., a company formed for the purpose of developing a space elevator. The Securities Division alleged that the Respondents acted as an unregistered broker-dealer and/or securities salesperson. The Division also alleged that the offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division ordered the Respondents to cease and desist from violating the securities registration, broker-dealer and/or securities salesperson registration, and anti-fraud provisions of the Securities Act of Washington. The Securities Division gave notice of its intent to collect fines and charge costs. The Respondents have a right to request a hearing on the Statement of Charges.
A Consent Order was entered in this matter on February 16, 2010.
Foster Financial Services Inc., Linda Ora Foster and James Allen Foster; S-06-229-07-CO01 Consent Order
On April 18, 2007, the Washington Securities Division entered into a Consent Order with Foster Financial Services Inc., Linda Ora Foster and James Allen Foster (“Respondents”) in which Respondents neither admit nor deny the Findings of Fact and Conclusions of Law in the Consent Order. Foster Financial Services Inc. is a licensed Washington insurance agency that does business in Poulsbo, Washington. The Fosters are the owners of that business. During 2005 and 2006, the Securities Division alleges that Respondents offered and sold unregistered securities in the form of limited liability company membership interests. The LLCs, Nor’West Properties LLC and Milestone Beneficial LLC, were supposed to use investor funds to finance real property development projects. Some of the membership interests were sold with newspaper advertisements that the Securities Division alleged were misleading. When offering and selling the LLC membership interests, the Securities Division alleged that Respondents failed to disclose material information about the investments and made misrepresentations, including the projected return on investment and the risks of the investment. The Consent Order required Linda Foster to pay a fine of $25,000 and costs of $5,000 and required James Foster to pay a fine of $12,500 and costs of $5,000. The Consent Order also provided that Linda Foster and James Foster shall not apply to become a securities broker-dealer or securities salesperson or an investment adviser or investment adviser representative for a period of ten years from the date the Consent Order is entered. Respondents each waived their right to a hearing and to judicial review of the Consent Order.
Holiday Enterprises Inc. and Richard “Nick” Morrell (Richard J. Morrell) - S-05-227-07-CO01 - Consent Order
On April 13, 2007, the Securities Division entered into a Consent Order with Holiday Enterprises Inc. and Richard “Nick” Morrell (“Morrell”), settling as to Holiday Enterprises Inc. and Morrell the Amended Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Order No. S-05-227-07-SC02, which amended the Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Order No. S-05-227-06-SC01, against Holiday Enterprises, Inc., Richard J. Morrell aka Nick Morrell, Andrew DeVeau, and Sherri Albano. The Division alleged the Respondents were not registered to offer and sell a business opportunity in the State of Washington. The business opportunity involved the operation of a print cartridge sales and display rack business opportunity. Morrell neither admitted nor denied the Tentative Findings of Fact and Conclusions of Law as alleged by the Division in the Amended Statement of Charges. Morrell agreed to cease and desist from any violation of the Business Opportunity Fraud Act. Morrell and Holiday Enterprises Inc. waived his right to judicial review of the matter.
Ernest M. Dill, Ernest M. Dill d/b/a Investment and Estate Strategies - S-06-160-06-CO01 - Consent Order
On April 11, 2007, the Securities Division entered into a Consent Order with Ernest M. Dill and Ernest M. Dill d/b/a Investment and Estate Strategies. The Securities Division had entered a Statement of Charges against Ernest M. Dill, Investment and Estate Strategies LLC, and Ernest M. Dill d/b/a Investment and Estate Strategies on January 2, 2007 (S-06-160-07-SC01). A Final Order was entered against Investment and Estate Strategies LLC on February 26, 2007 (S-06-160-07-FO01). The Division had alleged that Mr. Dill, a registered investment adviser representative, charged an unreasonable investment advisory fee and violated a number of rules related to the operation of his investment advisory firms. In settling the matter, Mr. Dill admitted to the allegations set forth in the Statement of Charges. Mr. Dill agreed to cease and desist from violating the anti-fraud provision of the Securities Act. In addition, Mr. Dill agreed not to apply for an investment adviser or broker-dealer license for a period of five years, or an investment adviser representative or securities salesperson license for a period of three years. Dill withdrew his request for hearing and waived his right to judicial review in this matter.
Fenco USA, Inc., Ui Sup Lee - S-07-008-07-SC01 - Statement of Charges
On April 11, 2007, the Securities Division entered a Statement of Charges against Fenco USA, Inc. and Ui Sup Lee (collectively “Respondents”). The Statement of Charges alleges that Respondents sold an unregistered cigar and wine store franchise opportunity to a Washington State resident. The Statement of Charges further alleges that Respondents failed to disclose material information concerning the franchise opportunity. The Securities Division intends to order Respondents to cease and desist from violating the registration, anti-fraud, and disclosure document provisions of the Franchise Investment Protection Act of Washington. Respondents have a right to request a hearing.
A Consent Order was entered in this matter on April 23, 2008.
MCube Petroleum, Inc., Laramie Petroleum,, Inc., Diski Petroleum, LLC, Basilam Petroleum, LLC, Halmahera – Rembang, LLC, George Atwater and Robert Miracle - S-06-101-07-FO01 - Final Order
On April 10, 2007, the Securities Division entered a Final Order to Cease and Desist and Impose Fines and Charge Costs. (“Final Order”) against MCube Petroleum, Inc.; Laramie Petroleum, Inc.; Diski Petroleum, LLC; Basilam Petroleum, LLC; Halmahera – Rembang, LLC; George Atwater; and Robert Miracle (collectively “Respondents”). An Amended Statement of Charges and Summary Order, S-06-101-07-TO01, was entered on February 21, 2007. This Summary Order amended the Statement of Charges S-06-101-06-SO01 entered on December 12, 2006 against the Respondents. The Respondents acted as unregistered broker-dealers or securities salespersons. The offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division ordered Respondents to cease and desist from violating the securities registration, broker dealer and/or securities salesperson registration and anti-fraud provisions of the Securities Act of Washington as well as to pay $92,000 in fines and $75,505 in costs. The Respondents have a right to request judicial review of this matter.
Scott Brookshire; Stephen Vinzant (Stephen Vinzant) - S-06-166-07-FO01 - Final Order
On April 9, 2007, the Securities Division entered a Final Order against Stephen Vinzant. The Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Impose Fines, and Recover Costs (S-06-166-07-SC01) against Scott Brookshire and Stephen Vinzant on March 12, 2007. Respondent Vinzant offered investments in a non-profit organization which purported to donate proceeds from the sale of used computers to charity. Respondent Vinzant offered unregistered securities, acted as unregistered broker-dealer or securities salesperson, and violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division orders Respondent Vinzant to cease and desist from violating the Securities Act of Washington and to pay a fine of $5,000. Respondent Vinzant has a right to request judicial review of the Final Order. The charges against Scott Brookshire are still pending.
Resource Development International LLC Securities Salesperson: Larry Paul Johnson, Respondent – S-00-050-05-CO02 – Consent Order
On March 27, 2007, the Securities Division entered a Consent Order with former Resource Development International LLC (“RDI”) securities salesperson Larry Paul Johnson (“Johnson”) settling charges that Johnson allegedly, as an unregistered securities salesperson, offered or sold unregistered securities in the form of RDI prime bank notes. The Division also alleged that Johnson omitted material facts in the offer and sale of the RDI prime bank notes. Johnson neither admits nor denies the facts alleged. Pursuant to the terms of the Consent Order, Johnson was ordered to cease and desist from violating the registration and anti-fraud provisions of the Securities Act. Johnson was also permanently barred from being licensed as a securities professional in the state of Washington. Johnson waived his right to a hearing and further proceedings in this matter.
Robert John Mikhail - S-02-343-05-CO02 - Consent Order
On March 23, 2007, the Securities Division entered into a Consent Order with Robert John Mikhail, Respondent. The Division had alleged that Respondent offered or sold securities in violation of RCW 21.20.010, the anti-fraud provision of the Securities Act of Washington, by engaging in the sale of securities to fund the purchase of insurance annuities for three senior citizens. Without admitting or denying any violations, Respondent agreed to cease and desist from any violations of RCW 21.20.010. Respondent agreed not to offer or sell or to induce the offer, sale or purchase of any securities in Washington for at least three years from the date of the Consent Order. Respondent paid $2,500 for investigative costs. Respondent also waived his right to a hearing and to judicial review of this matter.
Jason T. Rose, Berkshire Resources LLC, Berkshire (4OL) LLP - S-06-115-06-CO01 – Consent Order
On March 15, 2007, the Securities Division entered a Consent Order with Jason T. Rose, Berkshire Resources LLC, Berkshire (4OL) LLP (collectively “Respondents”). The Division alleged that Respondents offered to sell unregistered oil and gas securities to a Washington State resident, acted as unregistered broker-dealers or securities salespersons, and violated the anti-fraud provisions of the Securities Act of Washington. In the Consent Order, Respondents agreed to cease and desist from violation of RCW 21.20.140, RCW 21.20.040, and RCW 21.20.010, and agreed to disclose the Consent Order to all potential investors. Respondents agreed to pay a fine of $5,000 and expenses of $4,000. Respondents waived their right to a hearing in the matter and judicial review of the matter.
Sherri Albano - S-05-227-07-CO02 – Consent Order
On March 13, 2007, the Securities Division entered into a Consent Order with Sherri Albano (“Albano”), settling as to Albano the Amended Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Order No. S-05-227-07-SC02, which amended the Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Order No. S-05-227-06-SC01, against Holiday Enterprises, Inc., Richard J. Morrell aka Nick Morrell, Andrew DeVeau, and Sherri Albano. The Division alleged the Respondents were unregistered to offer and sell a business opportunity in the State of Washington. The business opportunity involved the operation of a print cartridge sales and display racks business opportunity. Albano neither admitted, nor denied the Tentative Findings of Fact and Conclusions of Law as alleged by the Division in the Amended Statement of Charges. Albano agreed to cease and desist from any violation of the Business Opportunity Fraud Act. Albano waived her right to judicial review of the matter.
Scott Brookshire, Stephen Vinzant - S-06-166-07-SC01 – Statement of Charges
On March 12, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Impose Fines, and Recover Costs against Scott Brookshire and Stephen Vinzant (collectively “Respondents”). Respondents offered investments in a non-profit organization which donated proceeds from the sale of used computers to charity. The Statement of Charges alleges that Respondents offered unregistered securities and acted as unregistered broker-dealers or securities salespersons. The Statement of Charges further alleges that the offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division intends to order Respondents to cease and desist from violating the Securities Act of Washington, and gave notice of its intent to collect fines and recover costs. Respondents have a right to request a hearing on the Statement of Charges
This matter was resolved as to Scott Brookshire by the entry of a Final Order (S-06-166-07-FO02) on August 16, 2007.
This matter was resolved as to Stephen Vinzant by the entry of a Final Order (S-06-166-07-FO01) on April 9, 2007.
Great Plains Financial, LLC and Mark Blakemore - S-06-173-06-SC01 - Statement of Charges
On March 12, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist and to Impose Fines (“Statement of Charges”) against Great Plains Financial, LLC and Mark Blakemore (“Respondents”). The Statement of Charges alleges that Respondents sold an unregistered debenture in a prime bank scheme to a married couple residing in Whatcom County. The Statement of Charges further alleges that Respondents violated the registration and antifraud provisions of the Securities Act when offering and selling the unregistered security. Respondents have a right to request a hearing on the Statement of Charges.
This matter was resolved by the entry a final order on May 10, 2007.
Federal Savings, LLC; First Bancshares, Inc.; JMA Northwest Investments, LLC; and Jeremy M. Stamper S-07-054-07-TO01 - Summary Order
On March 8, 2007, the Securities Division entered a Summary Order to Cease and Desist against Federal Savings, LLC; First Bancshares, Inc.; JMA Northwest Investments, LLC; and Jeremy M. Stamper. The Division alleges that since January 2007 the respondents named above, using the websites www.federalsavingsllc.com, www.federalsavingssecure.com, and www.federalsavingscorp.com are soliciting investors to purchase investment certificates. The Securities Division further alleges that the websites are making material misrepresentations regarding the investments offered based upon vague and misleading information. The websites are misleading because they give investors the impression that Federal Savings and First Bancshares are banking institutions, have significant financial backing, are affiliated with publicly traded financial institutions, have an operating history, and are insured by the Federal Deposit Insurance Corporation (“FDIC”). First Bancshares fails to disclose that is not affiliated with the publicly traded Missouri state holding company bearing the same name. Investors may also be misled by a reference to the FDIC on the websites and because the websites compare the returns being offered by Federal Savings versus those offered by banks. Federal Savings is not FDIC insured and is not a state or federally chartered bank. Federal Savings, LLC; First Bancshares, Inc.; JMA Northwest Investments, LLC; and Jeremy M. Stamper are specifically ordered to cease and desist from violations of the registration and anti-fraud provisions of the Securities Act, pending a final determination of the matter. Respondents have a right to request a hearing.
This matter was resolved by the entry a consent order on May 14, 2007.
John A.B. Black - S-06-094-06-CO01 - Consent Order
On March 7, 2007, the Securities Division entered into a Consent Order with John A.B. Black (“Black”). The Division alleged that Black recommended the purchase and sale of variable annuities to two Washington state residents without reasonable grounds to believe the transactions were suitable. The Division further alleged that Black engaged in dishonest or unethical practices in the securities business. In settling the matter, Black neither admitted nor denied the allegations, but consented to cease and desist from violations of the Securities Act. Black agreed not to apply for a license as a securities salesperson, broker-dealer, investment adviser, or investment adviser representative in the State of Washington. Black waived his right to a hearing in this matter.
Exchange Growth League, Results Home Buyers LLC dba Exchange Growth League, and Travis Leudke - S-05-233-06-SC01 - Statement of Charges
On March 5, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist and to Impose Fines against Exchange Growth League, Results Home Buyers LLC dba Exchange Growth League, and Travis Leudke (collectively “Respondents”). The Division alleged Respondents offered and sold to at least one Washington resident an unregistered security in a real estate development scheme. The Securities Division further alleged that certain Respondents acted as unregistered broker-dealers or securities salespersons. The Division also alleged that the offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division intends to order Respondents to cease and desist from violating the securities registration, broker dealer and/or securities salesperson registration and anti-fraud provisions of the Securities Act of Washington. The Securities Division gave notice of its intent to collect fines. Respondents have the right to request a hearing on the Statement of Charges.
International Global Position, Inc., FyBX Corporation, John F. Riley and Robert S. Smith - S-05-121-07-FO01 - Final Order
On March 5, 2007, the Securities Division entered a Final Order to Cease and Desist and Recover Costs against John F. Riley. The Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist and Notice of Intent to Deny Future Registration, Impose Fines and Recover Costs against International Global Position, Inc., FyBX Corporation, John F. Riley and Robert S. Smith on January 23, 2007. The Respondent Riley offered and sold unregistered investments in IGP and FyBX to Washington state residents. The Respondent violated the anti-fraud provisions of the Securities Act of Washington in connection with the offer of such securities. The Securities Division ordered the Respondent to cease and desist from violating the Securities Act of Washington and imposed a fine of $10,000. The Respondent has a right to request judicial review of this matter. The charges against International Global Position, Inc., FyBX Corporation, and Robert S. Smith are still pending.
Lincoln Madison Alliance, LLC and Hope Tengonciang - S-05-196-06-SC01 - Statement of Charges
On March 5, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist and to Impose Fines (“Statement of Charges”) against Lincoln Madison Alliance, LLC and Hope Tengonciang (“Respondents”). The Statement of Charges alleges that Respondents offered and sold a purported bank note to an elderly Washington resident. The Statement of Charges further alleges, based on the Division’s investigation, that Respondents did not invest in any bank note of the bank they represented. The Statement of Charges further alleges that Respondents violated antifraud provisions of the Securities Act when offering and selling the securities. Respondents have a right to request a hearing on the Statement of Charges.
Northwest Financial Group and Timothy Morris - S-05-136-07-FO01 - Final Order
On February 28, 2007, the Securities Division entered a Final Order to Cease and Desist, Deny Registration, and Impose Fines and Costs S-05-136-07-FO01 (“Final Order”) against Northwest Financial Group and Timothy Morris (“Respondents”). A Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Deny Registration, and Impose Fines and Costs (“Statement of Charges”) was entered on March 15, 2006. The Statement of Charges alleged that Respondents raised $150,000 from one Washington State resident by offering and selling an unregistered investment in promissory notes secured by real estate. The investor resided in King County. The Statement of Charges further alleges that instead of using the money for promissory notes secured by real estate the money was used for personal projects such as purchasing helicopter parts. The Statement of Charges further alleged that Respondents violated the registration and anti-fraud provisions of the Securities Act of Washington in connection with the offer and sale of such securities. Respondents requested a hearing on the Statement of Charges but failed to participate in the proceeding. On February 16, 2007, the Office of Administrative Hearings issued a Default Order ordering Respondents in default pursuant to RCW 34.05.440(2) and dismissing Respondents appeal. Respondents have a right to appeal this Final Order in Superior Court.
OppenheimerFunds Distributor, Inc. Consent Order - S-04-012-07-CO01
On February 27, 2007, the Securities Division entered into a Consent Order with OppenheimerFunds Distributor, Inc. (“OFDI”), a registered broker-dealer headquartered in Colorado and New York. The Division alleged that OFDI entered into written agreements allowing select broker-dealers and investment advisers to make bulk exchanges between specific OppenheimerFunds mutual funds for client accounts. Other firms could not make bulk exchanges unless they were the broker of record on the accounts. Additionally, the Division alleged that the agreements were not disclosed in fund prospectuses or other documents distributed in the State of Washington, and that from 2000 through 2003, the bulk exchanges resulted in dilution of mutual fund returns. In settling the matter, OFDI neither admitted nor denied the allegations, but consented to cease and desist from future violations of the Securities Act and to terminate the agreements. OFDI agreed to pay $394,500 in restitution to the impacted mutual funds, and pay a $100,000 fine and $175,000 in costs to the State. Respondent OFDI voluntarily waived its rights to a hearing and to judicial review of the matter.
Investment & Estate Strategies, LLC - S-06-160-07-FO01 - Final Order
On February 26, 2007, the Securities Division entered a Final Order against Investment & Estate Strategies, LLC (“IES”) of Everett. The Order, captioned “Entry of Findings of Fact and Conclusions of Law and Final Order to Cease and Desist and Barring Future Securities Registrations” resolves, as to IES, a Statement of Charges entered January 2, 2007, against IES and its sole manager, Ernest Marion Dill. In the Final Order the Division found that IES, a registered investment adviser, charged an unreasonable fee to a client by failing to refund unearned fees that had been paid in advance, a violation of the anti-fraud provision of the Securities Act. IES is enjoined from future violations of the Securities Act and is barred from any future securities registration for five years. IES has the right to appeal the Final Order. Mr. Dill has requested an adjudicative hearing in the matter, and the case against him is continuing.
This matter was resolved as to Ernest M. Dill. by entry of a Consent Order on April 11, 2007.
MCube Petroleum, Inc., Laramie Petroleum,, Inc., Diski Petroleum, LLC, Basilam Petroleum, LLC, Halmahera – Rembang, LLC, George Atwater and Robert Miracle - S-06-101-07-TO02 - Amended Statement of Charges and Summary Order
On February 21, 2007, the Securities Division entered an Amended Statement of Charges and Summary Order to Cease and Desist and Notice of Intent to Impose Fines and Charge Costs (“Amended Statement of Charges and Summary Order”), which amended the Statement of Charges S-06-101-06-SO01 entered on December 12, 2006 against MCube Petroleum, Inc.; Laramie Petroleum, Inc.; Diski Petroleum, LLC; Basilam Petroleum, LLC; Halmahera – Rembang, LLC; George Atwater; and Robert Miracle (collectively “Respondents”). The Statement of Charges was amended because the scope of the securities offering was much greater than had been disclosed to the Division and the offerings have continued. The Division alleged Respondents raised at least $33,640,402 from at least 238 investors by offering and selling unregistered interests in oil and gas companies whose oil blocks are represented to be located in Indonesia. The Amended Statement of Charges and Summary Order alleged that certain Respondents acted as unregistered broker-dealers or securities salespersons. The Division also alleges that the offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division ordered Respondents to cease and desist from violating the securities registration, broker dealer and/or securities salesperson registration and anti-fraud provisions of the Securities Act of Washington. The Securities Division gave notice of its intent to collect fines and charge costs. Respondents have the right to request a hearing on the Amended Statement of Charges and Summary Order to Cease and Desist.
This order was amended April 10, 2007 by entry of S-06-101-07-FO01 - Final Order to Cease and Desist and Impose Fines and Charge Costs.
Mark Hopkins and Paulina Hopkins dba All American Decal Guy, All American Decal Guy, LLC, Mark Hopkins, Paulina Hopkins -S-06-103-06-CO01 - Consent Order
On January 29, 2007, the Securities Division entered into a Consent Order with Mark Hopkins and Paulina Hopkins dba All American Decal Guy, All American Decal Guy, LLC, Mark Hopkins and Paulina Hopkins (collectively “Respondents”). The Division alleged the Respondents offered and sold an unregistered franchise in the State of Washington. The franchise involves the operation of a custom decal service whereby franchisees create, apply and sell decals. The purchaser of the opportunity resided in Ferry County. The Respondents agreed to cease and desist from any violation of the Franchise Investment Protection Act. The Respondents have paid investigative costs of $510. The Respondents waived their rights to judicial review.
View the Statement of Charges entered against Mark Hopkins and Paulina Hopkins dba All American Decal Guy on December 11, 2006.
Holiday Enterprises, Inc., Richard J. Morrell aka Nick Morrell, Andrew DeVeau, and Sherri Albano - S-05-227-07-SC02 - AMENDED Statement of Charges
On January 23, 2007, the Securities Division entered an Amended Statement of Charges and Notice of Intent to Enter Order to Cease and Desist (“Amended Statement of Charges”), which amended the Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Order No. S-05-227-06-SC01 against Holiday Enterprises, Inc., Richard J. Morrell aka Nick Morrell, Andrew DeVoe, and Sherri Albano entered on November 22, 2006. The Statement of Charges is amended to reflect the correct spelling of Andrew DeVeau’s name. The Amended Statement of Charges alleges that Respondents sold a business opportunity to own a business selling computer printer ink cartridges from display racks to at least three residents of the state of Washington while not registered as a business opportunity under the Washington State Business Opportunity Fraud Act of Washington. The Amended Statement of Charges further alleges that Respondents violated the anti-fraud provision by making misrepresentations and omissions to Washington residents, including omitting support for estimated and projected earnings statements, omitting the number of business opportunities sold or leased and the number of business opportunities that have failed, and failing to provide financial statements. Respondents have a right to request a hearing on the Amended Statement of Charges.
This matter was resolved as to Sherri Albano by entry of a Consent Order on March 13, 2007.
This matter was resolved as to Richard J. (Nick) Morrell by the entry of a Consent Order, (S-05-227-07-CO01) on April 13, 2007.
International Global Positioning, Inc.; FyBX Corporation; John F. Riley; and Robert S. Smith - S-05-121-06-SC01 - Statement of Charges
On January 23, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist and Notice of Intent to Deny Future Registration, Impose Fines and Recover Costs against International Global Positioning, Inc. (“IGP”); FyBX Corporation (“FyBX”); John F. Riley (“Riley”); and Robert S. Smith (“Smith”). The Division alleged that Riley and Smith offered and sold unregistered investments in IGP and FyBX to Washington state residents. The Division further alleged that the Respondents violated the anti-fraud provisions of the Securities Act of Washington in connection with the offer of such securities. The Division also alleged that Smith effected securities transactions not recorded on the regular books and records of the broker-dealer which Smith represented. The Respondents have a right to request a hearing in this matter.
This matter was resolved by the entry of a Final Order on March 5, 2007 and a Consent Order on September 18, 2007.
Ernest Marion Dill, Investment & Estate Strategies, LLC, and Ernest Dill d/b/a Investment & Estate Strategies - S-06-160-07-SC01 - Statement of Charges
On January 2, 2007, the Securities Division entered a Statement of Charges against Ernest Dill of Everett and two of his businesses. The Statement of Charges provides notice of the Division’s intent to order Respondents to cease and desist from violations of the Securities Act, and notice of the Division’s intent to deny future securities registrations. The Division alleges that Mr. Dill, a registered investment adviser representative, and one of his companies, Investment & Estate Strategies, LLC, charged an unreasonable investment advisory fee to a client by failing to make a refund of unearned fees, a violation of the anti-fraud provision of the Securities Act. In addition, the Division alleges Mr. Dill and both his firms violated a number of rules related to the operation of his investment advisory firms. Respondents have the opportunity to request a hearing on this matter.
This matter was resolved by entry of a Final Order entered against Investment & Estate Strategies, LLC on February 26, 2007.
This matter was resolved as to Ernest M. Dill. by entry of a Consent Order on April 11, 2007.
David A. Ball dba Beacon Development Group and David A. Ball - S-05-225-06-FO01 – Final Order
On January 2, 2007, the Securities Division entered a Final Order to Cease and Desist and imposed fines and costs against David A. Ball dba Beacon Development Group and David A. Ball (collectively “Respondents”) after entering a Summary Order to Cease and Desist and Notice of Intent to Impose Fines and Charge Costs (“Summary Order” see S-05-225-06-TO01) against the Respondents on October 23, 2006. The Securities Division found that Respondents were not registered to offer and/or sell securities, as well as offered and/or sold unregistered securities to Washington residents in a real estate development endeavor. The Securities Division ordered Respondents to cease and desist from violating the registration and anti-fraud provisions of the Securities Act of Washington, as well as to pay $30,000 in fines and $5,000 in costs.