An article on U-5 Defamation: http://www.sfmslaw.com/Securities-Regulation-Corporate-Governance/U-5-Defamation.shtml
“The Supreme Court in an
Interdependent World”
(The Wall Street Journal,
9.15.15; A7)
The Supreme Court Goes
Global:
“Legal problems – human rights
violations, threats to national security, computer hacking,
environmental degradation, corporate fraud, copy-right infringement –
surface beyond our borders and may become potential threats to us at
home...the frequent presence of foreign-related issues in the court's
cases has little or nothing to do with the current political debate
about whether American courts, including the Supreme Court, should
refer in their opinions to decisions of foreign courts. Judicial
reference to foreign law and practices do not reflect the ideologies
of justices – rather they reflect a world in which cross-boundary
travel, marriage, commerce, crime, security needs and environmental
impacts have become prevalent.”
- Supreme Court Justice Stephen
Breyer
Change is the law of life. And those who look only to the past or present are certain to miss the future.
- John F. Kennedy
●●●●●●●●●●●●
A Texas attorney was sentenced to 35 months in prison and
the surrender of his law license for misleading investors with artificially
inflated stock prices of a sham company advertised to be on the verge of
launch.
Martin Cantu and his partner Jason Wynn allegedly engaged in
a $3 million conspiracy, netting about $550,000 and $2.5 million, respectively.
Cantu still faces an $800,000 penalty from the U.S. Securities and Exchange
Commission. [i]
Cantu pled guilty to conspiracy, but was also found guilty of securities
fraud for his role in the unregistered stock offering of a web-based company
that was never in a position to fulfill its promises to investors. After
selling 10 million shares for one penny each, Cantu received 300,000 shares
at no cost, just prior to a publicity campaign that included advertising in the
USA Today newspaper.[ii]
Three million mailers were also distributed
touting the company’s imminent launch, with promises of near limitless
returns on the investment. In addition to the increased demand resulting from
this publicity, the co-conspirators utilized brokerage accounts to buy shares
and create the illusion of demand, while maintaining an inflated higher share
price.[iii]
After accepting a plea deal, Wynn was sentenced to five
years of probation and $425,000 in restitution. This does not include the $11
million SEC penalty he faces.[iv]
Generally speaking, attorneys should never get personally involved with
unregistered offerings.
[i] Orzeck, K. (2015, December 15) Texas Atty Gets 3 Yrs.
For Duping Investors in $3M Web Scam [electronic format]. Retrieved from
http://www.law360.com/articles/738329
[ii] Ibid.
[iii] Ibid.
