Eman93
4,750 posts
msg #73461
- Ignore Eman93 |
4/10/2009 11:57:16 PM
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 17137 / September 19, 2001
Securities and Exchange Commission v. Zappa International Corporation, Scott L. Simpson, Scott B. Walker, Equity Management Services, Eagle Vision Holdings Inc., Wayne Nattrass, and Westminster Trading Trust, Civil Action No. 98-CV-213-B (USDC Wyo.)
On December 29, 1999, the Commission obtained final judgments against defendants Scott L. Simpson, Zappa International Corporation, and Westminster Trading Trust, all formerly located in Richmond, Texas, and Eagle Vision Holdings Inc. and Wayne L. Nattrass, both formerly located in the Seattle, Washington area, which permanently enjoined the defendants from violating the anti-fraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. The United States District Court for the District of Wyoming ordered Simpson, Zappa and Westminster to jointly and severally pay disgorgement of $5,802,657 plus prejudgment interest of $630,267, and ordered Nattrass and Eagle Vision to jointly and severally pay disgorgement of $2,405,789 plus prejudgment interest of $209,012. The Commission alleged the defendants raised these funds from investors through the fraudulent sale of investments in trading programs that supposedly purchased prime bank instruments, by falsely offering guaranteed returns exceeding 200 percent per month, falsely claiming the programs were sponsored by the Federal Reserve Bank and the International Monetary Fund, and falsely representing that investors apostrophe funds were guaranteed against risk of loss by the top twenty-five world banks. The defendants consented to entry of the final judgments without admitting or denying the allegations in the Commission's amended complaint.
On March 3, 2000, the District Court entered a final judgment against defendants Scott B. Walker and Equity Management Services of Afton, Wyoming, which permanently enjoined the defendants from violating the anti-fraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. Based on the defendants' default the Court found that Walker and Equity Management had made false statements in connection with the sales of interests in a fictitious trading program of prime bank instruments. The Court found that Walker had no basis for his statements about the prime bank program because he did not obtain a bank guarantee of investors' funds; he did not know the persons trading the funds; had he inquired, he would have learned that the International Monetary Fund does not license traders and neither the International Chamber of Commerce nor the Federal reserve participates in nor approves prime bank instrument trading programs; he had no basis to claim returns of 50 to 100 percent per trade; and he did not disclose that he received a commission of 10 to 20 percent and used investors' funds to pay his personal expenses. Walker's actions and knowledge were attributed to Equity Management, because he acted as its trustee and agent. The Court ordered Walker and Equity Management to jointly and severally pay disgorgement of $220,000, which were the funds they had raised from investors, plus prejudgment interest of $27,049.
On September 30, 1999, the Court appointed a receiver to take control of the defendants' assets and collect funds for distribution back to the investors. The receiver is preparing a distribution plan to be approved by the Court.
On December 28, 1999, in the related criminal case based upon the same conduct, defendants Scott Simpson and Wayne Nattrass each pled guilty to one count of conspiracy to commit securities fraud and wire fraud, and Scott Walker pled guilty to one count of wire fraud. U.S. v. Scott B. Walker d/b/a Equity Management Services, Scott L. Simpson d/b/a Zappa International Corporation, and Wayne L. Nattrass d/b/a/ Eagle Vision Holdings Inc., Case No. 99-CR-009B (D. Wyo.).
http://www.sec.gov/litigation/litreleases/lr17137.htm
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