In re PAUL JOHN MCCABE

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 UNITED STATES OF AMERICA 
 Before the 
 SECURITIES AND EXCHANGE COMMISSION 
 
SECURITIES EXCHANGE ACT OF 1934 
Release No. 102230 / January 17, 2025 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-22431 
 
In the Matter of 
 
PAUL JOHN MCCABE, JR. 
AND PMAC CONSULTING, 
LLC  
 
Respondents. 
 
ORDER INSTITUTING ADMINISTRATIVE 
AND CEASE-AND-DESIST PROCEEDINGS, 
PURSUANT TO SECTIONS 15(b) AND 21C 
OF THE SECURITIES EXCHANGE ACT 
OF 1934, MAKING FINDINGS, AND 
IMPOSING REMEDIAL SANCTIONS AND 
A CEASE-AND-DESIST ORDER  
 
I. 
 
 The Securities and Exchange Commission (“Commission”) deems it appropriate and in the 
public interest that public administrative and cease-and-desist proceedings be, and hereby are, 
instituted pursuant to Sections 15(b) and 21C of the Securities Exchange Act of 1934 (“Exchange 
Act”) against Paul John McCabe, Jr. (“McCabe”) and PMAC Consulting, LLC (“PMAC,” and 
collectively with McCabe, “Respondents”).   
 
II. 
 
 In anticipation of the institution of these proceedings, Respondents have submitted an Offer 
of Settlement (the “Offer”) which the Commission has determined to accept. Solely for the purpose 
of these proceedings and any other proceedings brought by or on behalf of the Commission, or to 
which the Commission is a party, and without admitting or denying the findings herein, except as 
to the Commission’s jurisdiction over them and the subject matter of these proceedings, which are 
admitted, and except as provided herein in Section V as to McCabe, Respondents consent to the 
entry of this Order Instituting Administrative and Cease-and-Desist Proceedings, Pursuant to 
Sections 15(b) and 21C of the Securities Exchange Act of 1934, Making Findings, and Imposing 
Remedial Sanctions and a Cease-and-Desist Order (“Order”), as set forth below. 
 

 2 
III. 
 
 On the basis of this Order and Respondents’ Offer, the Commission finds
1
 that: 
 
Summary 
 
 These proceedings arise out of unregistered broker activity by McCabe, conducted through 
his solely-owned entity, PMAC.  Until October 2016, McCabe was a registered representative 
associated with broker-dealers registered with the Commission.  In December 2016, McCabe 
consented to a permanent bar by the Financial Industry Regulatory Authority (“FINRA”) from 
acting as a broker or otherwise associating with a registered broker-dealer.  From October 2016 
through June 2023, McCabe continued to broker securities transactions between holders of shares of 
stock in private companies that were expected to go public through an initial public offering (“Pre-
IPO Shares”) and funds seeking to acquire such Pre-IPO Shares.  Between October 2018 and June 
2023, McCabe received more than $16 million in transaction-based compensation through PMAC 
for unregistered broker activity on behalf of several fund clients and nearly 100 sellers.  McCabe 
and PMAC acted as unregistered brokers in violation of Section 15(a) of the Exchange Act in 
connection with these securities transactions.     
 
Respondents 
 
 1. McCabe (CRD No. 2751063), age 56, resides in Bethesda, Maryland.  McCabe 
previously held Series 6, 7, 63, and Securities Industry Essentials licenses.  From 1996 through 
October 2016, McCabe was associated with six different registered broker-dealers.  In December 
2016, McCabe consented to a permanent bar by FINRA for failing to provide information and 
documents requested by FINRA in connection with an examination of the registered broker-dealer 
with which he was then associated.  Since October 2016, McCabe has not been associated with a 
registered broker-dealer. 
 
 2. PMAC is a single-member managed limited liability corporation established by 
McCabe in Michigan on October 13, 2016, with its principal place of business in Bethesda, 
Maryland.  McCabe is the sole owner and manager of PMAC.  From October 2016 through June 
2023, McCabe conducted his unregistered broker activities primarily through the PMAC entity, and 
buyers and sellers of Pre-IPO Shares executed fee agreements with PMAC and paid PMAC 
transaction-based compensation in connection with this unregistered broker activity. 
 
 
Background 
3. From March 2009 through October 2016, McCabe was at various times associated 
with five different registered broker-dealers (the “Registered Broker-Dealers”) specializing in 
transactions in Pre-IPO Shares.  While so associated, he met potential buyers and sellers of Pre-
 
1
  The findings herein are made pursuant to Respondents’ Offer of Settlement and are not 
binding on any other person or entity in this or any other proceeding. 
 

 3 
IPO Shares by using websites, attending conferences, and word of mouth.  He then connected 
potential buyers and sellers looking to transact in Pre-IPO Shares.  Upon successful completion of 
a transaction brokered by McCabe, the seller paid transaction-based compensation in the form of a 
percentage of the sale to the Registered Broker-Dealers, from which McCabe’s compensation was 
derived.  
4. During McCabe’s tenure at one of the Registered Broker-Dealers, McCabe used a 
fee agreement form for transactions in Pre-IPO Shares that he brokered (the “Registered Broker-
Dealer Fee Agreement”).  The Registered Broker-Dealer Fee Agreement included certain provisos 
including one specifying: “[Registered Broker-Dealer] represents and warrants that it is a 
registered broker-dealer under Section 15 of the Securities Exchange Act of 1934, as amended, and 
has appropriate state licenses to provide the services and receive the fees hereunder.”  The 
language of the Registered Broker-Dealer Fee Agreement of the last two Registered Broker-
Dealers with which McCabe was associated stated “[Registered Broker-Dealer] is a registered 
broker dealer.”   
5.  In October 2016, as part of a FINRA examination of the last Registered Broker-
Dealer with which McCabe was affiliated, FINRA requested that McCabe produce certain 
information and documents.  Rather than do so, McCabe decided to leave that Registered Broker-
Dealer and terminate his FINRA registration, which eliminated his obligation to produce 
documents and information.  On October 14, 2016, McCabe resigned from his last Registered 
Broker-Dealer.  On November 17, 2016, he submitted a Letter of Acceptance, Waiver, and 
Consent (“AWC”) to FINRA, in which he consented to a bar from associating with any FINRA 
member firm in any capacity.  FINRA accepted and entered the AWC on December 8, 2016. 
6. On October 13, 2016—the day before McCabe resigned from his last Registered 
Broker-Dealer—he created PMAC to continue facilitating transactions in Pre-IPO Shares, 
notwithstanding his lack of association with a registered broker-dealer and his plan to terminate his 
registration with FINRA.  Shortly before establishing PMAC, McCabe informed multiple clients 
that he would be leaving his last Registered Broker-Dealer and could be reached at his personal 
email address, adding that “nothing will change as far as business goes” and he was “still doing the 
same thing just on my own.”   
7. McCabe used a modified version of the Registered Broker-Dealer Fee Agreement 
at PMAC that he created called the PMAC Consulting Agreement, which included the number of 
shares; price per share plus “referral fee”; gross amount buyer obligation; PMAC’s fee; and seller 
proceeds as the relevant information to be input.  McCabe also included a proviso in the PMAC 
Consulting Agreement specifying that the “[f]ee is to be paid directly to PMAC Consulting by 
buyer [or seller] upon successful completion of the transaction between buyer [] and seller[.]”  
McCabe did not include the statement from the Registered Broker-Dealer Fee Agreements about 
being a registered broker-dealer. 
8. The business McCabe conducted through PMAC was a continuation of the same 
activity he previously performed as a registered representative at the Registered Broker-Dealers.  
McCabe described the work he conducted at the Registered Broker-Dealers with which he was 
associated as the same as with PMAC Consulting.  

 4 
9. Between October 2016 and June 2023, McCabe, through PMAC, negotiated the 
terms of transactions for the purchase and sale of Pre-IPO Shares, worked directly with the issuers 
of Pre-IPO Shares with respect to the mechanics of share transfers, provided purchasers with 
advice or valuations as to the merits of a particular investment, handled and submitted paperwork 
for the transactions, acted as the primary intermediary between buyers, sellers, and their agents or 
representatives, paid fees to certain issuers to effectuate closings, and actively identified and 
solicited sellers of Pre-IPO Shares in particular companies for buyers.   
10.  McCabe, through PMAC, was usually paid a percentage fee of the transaction when 
the transaction closed as compensation for his unregistered broker activities.  Between October 
2018 and June 2023, McCabe received more than $16 million in transaction-based compensation 
through PMAC for unregistered broker activity on behalf of several fund clients and nearly 100 
sellers.  McCabe received compensation from both purchasers and sellers, sometimes collecting 
fees from both sides in the same transaction.  The fees collected by McCabe through PMAC were 
typically between 3% and 5% of the total transaction price.  The transactions were typically 
documented using the PMAC Consulting Agreement.  
 
11. As a result of the conduct described above, Respondents willfully violated Section 
15(a) of the Exchange Act, which prohibits any broker or dealer from making use of the mails or 
any means or instrumentality of interstate commerce, to effect any transaction in, or induce or 
attempt to induce the purchase or sale of, any security unless the broker or dealer is registered in 
accordance with Section 15(b) of the Exchange Act or is a natural person who is associated with a 
registered broker or dealer.
 2
 
 
IV. 
 In view of the foregoing, the Commission deems it appropriate and in the public interest to 
impose the sanctions agreed to in the Respondents McCabe and PMAC’s Offer. 
 
 Accordingly, pursuant to Sections 15(b) and 21C of the Exchange Act, it is hereby 
ORDERED that: 
 
 A. Respondents McCabe and PMAC cease and desist from committing or causing any 
violations and any future violations of Section 15(a) of the Exchange Act.  
 
 
2
   “Willfully,” for purposes of imposing relief under Section 15(b) of the Exchange Act, 
“‘means no more than that the person charged with the duty knows what he is doing.’”  Wonsover 
v. SEC, 205 F.3d 408, 414 (D.C. Cir. 2000) (quoting Hughes v. SEC, 174 F.2d 969, 977 (D.C. Cir. 
1949)).  There is no requirement that the actor “also be aware that he is violating one of the Rules 
or Acts.”  Tager v. SEC, 344 F.2d 5, 8 (2d Cir. 1965).  The decision in The Robare Group, Ltd. v. 
SEC, which construed the term “willfully” for purposes of a differently structured statutory 
provision, does not alter that standard.  922 F.3d 468, 478-79 (D.C. Cir. 2019) (setting forth the 
showing required to establish that a person has “willfully omit[ted]” material information from a 
required disclosure in violation of Section 207 of the Advisers Act). 
  

 5 
B. Respondent McCabe be, and hereby is: 
 
barred from association with any broker, dealer, investment adviser, 
municipal securities dealer, municipal advisor, transfer agent, or nationally 
recognized statistical rating organization; and 
barred from participating in any offering of a penny stock, including: 
acting as a promoter, finder, consultant, agent or other person who 
engages in activities with a broker, dealer or issuer for purposes of the 
issuance or trading in any penny stock, or inducing or attempting to induce 
the purchase or sale of any penny stock.  
 C. Any application for reentry by Respondent McCabe will be made to the appropriate 
self-regulatory organization, or if there is none, to the Commission by contacting the Division of 
Enforcement’s Office of Chief Counsel at [email protected], and will be subject to the 
applicable laws and regulations governing the reentry process.  Reentry may be conditioned upon a 
number of factors, including, but not limited to, compliance with the Commission’s order and 
payment of any or all of the following:  (a) any disgorgement or civil penalties ordered by a Court 
against Respondent McCabe in any action brought by the Commission; (b) any disgorgement 
amounts ordered against Respondent McCabe for which the Commission waived payment; (c) any 
arbitration award related to the conduct that served as the basis for the Commission order; (d) any 
self-regulatory organization arbitration award to a customer, whether or not related to the conduct 
that served as the basis for the Commission order; and (e) any restitution order by a self-regulatory 
organization, whether or not related to the conduct that served as the basis for the Commission 
order. 
  
D. Respondents McCabe and PMAC shall pay a civil money penalty in the amount of 
$3,000,000.00, jointly and severally, to the Securities and Exchange Commission for transfer to the 
general fund of the United States Treasury, subject to Exchange Act Section 21F(g)(3).  Payment 
shall be made in the following installments:   
 
1. Due within 21 days of the entry of this Order:  $600,000.00; 
2. Due within 90 days of the entry of this Order:  $600,000.00; 
3. Due within 180 days of the entry of this Order:  $600,000.00; 
4. Due within 270 days of the entry of this Order:  $600,000.00; and 
5. The remainder within 360 days of the entry of this Order. 
 
Payments shall be applied first to post order interest, which accrues pursuant to 31 U.S.C. 
§ 3717.  Prior to making the final payment set forth herein, Respondents shall contact the staff of 
the Commission for the amount due.  If Respondents fail to make any payment by the date agreed 
and/or in the amount agreed according to the schedule set forth above, all outstanding payments 
under this Order, including post-order interest, minus any payments made, shall become due and 
payable immediately at the discretion of the staff of the Commission without further application to 
the Commission.   
 

 6 
Payment must be made in one of the following ways:   
 
(1) Respondents may transmit payment electronically to the Commission, 
which will provide detailed ACH transfer/Fedwire instructions upon 
request;  
 
(2) Respondents may make direct payment from a bank account via Pay.gov 
through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  
 
(3) Respondents may pay by certified check, bank cashier’s check, or United 
States postal money order, made payable to the Securities and Exchange 
Commission and hand-delivered or mailed to:  
 
Enterprise Services Center 
Accounts Receivable Branch 
HQ Bldg., Room 181, AMZ-341 
6500 South MacArthur Boulevard 
Oklahoma City, OK 73169 
 
Payments by check or money order must be accompanied by a cover letter identifying 
McCabe and/or PMAC as a Respondent in these proceedings, and the file number of these 
proceedings; a copy of the cover letter and check or money order must be sent to Associate 
Regional Director Sheldon Pollock, Division of Enforcement, Securities and Exchange 
Commission, 100 Pearl Street, Suite 20-100, New York, NY 10004-2616. 
 
 E. Amounts ordered to be paid as civil money penalties pursuant to this Order shall be 
treated as penalties paid to the government for all purposes, including all tax purposes.  To 
preserve the deterrent effect of the civil penalty, Respondents agree that in any Related Investor 
Action, they shall not argue that they are entitled to, nor shall they benefit by, offset or reduction of 
any award of compensatory damages by the amount of any part of a Respondent’s payment of a 
civil penalty in this action (“Penalty Offset”).  If the court in any Related Investor Action grants 
such a Penalty Offset, Respondents agree that they shall, within 30 days after entry of a final order 
granting the Penalty Offset, notify the Commission's counsel in this action and pay the amount of 
the Penalty Offset to the Securities and Exchange Commission.  Such a payment shall not be 
deemed an additional civil penalty and shall not be deemed to change the amount of the civil 
penalty imposed in this proceeding.  For purposes of this paragraph, a “Related Investor Action” 
means a private damages action brought against a Respondent by or on behalf of one or more 
investors based on substantially the same facts as alleged in the Order instituted by the 
Commission in this proceeding. 
 
V. 
It is further Ordered that, solely for purposes of exceptions to discharge set forth in Section 
523 of the Bankruptcy Code, 11 U.S.C. § 523, the findings in this Order are true and admitted by 
Respondent McCabe, and further, any civil penalty or other amounts due by Respondent McCabe 
under this Order or any other judgment, order, consent order, decree or settlement agreement 

 7 
entered in connection with this proceeding, is a debt for the violation by Respondent McCabe of 
the federal securities laws or any regulation or order issued under such laws, as set forth in Section 
523(a)(19) of the Bankruptcy Code, 11 U.S.C. § 523(a)(19). 
 
 
 By the Commission. 
 
 
 
Vanessa A. Countryman 
       Secretary 
 
 
 

UNITED STATES OF AMERICA 

 Before the 

 SECURITIES AND EXCHANGE COMMISSION 

 

SECURITIES EXCHANGE ACT OF 1934 

Release No. 102230 / January 17, 2025 

 

ADMINISTRATIVE PROCEEDING 

File No. 3-22431 

 

In the Matter of 

 

PAUL JOHN MCCABE, JR. 

AND PMAC CONSULTING, 

LLC  

 

Respondents. 

 

ORDER INSTITUTING ADMINISTRATIVE 

AND CEASE-AND-DESIST PROCEEDINGS, 

PURSUANT TO SECTIONS 15(b) AND 21C 

OF THE SECURITIES EXCHANGE ACT 

OF 1934, MAKING FINDINGS, AND 

IMPOSING REMEDIAL SANCTIONS AND 

A CEASE-AND-DESIST ORDER  

 

I. 

 

 The Securities and Exchange Commission (“Commission”) deems it appropriate and in the 

public interest that public administrative and cease-and-desist proceedings be, and hereby are, 

instituted pursuant to Sections 15(b) and 21C of the Securities Exchange Act of 1934 (“Exchange 

Act”) against Paul John McCabe, Jr. (“McCabe”) and PMAC Consulting, LLC (“PMAC,” and 

collectively with McCabe, “Respondents”).   

 

II. 

 

 In anticipation of the institution of these proceedings, Respondents have submitted an Offer 

of Settlement (the “Offer”) which the Commission has determined to accept. Solely for the purpose 

of these proceedings and any other proceedings brought by or on behalf of the Commission, or to 

which the Commission is a party, and without admitting or denying the findings herein, except as 

to the Commission’s jurisdiction over them and the subject matter of these proceedings, which are 

admitted, and except as provided herein in Section V as to McCabe, Respondents consent to the 

entry of this Order Instituting Administrative and Cease-and-Desist Proceedings, Pursuant to 

Sections 15(b) and 21C of the Securities Exchange Act of 1934, Making Findings, and Imposing 

Remedial Sanctions and a Cease-and-Desist Order (“Order”), as set forth below. 

 



 2 

III. 

 

 On the basis of this Order and Respondents’ Offer, the Commission finds1 that: 

 

Summary 

 

 These proceedings arise out of unregistered broker activity by McCabe, conducted through 

his solely-owned entity, PMAC.  Until October 2016, McCabe was a registered representative 

associated with broker-dealers registered with the Commission.  In December 2016, McCabe 

consented to a permanent bar by the Financial Industry Regulatory Authority (“FINRA”) from 

acting as a broker or otherwise associating with a registered broker-dealer.  From October 2016 

through June 2023, McCabe continued to broker securities transactions between holders of shares of 

stock in private companies that were expected to go public through an initial public offering (“Pre-

IPO Shares”) and funds seeking to acquire such Pre-IPO Shares.  Between October 2018 and June 

2023, McCabe received more than $16 million in transaction-based compensation through PMAC 

for unregistered broker activity on behalf of several fund clients and nearly 100 sellers.  McCabe 

and PMAC acted as unregistered brokers in violation of Section 15(a) of the Exchange Act in 

connection with these securities transactions.     

 

Respondents 

 

 1. McCabe (CRD No. 2751063), age 56, resides in Bethesda, Maryland.  McCabe 

previously held Series 6, 7, 63, and Securities Industry Essentials licenses.  From 1996 through 

October 2016, McCabe was associated with six different registered broker-dealers.  In December 

2016, McCabe consented to a permanent bar by FINRA for failing to provide information and 

documents requested by FINRA in connection with an examination of the registered broker-dealer 

with which he was then associated.  Since October 2016, McCabe has not been associated with a 

registered broker-dealer. 

 

 2. PMAC is a single-member managed limited liability corporation established by 

McCabe in Michigan on October 13, 2016, with its principal place of business in Bethesda, 

Maryland.  McCabe is the sole owner and manager of PMAC.  From October 2016 through June 

2023, McCabe conducted his unregistered broker activities primarily through the PMAC entity, and 

buyers and sellers of Pre-IPO Shares executed fee agreements with PMAC and paid PMAC 

transaction-based compensation in connection with this unregistered broker activity. 

 

 

Background 

3. From March 2009 through October 2016, McCabe was at various times associated 

with five different registered broker-dealers (the “Registered Broker-Dealers”) specializing in 

transactions in Pre-IPO Shares.  While so associated, he met potential buyers and sellers of Pre-

 
1  The findings herein are made pursuant to Respondents’ Offer of Settlement and are not 

binding on any other person or entity in this or any other proceeding. 

 



 3 

IPO Shares by using websites, attending conferences, and word of mouth.  He then connected 

potential buyers and sellers looking to transact in Pre-IPO Shares.  Upon successful completion of 

a transaction brokered by McCabe, the seller paid transaction-based compensation in the form of a 

percentage of the sale to the Registered Broker-Dealers, from which McCabe’s compensation was 

derived.  

4. During McCabe’s tenure at one of the Registered Broker-Dealers, McCabe used a 

fee agreement form for transactions in Pre-IPO Shares that he brokered (the “Registered Broker-

Dealer Fee Agreement”).  The Registered Broker-Dealer Fee Agreement included certain provisos 

including one specifying: “[Registered Broker-Dealer] represents and warrants that it is a 

registered broker-dealer under Section 15 of the Securities Exchange Act of 1934, as amended, and 

has appropriate state licenses to provide the services and receive the fees hereunder.”  The 

language of the Registered Broker-Dealer Fee Agreement of the last two Registered Broker-

Dealers with which McCabe was associated stated “[Registered Broker-Dealer] is a registered 

broker dealer.”   

5.  In October 2016, as part of a FINRA examination of the last Registered Broker-

Dealer with which McCabe was affiliated, FINRA requested that McCabe produce certain 

information and documents.  Rather than do so, McCabe decided to leave that Registered Broker-

Dealer and terminate his FINRA registration, which eliminated his obligation to produce 

documents and information.  On October 14, 2016, McCabe resigned from his last Registered 

Broker-Dealer.  On November 17, 2016, he submitted a Letter of Acceptance, Waiver, and 

Consent (“AWC”) to FINRA, in which he consented to a bar from associating with any FINRA 

member firm in any capacity.  FINRA accepted and entered the AWC on December 8, 2016. 

6. On October 13, 2016—the day before McCabe resigned from his last Registered 

Broker-Dealer—he created PMAC to continue facilitating transactions in Pre-IPO Shares, 

notwithstanding his lack of association with a registered broker-dealer and his plan to terminate his 

registration with FINRA.  Shortly before establishing PMAC, McCabe informed multiple clients 

that he would be leaving his last Registered Broker-Dealer and could be reached at his personal 

email address, adding that “nothing will change as far as business goes” and he was “still doing the 

same thing just on my own.”   

7. McCabe used a modified version of the Registered Broker-Dealer Fee Agreement 

at PMAC that he created called the PMAC Consulting Agreement, which included the number of 

shares; price per share plus “referral fee”; gross amount buyer obligation; PMAC’s fee; and seller 

proceeds as the relevant information to be input.  McCabe also included a proviso in the PMAC 

Consulting Agreement specifying that the “[f]ee is to be paid directly to PMAC Consulting by 

buyer [or seller] upon successful completion of the transaction between buyer [] and seller[.]”  

McCabe did not include the statement from the Registered Broker-Dealer Fee Agreements about 

being a registered broker-dealer. 

8. The business McCabe conducted through PMAC was a continuation of the same 

activity he previously performed as a registered representative at the Registered Broker-Dealers.  

McCabe described the work he conducted at the Registered Broker-Dealers with which he was 

associated as the same as with PMAC Consulting.  



 4 

9. Between October 2016 and June 2023, McCabe, through PMAC, negotiated the 

terms of transactions for the purchase and sale of Pre-IPO Shares, worked directly with the issuers 

of Pre-IPO Shares with respect to the mechanics of share transfers, provided purchasers with 

advice or valuations as to the merits of a particular investment, handled and submitted paperwork 

for the transactions, acted as the primary intermediary between buyers, sellers, and their agents or 

representatives, paid fees to certain issuers to effectuate closings, and actively identified and 

solicited sellers of Pre-IPO Shares in particular companies for buyers.   

10.  McCabe, through PMAC, was usually paid a percentage fee of the transaction when 

the transaction closed as compensation for his unregistered broker activities.  Between October 

2018 and June 2023, McCabe received more than $16 million in transaction-based compensation 

through PMAC for unregistered broker activity on behalf of several fund clients and nearly 100 

sellers.  McCabe received compensation from both purchasers and sellers, sometimes collecting 

fees from both sides in the same transaction.  The fees collected by McCabe through PMAC were 

typically between 3% and 5% of the total transaction price.  The transactions were typically 

documented using the PMAC Consulting Agreement.  

 

11. As a result of the conduct described above, Respondents willfully violated Section 

15(a) of the Exchange Act, which prohibits any broker or dealer from making use of the mails or 

any means or instrumentality of interstate commerce, to effect any transaction in, or induce or 

attempt to induce the purchase or sale of, any security unless the broker or dealer is registered in 

accordance with Section 15(b) of the Exchange Act or is a natural person who is associated with a 

registered broker or dealer. 2 

 

IV. 

 In view of the foregoing, the Commission deems it appropriate and in the public interest to 

impose the sanctions agreed to in the Respondents McCabe and PMAC’s Offer. 

 

 Accordingly, pursuant to Sections 15(b) and 21C of the Exchange Act, it is hereby 

ORDERED that: 

 

 A. Respondents McCabe and PMAC cease and desist from committing or causing any 

violations and any future violations of Section 15(a) of the Exchange Act.  

 

 
2   “Willfully,” for purposes of imposing relief under Section 15(b) of the Exchange Act, 

“‘means no more than that the person charged with the duty knows what he is doing.’”  Wonsover 

v. SEC, 205 F.3d 408, 414 (D.C. Cir. 2000) (quoting Hughes v. SEC, 174 F.2d 969, 977 (D.C. Cir. 

1949)).  There is no requirement that the actor “also be aware that he is violating one of the Rules 

or Acts.”  Tager v. SEC, 344 F.2d 5, 8 (2d Cir. 1965).  The decision in The Robare Group, Ltd. v. 

SEC, which construed the term “willfully” for purposes of a differently structured statutory 

provision, does not alter that standard.  922 F.3d 468, 478-79 (D.C. Cir. 2019) (setting forth the 

showing required to establish that a person has “willfully omit[ted]” material information from a 

required disclosure in violation of Section 207 of the Advisers Act). 

  



 5 

B. Respondent McCabe be, and hereby is: 

 

barred from association with any broker, dealer, investment adviser, 

municipal securities dealer, municipal advisor, transfer agent, or nationally 

recognized statistical rating organization; and 

barred from participating in any offering of a penny stock, including: 

acting as a promoter, finder, consultant, agent or other person who 

engages in activities with a broker, dealer or issuer for purposes of the 

issuance or trading in any penny stock, or inducing or attempting to induce 

the purchase or sale of any penny stock.  

 C. Any application for reentry by Respondent McCabe will be made to the appropriate 

self-regulatory organization, or if there is none, to the Commission by contacting the Division of 

Enforcement’s Office of Chief Counsel at [email protected], and will be subject to the 

applicable laws and regulations governing the reentry process.  Reentry may be conditioned upon a 

number of factors, including, but not limited to, compliance with the Commission’s order and 

payment of any or all of the following:  (a) any disgorgement or civil penalties ordered by a Court 

against Respondent McCabe in any action brought by the Commission; (b) any disgorgement 

amounts ordered against Respondent McCabe for which the Commission waived payment; (c) any 

arbitration award related to the conduct that served as the basis for the Commission order; (d) any 

self-regulatory organization arbitration award to a customer, whether or not related to the conduct 

that served as the basis for the Commission order; and (e) any restitution order by a self-regulatory 

organization, whether or not related to the conduct that served as the basis for the Commission 

order. 

  

D. Respondents McCabe and PMAC shall pay a civil money penalty in the amount of 

$3,000,000.00, jointly and severally, to the Securities and Exchange Commission for transfer to the 

general fund of the United States Treasury, subject to Exchange Act Section 21F(g)(3).  Payment 

shall be made in the following installments:   

 

1. Due within 21 days of the entry of this Order:  $600,000.00; 

2. Due within 90 days of the entry of this Order:  $600,000.00; 

3. Due within 180 days of the entry of this Order:  $600,000.00; 

4. Due within 270 days of the entry of this Order:  $600,000.00; and 

5. The remainder within 360 days of the entry of this Order. 

 

Payments shall be applied first to post order interest, which accrues pursuant to 31 U.S.C. 

§ 3717.  Prior to making the final payment set forth herein, Respondents shall contact the staff of 

the Commission for the amount due.  If Respondents fail to make any payment by the date agreed 

and/or in the amount agreed according to the schedule set forth above, all outstanding payments 

under this Order, including post-order interest, minus any payments made, shall become due and 

payable immediately at the discretion of the staff of the Commission without further application to 

the Commission.   

 



 6 

Payment must be made in one of the following ways:   

 

(1) Respondents may transmit payment electronically to the Commission, 

which will provide detailed ACH transfer/Fedwire instructions upon 

request;  

 

(2) Respondents may make direct payment from a bank account via Pay.gov 

through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  

 

(3) Respondents may pay by certified check, bank cashier’s check, or United 

States postal money order, made payable to the Securities and Exchange 

Commission and hand-delivered or mailed to:  

 

Enterprise Services Center 

Accounts Receivable Branch 

HQ Bldg., Room 181, AMZ-341 

6500 South MacArthur Boulevard 

Oklahoma City, OK 73169 

 

Payments by check or money order must be accompanied by a cover letter identifying 

McCabe and/or PMAC as a Respondent in these proceedings, and the file number of these 

proceedings; a copy of the cover letter and check or money order must be sent to Associate 

Regional Director Sheldon Pollock, Division of Enforcement, Securities and Exchange 

Commission, 100 Pearl Street, Suite 20-100, New York, NY 10004-2616. 

 

 E. Amounts ordered to be paid as civil money penalties pursuant to this Order shall be 

treated as penalties paid to the government for all purposes, including all tax purposes.  To 

preserve the deterrent effect of the civil penalty, Respondents agree that in any Related Investor 

Action, they shall not argue that they are entitled to, nor shall they benefit by, offset or reduction of 

any award of compensatory damages by the amount of any part of a Respondent’s payment of a 

civil penalty in this action (“Penalty Offset”).  If the court in any Related Investor Action grants 

such a Penalty Offset, Respondents agree that they shall, within 30 days after entry of a final order 

granting the Penalty Offset, notify the Commission's counsel in this action and pay the amount of 

the Penalty Offset to the Securities and Exchange Commission.  Such a payment shall not be 

deemed an additional civil penalty and shall not be deemed to change the amount of the civil 

penalty imposed in this proceeding.  For purposes of this paragraph, a “Related Investor Action” 

means a private damages action brought against a Respondent by or on behalf of one or more 

investors based on substantially the same facts as alleged in the Order instituted by the 

Commission in this proceeding. 

 

V. 

It is further Ordered that, solely for purposes of exceptions to discharge set forth in Section 

523 of the Bankruptcy Code, 11 U.S.C. § 523, the findings in this Order are true and admitted by 

Respondent McCabe, and further, any civil penalty or other amounts due by Respondent McCabe 

under this Order or any other judgment, order, consent order, decree or settlement agreement 

http://www.sec.gov/about/offices/ofm.htm


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entered in connection with this proceeding, is a debt for the violation by Respondent McCabe of 

the federal securities laws or any regulation or order issued under such laws, as set forth in Section 

523(a)(19) of the Bankruptcy Code, 11 U.S.C. § 523(a)(19). 

 

 

 By the Commission. 

 

 

 

Vanessa A. Countryman 

       Secretary