SEC v. Mason D. Newman, No. 0:20-cv-61976-AHS, Southern District of Florida (Sept. 30, 2020) — Complaint

OF FLORIDA
__________________________
v.
,
.
________________________________________________
(“Commission”)
1.
o(“NIT”),
2019.
$984,000217
.
2.,
the company’s research, development, and efforts to go public, while concealing that he would
Newman’s
on .
NIT’s CEO $1.25 ,,

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT
CASE NO.:
SECURITIES AND EXCHANGE COMMISSION, )
)
Plaintiff, )
)
)
)
MASON D. NEWMAN a/k/a Barry Weiss )
)
Defendant )
I
COMPLAINT FOR INJUNCTIVE AND OTHER RELIEF
Plaintiff Securities and Exchange Commission alleges as follows:
INTRODUCTION
The Commission brings this action against the Defendant Mason D. Newman for
his participati n  in an offering fraud scheme on behalf
of NIT Enterprises, Inc. which
defrauded retail investors nationwide and in Canada,  most
of whom were seniors, from 2015
through at least November Through his material misrepresentations and omissions,
Newman deceived investors into believing that NIT was a  good investment while unlawfully
raising approximately from investors and received nearly
$ ,000 in undisclosed
comm1ss1ons In total, NIT raised $4.9 million at least from 100 investors.
In investor solicitations Newman told investors that NIT would use investor funds
for
receive 30% in commissions from investor proceeds.  Unbeknownst to customers, in
reality, NIT spent little
of the funds raised research, development, or on efforts to go public
Instead, misappropriated at least
million or 25%
of investor proceeds to pay

2
CEO
.
3.Newman’s
,
.
4.Newman’s
regarding NIT’s .
(“IPO”)
.
5.
Securities Act of 1933 (“Securities Act”)
,of the Securities Exchange Act of 1934 (“Exchange Act”)
.
6.,

for personal expenses, while NIT and the paid unregistered brokers like Newman up to at
least 30% or more in undisclosed commissions on the money they raised from investors
role in this multi-million dollar fraud was to cold-call potential investors
and convince them to invest in NIT stock utilizing a  series
of material misrepresentations and
omissions. Newman is  a recidivist securities law violator, who continued to solicit investors and
sell NIT shares even after the Commission in September 2016 prohibited him from associating
with a broker or dealer and from participating in penny stock offerings Newman used an alias to
conceal the fact that the Commission had so prohibited him.
solicitations
of investors contained baseless and false representations
value and future profitability Newman also concealed that NIT was paying him
approximately 30%-50% in commissions from investor proceeds. Newman also told investors
that NIT was preparing to engage in an initial public offering and soon would become a
publicly traded company, which created an expectation that investors would double or triple their
investment in a short amount
of time
By engaging in this conduct Newman violated Sections 5(a), 5(c), and 17(a)
of the
[15 U.S.C.
§§ 77e(a), 77e(c), and 77q(a)] and Sections
l0(b) 15(a) and 15(b)(6)(B)
[15
u.s.c.
§§ 78j(b), 78o(a), and 78o(b)(6)(B)] and Rule lOb-5 thereunder [17 C.F.R. § 240.l0b-5] Unless
enjoined, Newman is reasonably likely to continue to violate the federal securities laws.
THE DEFENDANT
Newman
age 51, resides in Hollywood, Florida. Newman worked for NIT as an
unregistered broker and was paid approximately $216,787 in commissions. From
1991 to 2005,
Newman was a  registered representative associated with various registered broker-dealers. In

3
17599,.
“Barry Weiss” to conceal his prior .
7.
May 2014,
, incorporated in Florida in June 2016.  NIT’s principal place of business
any capacity.  During the relevant period, NIT’s securities qualified as a “penny stock” because
they  did  not  meet  any  of  the  exceptions  from  the  definition  of  a  “penny  stock,”  as  defined  by
securities  were  equity  securities:  (1)  that  were  not  an  “NMS  stock,”  as  defined  in  17  C...
not meet any of the other exceptions from the definition of “penny stock” contained in Rule 3a51

2005, without admitting or denying allegations, Newman settled NASD charges relating to sales
practice violations, received a one-year suspension and was ordered to pay $10,000. In 2016, the
Commission charged Newman with violations
of Section 15(a) of the Exchange Act for acting as
an unregistered broker-dealer in the offer and sale
of securities of microcap issuer eCareer
Holdings, Inc.
(In the Matter of Mason D. Newman, AP File No. 3-Sept. 29, 2016)
Newman agreed to settle the charges and was ordered to pay disgorgement of $169,000,
prejudgment interest
of $3,110, a  civil penalty of $7,500 and was subject to a  collateral bar, a
penny stock bar, and an investment company prohibition. Newman has not paid the judgment
amounts. During the time that Newman solicited investors on behalf
of NIT, he used the alias
Inc.
Commission sanctions
RELATED ENTITY
NIT
consisted of three entities: NIT Enterprises, Inc., incorporated in Delaware in
NIT Enterprises, Inc., incorporated in Florida in May 2014, and NIT Enterprises FL,
was in Palm Beach
Gardens, Florida. NIT and its investment offerings were not registered with the Commission in
Section 3(a)(51)
of the Exchange Act and Rule 3a51-1 thereunder. Among other things, the
FR
242.600(b )( 47); (2) traded below five dollars per share during the relevant period; (3) whose issuer
had net tangible assets and average revenue below the thresholds
of Rule 3a51-1 (g)(l );  and ( 4) did
1 under the Exchange Act.

4
8.
.
9.
’
Distr.
10.
11.2015, ,
4.9
.
,
..
., 1924822.
12.“genetic material solutions” in order to, among other
,.
,

JURISDICTION AND VENUE
This Court has jurisdiction over this action pursuant to Sections 20(b ),  20( d) and
22(a)
of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d) and 77v(a)], and Sections 21(d), 21(e), and
27(a)
of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e) and 78aa(a)]
This Court has personal jurisdiction over the Defendant and venue is proper in the
Southern District
of Florida because many of Newman s  acts and transactions constituting the
violations
of the Securities Act and Exchange Act occurred in the Southern
Moreover, Newman resides in the Southern District
of Florida.
ict
of Florida
In connection with the conduct alleged in this Complaint, Newman, directly or
indirectly, singly
or in concert with others, made use of the means or instruments of transportation
and communication in interstate commerce, and the mails.
FACTUAL ALLEGATIONS
A. NIT Fraudulent Scheme
Beginning at least as early as March NIT Newman and others executed a
fraudulent scheme through which they raised at least
$ million from investors in the Southern
District
of Florida and nationwide The NIT fraud scheme did not cease until November 2019,
when the Commission filed a complaint charging NIT, its CEO and two other unregistered brokers
with securities fraud on an emergency basis in order to stop the ongoing fraud
SEC v NIT
Enterprises, et.al
-CV--CMA (S.D. Fla ).
NIT claimed to be developing
things, produce lightweight protection garments that would protect against exposure to damaging
radiation with medical and military applications NIT claimed to have several agreements
or
partnerships with other entities that were assisting with the testing and production of its protection
garments.
In offering materials intended to lure prospective investors into investing NIT made it

5
.
capital for design production efforts and materials, “until profits break even with
costs as production grows.”
13.
NIT’s  website.
company, its directors and management, NIT’s technology and various business relationships
14.NIT’s   website   and   Executive   Summary
regarding  NIT’s  timing  for  going  public.    For  example,  a  June  2016  investo
NIT “plans to enter the public market, filing Form S2, 2016.”
2019, NIT’s website statedthe company “has prepared an S
company.”
15.NIT’s  subscription  agreement
d
.
.
’s Solicitation of Investors
16.hired by NIT’s CEO.
“cold call” scripts as well as sales materials to use when soliciting investors.

appear that funds raised from investors would be directed to research and development efforts
For example, in 2018 and 2019, NIT sent investors several updates that referenced the need to
raise additional
NIT followed up on investor solicitations
by providing prospective investors with
an NIT Executive Summary, a  stock subscription agreement and a link to further information on
The Executive Summary purported to provide general information about the
to
further its research and development, and ultimate production,
of its protection garments and
materials.
made inconsistent representations
r  update stated that
-1 (IPO) in Q-
As late as November
-1 registration for the SEC. With this
filing expected m 2018, NIT would become an independent full reporting, audited, public
state that the investor had a  substantive and pre-
existing relationship with NIT before investing However, this was far from the truth. Most
investors solicited had never heard
of NIT before the initial cold-call solicitation they received
from Newman or another NIT sales agent
B. Newman
Newman was to solicit investors Newman was provided with
Newman acted as an

6
,
,
“Barry Weiss.”
.
17.
NIT’s value and business prospects, .
18.
with him in previous private offerings “free” shares in NIT to .
the  “free”  would
.
19.
an S1
.
20.NIT’s  website  and  Executive  Summary  provided  to  investors  contained  at  times
inconsistent representations regarding NIT’s timing for going public.  For example, a June 2016
hat NIT “plans to enter the public market, filing Form S2,

unregistered broker by soliciting investors participating in the sale of NIT stock, and receiving
commissions. After the Commission prohibited Newman from associating with a broker or dealer
and from participating in penny stock offerings in September 2016 Newman continued to engage
in the prohibited conduct while masking his true identity using the alias
C
Material Misrepresentations and Omissions to Investors and Other Deceptive
Conduct
Newman sold NIT stock to investors usmg high-pressure sales tactics that
misrepresented such as claims that an NIT IPO was imminent
Newman made baseless claims that the NIT shares were discounted for varying reasons and that
the true value
of the shares were much higher, when in fact, they were not.
Newman solicited investors who had invested with him in prior private offerings
and cold-called investors from lead lists. At times, Newman offered investors who had invested
make up for past losses Once the
investor received NIT shares, Newman solicit the investor to further invest in
NIT utilizing misrepresentations and omissions
Throughout his years soliciting investors for NIT, Newman continually
misrepresented that an NIT IPO would occur in the near future.  This misrepresentation was made
by NIT, its CEO, and unregistered sales agents like Newman, orally and through the use
of written
offering materials, which Newman would have NIT send to investors after the solicitation. In fact,
NIT made no effort to take the company public and never filed
the Commission
investor update stated t
-registration statement with
-1 (IPO) in Q-

7
2016.”    In  October  2019,  NIT’s  website  (which  was  not  updated),  stated  the  company  “has
2018
,  public  company.”  (emphasis  added).    The  NIT  2017
by
21.
misrepresentations  about  the  timing  of  NIT’s  purported  IPO.  ,
22.
23.
Commission’s  bar  order.
by  using  the  name  “,”
.
5

prepared an S-1 registration for the SEC. With this filing expected in
an independent full reporting, audited
, NIT would become
Executive Summary sent to investors contained the same statement with a  2017 expected filing
date.  Numerous investors were falsely told Newman that NIT was a good investment because
the company would be conducting an IPO.  Ultimately, NIT never filed a registration statement
with the Commission for a public offering
of securities, much less had such a registration statement
declared effective.
with his
Newman also made baseless and contradictory price projections in conjunction
To at least one investor
Newman offered NIT shares at a rate
of2 shares for the price of 1.
NIT and its CEO paid Newman transaction-based compensation in the form
of
commissions of approximately 30% of the investor funds he raised. Newman did not disclose to
investors that he would be receiving such large commissions.
In September 2016, the Commission barred Newman, which, as he knew, included
bars prohibiting him from acting
as or associating with a broker or dealer or participating in penny
stock offerings.  Nevertheless, shortly after the institution
of his bars, Newman continued to act as
a broker or dealer by soliciting investors to purchase NIT stock, a penny stock, in violation
of the
Newman deliberately omitted disclosing his disciplinary history and
concealed his true identity from investors
solicitations
of investors
CLAIMS FOR RELIEF
COUNTI
Barry Weiss an alias,  in
Violations
of Sections (a) and S(c) of the Securities Act

8
24.
1 23
25.
26.
2019,
27.
.
1
28.23
.

The Commission repeats and realleges Paragraphs through
of this Complaint
as
if fully set forth herein.
No registration statement was filed or in effect with the Commission pursuant to
the Securities Act with respect to the securities and transactions described in this Complaint and
no exemption from registration existed with respect to these securities and transactions.
From at least as early as February 2015 and continuing through at least September
Newman, directly and indirectly:
(a) made use
of means or instruments of transportation or communication in
interstate commerce or
of the mails to sell securities as described herein, through the use or
medium
of a prospectus or otherwise;
(b) carried securities or caused such securities, as described herein, to be carried
through the mails or in interstate commerce, by any means or instruments
of transportation, for the
purpose
of sale or delivery after sale; or
( c) made use
of means or instruments of transportation or communication in
interstate commerce or
of the mails to offer to sell or offer to buy through the use or medium of a
prospectus or otherwise, as described herein, without a registration statement having been filed or
being in effect with the Commission as to such securities.
By reason
of the foregoing, Newman violated and, unless enjoined, is  reasonably
likely to continue to violate, Sections 5(a) and 5(c)
of the Securities Act [15 U.S.C §§ 77e(a) and
77e(c)]
COUNT II
Fraud in the Offer or Sale of Securities in Violation of
Section 17(a)( ) of the Securities Act
The Commission repeats and realleges Paragraphs 1 through of this Complaint
as
if fully set forth herein

9
29.
2015
2019, , d,
,
30.v,
15.
2
31.23
32.2015 2019,
,, by
33.,
215772.
34.23
35.
2019, , ,

From at least as early as February
and continuing through at least September
Newman irectly and indirectly, in the offer or sale
of securities by use of any means or
instruments
of transportation or communication in interstate commerce or by use of the mails did
knowingly or recklessly employ devices, schemes or artifices to defraud.
By reason
of the foregoing, Newman iolated and, unless enjoined is  reasonably
likely to continue to violate, Section 17(a)(l)
of the Securities Act [ U.S.C. § 77q(a)(l)]
COUNT III
Fraud in the Off er or Sale of Securities in
Violation
of Section 17{a){ ) of the Securities Act
The Commission repeats and realleges Paragraphs 1 through of this Complaint
as
if fully set forth herein.
From
as early as February and continuing through at least September
Newman directly and indirectly, in the offer or sale
of securities the use of any means or
instruments
of transportation or communication in interstate commerce or by use of the mails,
negligently obtained money or property by means
of untrue statements of material facts and
omissions 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.
By reason
of the foregoing, Newman violated and unless enjoined, is  reasonably
likely to continue to violate, Section 17(a)( )
of the Securities Act [     U.S.C. § q(a)( )]
COUNT IV
Fraud in the
Off er or Sale of Securities in
Violation
of Section 17{a){3) of the Securities Act
The Commission repeats and realleges Paragraphs 1 through of this Complaint
as
if fully set forth herein.
From at least as early as February 2015 and continuing through at least September
Newman directly and indirectly, in the offer or sale
of securities by use of any means or

10
36.
.
5
37.23
38.2015
2019,
,
,
39.v,
5b5.
Connectio
Section 10(b)
40.23
41.2015 2019,
,

instruments of transportation or communication in interstate commerce or by use of the mails,
negligently engaged in transactions, practices, or courses
of business which operated, are now
operating or will operate as a fraud or deceit upon the purchasers.
By reason
of the foregoing Newman violated and, unless enjoined, is  reasonably
likely to continue to violate Section 17(a)(3)
of the Securities Act [15 U.S.C. § 77q(a)(3)]
COUNTV
Fraud in Connection with the Purchase or Sale of Securities in
Violation
of Section 1 O{b) and Rule 1 Ob-{a) of the Exchange Act
The Commission repeats and realleges Paragraphs 1 through of this Complaint
as
if fully set forth herein.
From at least as early as February and continuing through at least September
Newman, directly and indirectly, in connection with the purchase or sale
of securities by use
of any means and instrumentalities of interstate commerce or by use of the mails knowingly or
recklessly employed devices, schemes or artifices to defraud in connection with the purchase or
sale
of securities.
By reason
of the foregoing, Newman iolated and unless enjoined, is  reasonably
likely to continue to violate, Section lO(b)
of the Exchange Act [15 U.S.C. § 78j(b)] and Exchange
Act Rule
lOb-(a) and [17 C.F.R. § 240.10 -  (a)]
COUNT VI
Fraud in n with the Purchase or Sale
of Securities in Violation of
and Rule 1 Ob-S{b) of the Exchange Act
The Commission realleges and incorporates paragraphs 1  through
Complaint as
if fully set forth herein.
of this
From
as early as February and continuing through at least September
Newman directly and indirectly, in connection with the purchase or sale
of securities by use of any
means and instrumentalities
of interstate commerce or of the mails knowingly or recklessly made

11
42.,
bb.
Section 10(b)
5
43.23
44.
2019,
45.v
,1
0b.§ 240.10b.
46.23
.
47.
2019, , d

untrue statements of material facts or omitted to state material facts in order to make the statements
made, in light
of the circumstance in which they were made, not misleading.
By reason of the foregoing, Newman violated and unless enjoined, is  reasonably
likely to continue to violate, Section lO(b)
of the Exchange Act [15 U .S.C. § 78j(b)] and Exchange
Act Rule
lOb-5() [17 C.F.R. § 240.lOb-5( )]
COUNT VII
Fraud in Connection with the Purchase or Sale
of Securities in Violation of
and Rule lOb-(c) of the Exchange Act
The Commission repeats and realleges paragraphs 1 through
of this Complaint
as
if fully set forth herein.
From at least as early as February 2015 and continuing through at least September
Newman directly or indirectly, in connection with the purchase or sale
of securities by the
use of the means or instrumentalities of interstate commerce, or of the mails, knowingly or
recklessly engaged in acts, practices, and courses
of business which have operated, or would have
operated as a fraud upon the purchasers of such securities.
By reason of the foregoing, Newman iolated, and unless enjoined, is  reasonably
likely to continue to violate Section 0(b)
of the Exchange Act [15 U.S.C. § 78j(b)] and Exchange
Act Rule 1 -5(c) [17 C.F
R. -5(c)]
COUNT VIII
Unregistered Broker-Dealer Conduct in Violation
of
Section 15(a)(l) of the Exchange Act
The Commission repeats and realleges paragraphs 1 through
of this Complaint
as
if fully set forth herein
From at least as early as February 2015 and continuing through at least September
Newman irectly and indirectly, by the use
of the mails or the means and instrumentalities
of interstate commerce, effected transactions in, or induced or attempted to induce the purchase

12
.
48.
,
49.23
.
50.
,
2019,
.
51.
.
,,
U.S.C. §§ 78j(b), 78o(a)

and sale
of securities, while he was not not registered with the Commission as a broker or dealer
or when he was not associated with an entity registered with the Commission as a broker or dealer
in accordance with Section 15(b)
of the Exchange Act [15 U.S.C. § 78o(b)]
By reason
of the foregoing, Newman violated and, unless enjoined, is  reasonably
likely to continue to violate Section 15(a)(l)
of the Exchange Act [15 U.S.C. § 78o(a)(l)].
COUNT IX
Violation of a Commission Order
The Commission repeats and realleges paragraphs 1 through of this Complaint
as
if fully set forth herein
Beginning on or about September 29, 2016 and continuing through at least
September Newman acted
as a broker or dealer and participated in an offering of a penny
stock in contravention
of a prior Commission order prohibiting such activities
By reason
of the foregoing, Newman violated and, unless enjoined, is  reasonably
likely to continue to violate, Section 15(b)(6)(B)
of the Exchange Act [15 U.S.C. § 78o(b)(6)(B)]
RELIEF REQUESTED
WHEREFORE,
the Commission respectfully requests the Court find that Newman
committed the violations alleged, and:
I.
Permanent Injunction
Issue a  Permanent Injunction restraining and enjoining Newman his officers, agents,
servants, employees, attorneys, and all persons in active concert or participation with him, and
each
of them, from violating Sections 5(a),  5(c), and 17(a) of the Securities Act [15 U.S.C. §§
77e(a), 77e(c), and 77q(a)] and Sections lO(b), 15(a)(l), and 15(b)(6)(B) of the Exchange Act [15
(1), and 78o(b)(6)(B)] and Rule l0b-5 thereunder [17 C.F.R. § 240.l0b-
5].

13
.
§.
.
.
.
29, 2020
0142859
6376

II
Civil Money Penalties
Issue an Order directing Newman to pay civil money penalties pursuant to Section 20(d)
of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d) of the Exchange Act [15 U .S.C.
78(d)]
III
Disgorgement and Preiudgment Interest
Issue an Order directing Newman to disgorge all ill-gotten gains, including prejudgment
interest, resulting from the acts and/or courses
of conduct complained of herein.
IV
Further Relief
Grant such other and further relief as may be necessary and appropriate.
V
Retention of Jurisdiction
Further, the Commission respectfully requests that the Court retain jurisdiction over this
action in order to implement and carry out the terms
of all orders and decrees that may hereby be
entered, or to entertain any suitable application or motion by the Commission for additional relief
within the jurisdiction
of this Court.
DEMANDFORJURYTRIAL
The Commission hereby demands a trial by jury on any and all issues in this action so triable.
Dated: September Respectfully submitted,
By: s/Wilfredo Fernandez
Wilfredo Fernandez
Senior Trial Counsel
Florida Bar No.
Telephone: (305) 982-
Email: [email protected]

14
9826318
6300
5364154

Of Counsel:
Eric E. Morales, Senior Counsel
Securities and Exchange Commission
801 Brickell Avenue, Suite 1950
Miami, Florida 33131
Michael
J. Gonzalez
Senior Counsel
Florida
Bar No. 110598
Telephone: (305)
Email: [email protected]
Attorneys for Plaintiff
SECURITIES AND EXCHANGE
COMMISSION
801 Brickell A venue, Suite 1950
Miami, Florida 33131
Telephone: (305) 982-
Facsimile: (305)

OF FLORIDA

__________________________

v.

,

.
________________________________________________

(“Commission”) 

1.

o (“NIT”),

2019.

$984,000 217

.

2. ,

the company’s research, development, and efforts to go public, while concealing that he would 

Newman’s 

on .  

NIT’s CEO $1.25 , ,

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 1 of 14 

UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT 

CASE NO.: 

SECURITIES AND EXCHANGE COMMISSION, ) 
) 

Plaintiff, ) 
) 
) 
) 

MASON D. NEWMAN a/k/a Barry Weiss ) 
) 

Defendant ) 
I 

COMPLAINT FOR INJUNCTIVE AND OTHER RELIEF 

Plaintiff Securities and Exchange Commission alleges as follows: 

INTRODUCTION 

The Commission brings this action against the Defendant Mason D. Newman for 

his participati n in an offering fraud scheme on behalf of NIT Enterprises, Inc. which 

defrauded retail investors nationwide and in Canada, most of whom were seniors, from 2015 

through at least November Through his material misrepresentations and omissions, 

Newman deceived investors into believing that NIT was a good investment while unlawfully 

raising approximately from investors and received nearly $ ,000 in undisclosed 

comm1ss1ons In total, NIT raised $4.9 million at least from 100 investors. 

In investor solicitations Newman told investors that NIT would use investor funds 

for 

receive 30% in commissions from investor proceeds. Unbeknownst to customers, in 

reality, NIT spent little of the funds raised research, development, or on efforts to go public 

Instead, misappropriated at least million or 25% of investor proceeds to pay 



2

CEO

.

3. Newman’s 

,

.

4. Newman’s 

regarding NIT’s .  

(“IPO”)

.

5.

Securities Act of 1933 (“Securities Act”)

, of the Securities Exchange Act of 1934 (“Exchange Act”) 

.

6. ,

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 2 of 14 

for personal expenses, while NIT and the paid unregistered brokers like Newman up to at 

least 30% or more in undisclosed commissions on the money they raised from investors 

role in this multi-million dollar fraud was to cold-call potential investors 

and convince them to invest in NIT stock utilizing a series of material misrepresentations and 

omissions. Newman is a recidivist securities law violator, who continued to solicit investors and 

sell NIT shares even after the Commission in September 2016 prohibited him from associating 

with a broker or dealer and from participating in penny stock offerings Newman used an alias to 

conceal the fact that the Commission had so prohibited him. 

solicitations of investors contained baseless and false representations 

value and future profitability Newman also concealed that NIT was paying him 

approximately 30%-50% in commissions from investor proceeds. Newman also told investors 

that NIT was preparing to engage in an initial public offering and soon would become a 

publicly traded company, which created an expectation that investors would double or triple their 

investment in a short amount of time 

By engaging in this conduct Newman violated Sections 5(a), 5(c), and 17(a) of the 

[15 U.S.C. §§ 77e(a), 77e(c), and 77q(a)] and Sections 

l0(b) 15(a) and 15(b)(6)(B) [15 u.s.c. 

§§ 78j(b), 78o(a), and 78o(b)(6)(B)] and Rule lOb-5 thereunder [17 C.F.R. § 240.l0b-5] Unless 

enjoined, Newman is reasonably likely to continue to violate the federal securities laws. 

THE DEFENDANT 

Newman age 51, resides in Hollywood, Florida. Newman worked for NIT as an 

unregistered broker and was paid approximately $216,787 in commissions. From 1991 to 2005, 

Newman was a registered representative associated with various registered broker-dealers. In 



3

17599, .

“Barry Weiss” to conceal his prior .

7.

May 2014, 

, incorporated in Florida in June 2016.  NIT’s principal place of business 

any capacity.  During the relevant period, NIT’s securities qualified as a “penny stock” because 

they did not meet any of the exceptions from the definition of a “penny stock,” as defined by 

securities were equity securities: (1) that were not an “NMS stock,” as defined in 17 C. . .

not meet any of the other exceptions from the definition of “penny stock” contained in Rule 3a51

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 3 of 14 

2005, without admitting or denying allegations, Newman settled NASD charges relating to sales 

practice violations, received a one-year suspension and was ordered to pay $10,000. In 2016, the 

Commission charged Newman with violations of Section 15(a) of the Exchange Act for acting as 

an unregistered broker-dealer in the offer and sale of securities of microcap issuer eCareer 

Holdings, Inc. (In the Matter of Mason D. Newman, AP File No. 3- Sept. 29, 2016) 

Newman agreed to settle the charges and was ordered to pay disgorgement of $169,000, 

prejudgment interest of $3,110, a civil penalty of $7,500 and was subject to a collateral bar, a 

penny stock bar, and an investment company prohibition. Newman has not paid the judgment 

amounts. During the time that Newman solicited investors on behalf of NIT, he used the alias 

Inc. 

Commission sanctions 

RELATED ENTITY 

NIT consisted of three entities: NIT Enterprises, Inc., incorporated in Delaware in 

NIT Enterprises, Inc., incorporated in Florida in May 2014, and NIT Enterprises FL, 

was in Palm Beach 

Gardens, Florida. NIT and its investment offerings were not registered with the Commission in 

Section 3(a)(51) of the Exchange Act and Rule 3a51-1 thereunder. Among other things, the 

FR 

242.600(b )( 47); (2) traded below five dollars per share during the relevant period; (3) whose issuer 

had net tangible assets and average revenue below the thresholds of Rule 3a51-1 (g)(l ); and ( 4) did 

1 under the Exchange Act. 



4

8.

.

9.

’

Distr .  

10.

11. 2015, , 

4.9

.

,

. .

., 19 24822 .

12. “genetic material solutions” in order to, among other 

, .  

, 

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 4 of 14 

JURISDICTION AND VENUE 

This Court has jurisdiction over this action pursuant to Sections 20(b ), 20( d) and 

22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d) and 77v(a)], and Sections 21(d), 21(e), and 

27(a) of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e) and 78aa(a)] 

This Court has personal jurisdiction over the Defendant and venue is proper in the 

Southern District of Florida because many of Newman s acts and transactions constituting the 

violations of the Securities Act and Exchange Act occurred in the Southern 

Moreover, Newman resides in the Southern District of Florida. 

ict of Florida 

In connection with the conduct alleged in this Complaint, Newman, directly or 

indirectly, singly or in concert with others, made use of the means or instruments of transportation 

and communication in interstate commerce, and the mails. 

FACTUAL ALLEGATIONS 

A. NIT Fraudulent Scheme 

Beginning at least as early as March NIT Newman and others executed a 

fraudulent scheme through which they raised at least $ million from investors in the Southern 

District of Florida and nationwide The NIT fraud scheme did not cease until November 2019, 

when the Commission filed a complaint charging NIT, its CEO and two other unregistered brokers 

with securities fraud on an emergency basis in order to stop the ongoing fraud SEC v NIT 

Enterprises, et.al -CV- -CMA (S.D. Fla ). 

NIT claimed to be developing 

things, produce lightweight protection garments that would protect against exposure to damaging 

radiation with medical and military applications NIT claimed to have several agreements or 

partnerships with other entities that were assisting with the testing and production of its protection 

garments. In offering materials intended to lure prospective investors into investing NIT made it 



5

.

capital for design production efforts and materials, “until profits break even with 

costs as production grows.”

13.

NIT’s website.  

company, its directors and management, NIT’s technology and various business relationships 

14. NIT’s website and Executive Summary 

regarding NIT’s timing for going public.  For example, a June 2016 investo

NIT “plans to enter the public market, filing Form S 2, 2016.”  

2019, NIT’s website stated the company “has prepared an S

company.”

15. NIT’s subscription agreement d

. 

.

’s Solicitation of Investors

16. hired by NIT’s CEO .  

“cold call” scripts as well as sales materials to use when soliciting investors.  

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 5 of 14 

appear that funds raised from investors would be directed to research and development efforts 

For example, in 2018 and 2019, NIT sent investors several updates that referenced the need to 

raise additional 

NIT followed up on investor solicitations by providing prospective investors with 

an NIT Executive Summary, a stock subscription agreement and a link to further information on 

The Executive Summary purported to provide general information about the 

to 

further its research and development, and ultimate production, of its protection garments and 

materials. 

made inconsistent representations 

r update stated that 

-1 (IPO) in Q- As late as November 

-1 registration for the SEC. With this 

filing expected m 2018, NIT would become an independent full reporting, audited, public 

state that the investor had a substantive and pre­

existing relationship with NIT before investing However, this was far from the truth. Most 

investors solicited had never heard of NIT before the initial cold-call solicitation they received 

from Newman or another NIT sales agent 

B. Newman 

Newman was to solicit investors Newman was provided with 

Newman acted as an 



6

,

, 

“Barry Weiss.”

.

17.

NIT’s value and business prospects, .

18.

with him in previous private offerings “free” shares in NIT to .  

the “free” would 

.

19.

an S 1 

.

20. NIT’s website and Executive Summary provided to investors contained at times 

inconsistent representations regarding NIT’s timing for going public.  For example, a June 2016 

hat NIT “plans to enter the public market, filing Form S 2, 

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 6 of 14 

unregistered broker by soliciting investors participating in the sale of NIT stock, and receiving 

commissions. After the Commission prohibited Newman from associating with a broker or dealer 

and from participating in penny stock offerings in September 2016 Newman continued to engage 

in the prohibited conduct while masking his true identity using the alias 

C Material Misrepresentations and Omissions to Investors and Other Deceptive 
Conduct 

Newman sold NIT stock to investors usmg high-pressure sales tactics that 

misrepresented such as claims that an NIT IPO was imminent 

Newman made baseless claims that the NIT shares were discounted for varying reasons and that 

the true value of the shares were much higher, when in fact, they were not. 

Newman solicited investors who had invested with him in prior private offerings 

and cold-called investors from lead lists. At times, Newman offered investors who had invested 

make up for past losses Once the 

investor received NIT shares, Newman solicit the investor to further invest in 

NIT utilizing misrepresentations and omissions 

Throughout his years soliciting investors for NIT, Newman continually 

misrepresented that an NIT IPO would occur in the near future. This misrepresentation was made 

by NIT, its CEO, and unregistered sales agents like Newman, orally and through the use of written 

offering materials, which Newman would have NIT send to investors after the solicitation. In fact, 

NIT made no effort to take the company public and never filed 

the Commission 

investor update stated t 

- registration statement with 

-1 (IPO) in Q-



7

2016.”  In October 2019, NIT’s website (which was not updated), stated the company “has 

2018

, public company.” (emphasis added).  The NIT 2017 

by 

21.

misrepresentations about the timing of NIT’s purported IPO. , 

22.

23.

Commission’s bar order.

by using the name “ ,”

.

5

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 7 of 14 

prepared an S-1 registration for the SEC. With this filing expected in 

an independent full reporting, audited 

, NIT would become 

Executive Summary sent to investors contained the same statement with a 2017 expected filing 

date. Numerous investors were falsely told Newman that NIT was a good investment because 

the company would be conducting an IPO. Ultimately, NIT never filed a registration statement 

with the Commission for a public offering of securities, much less had such a registration statement 

declared effective. 

with his 

Newman also made baseless and contradictory price projections in conjunction 

To at least one investor 

Newman offered NIT shares at a rate of2 shares for the price of 1. 

NIT and its CEO paid Newman transaction-based compensation in the form of 

commissions of approximately 30% of the investor funds he raised. Newman did not disclose to 

investors that he would be receiving such large commissions. 

In September 2016, the Commission barred Newman, which, as he knew, included 

bars prohibiting him from acting as or associating with a broker or dealer or participating in penny 

stock offerings. Nevertheless, shortly after the institution of his bars, Newman continued to act as 

a broker or dealer by soliciting investors to purchase NIT stock, a penny stock, in violation of the 

Newman deliberately omitted disclosing his disciplinary history and 

concealed his true identity from investors 

solicitations of investors 

CLAIMS FOR RELIEF 

COUNTI 

Barry Weiss an alias, in 

Violations of Sections (a) and S(c) of the Securities Act 



8

24. 1 23

25.

26.

2019, 

27.

.

1

28. 23

. 

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 8 of 14 

The Commission repeats and realleges Paragraphs through of this Complaint 

as if fully set forth herein. 

No registration statement was filed or in effect with the Commission pursuant to 

the Securities Act with respect to the securities and transactions described in this Complaint and 

no exemption from registration existed with respect to these securities and transactions. 

From at least as early as February 2015 and continuing through at least September 

Newman, directly and indirectly: 

(a) made use of means or instruments of transportation or communication in 

interstate commerce or of the mails to sell securities as described herein, through the use or 

medium of a prospectus or otherwise; 

(b) carried securities or caused such securities, as described herein, to be carried 

through the mails or in interstate commerce, by any means or instruments of transportation, for the 

purpose of sale or delivery after sale; or 

( c) made use of means or instruments of transportation or communication in 

interstate commerce or of the mails to offer to sell or offer to buy through the use or medium of a 

prospectus or otherwise, as described herein, without a registration statement having been filed or 

being in effect with the Commission as to such securities. 

By reason of the foregoing, Newman violated and, unless enjoined, is reasonably 

likely to continue to violate, Sections 5(a) and 5(c) of the Securities Act [15 U.S.C §§ 77e(a) and 

77e(c)] 

COUNT II 
Fraud in the Offer or Sale of Securities in Violation of 

Section 17(a)( ) of the Securities Act 

The Commission repeats and realleges Paragraphs 1 through of this Complaint 

as if fully set forth herein 



9

29. 2015 

2019, , d ,

,

30. v ,

15 .

2

31. 23

32. 2015 2019, 

, , by 

33. ,

2 15 77 2 .

34. 23

35.

2019, , ,

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 9 of 14 

From at least as early as February and continuing through at least September 

Newman irectly and indirectly, in the offer or sale of securities by use of any means or 

instruments of transportation or communication in interstate commerce or by use of the mails did 

knowingly or recklessly employ devices, schemes or artifices to defraud. 

By reason of the foregoing, Newman iolated and, unless enjoined is reasonably 

likely to continue to violate, Section 17(a)(l) of the Securities Act [ U.S.C. § 77q(a)(l)] 

COUNT III 
Fraud in the Off er or Sale of Securities in 

Violation of Section 17{a){ ) of the Securities Act 

The Commission repeats and realleges Paragraphs 1 through of this Complaint 

as if fully set forth herein. 

From as early as February and continuing through at least September 

Newman directly and indirectly, in the offer or sale of securities the use of any means or 

instruments of transportation or communication in interstate commerce or by use of the mails, 

negligently obtained money or property by means of untrue statements of material facts and 

omissions 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. 

By reason of the foregoing, Newman violated and unless enjoined, is reasonably 

likely to continue to violate, Section 17(a)( ) of the Securities Act [ U.S.C. § q(a)( )] 

COUNT IV 
Fraud in the Off er or Sale of Securities in 

Violation of Section 17{a){3) of the Securities Act 

The Commission repeats and realleges Paragraphs 1 through of this Complaint 

as if fully set forth herein. 

From at least as early as February 2015 and continuing through at least September 

Newman directly and indirectly, in the offer or sale of securities by use of any means or 



10

36.

.

5

37. 23

38. 2015

2019, 

,

,

39. v ,

5 b 5 .

Connectio
Section 10(b) 

40. 23

41. 2015 2019, 

, 

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 10 of 14 

instruments of transportation or communication in interstate commerce or by use of the mails, 

negligently engaged in transactions, practices, or courses of business which operated, are now 

operating or will operate as a fraud or deceit upon the purchasers. 

By reason of the foregoing Newman violated and, unless enjoined, is reasonably 

likely to continue to violate Section 17(a)(3) of the Securities Act [15 U.S.C. § 77q(a)(3)] 

COUNTV 
Fraud in Connection with the Purchase or Sale of Securities in 

Violation of Section 1 O{b) and Rule 1 Ob- {a) of the Exchange Act 

The Commission repeats and realleges Paragraphs 1 through of this Complaint 

as if fully set forth herein. 

From at least as early as February and continuing through at least September 

Newman, directly and indirectly, in connection with the purchase or sale of securities by use 

of any means and instrumentalities of interstate commerce or by use of the mails knowingly or 

recklessly employed devices, schemes or artifices to defraud in connection with the purchase or 

sale of securities. 

By reason of the foregoing, Newman iolated and unless enjoined, is reasonably 

likely to continue to violate, Section lO(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Exchange 

Act Rule lOb- (a) and [17 C.F.R. § 240.10 - (a)] 

COUNT VI 
Fraud in n with the Purchase or Sale of Securities in Violation of 

and Rule 1 Ob-S{b) of the Exchange Act 

The Commission realleges and incorporates paragraphs 1 through 

Complaint as if fully set forth herein. 

of this 

From as early as February and continuing through at least September 

Newman directly and indirectly, in connection with the purchase or sale of securities by use of any 

means and instrumentalities of interstate commerce or of the mails knowingly or recklessly made 



11

42. ,

b b .

Section 10(b) 
5

43. 23

44.

2019, 

45. v

, 1

0b . § 240.10b .

46. 23

.

47.

2019, , d

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 11 of 14 

untrue statements of material facts or omitted to state material facts in order to make the statements 

made, in light of the circumstance in which they were made, not misleading. 

By reason of the foregoing, Newman violated and unless enjoined, is reasonably 

likely to continue to violate, Section lO(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Exchange 

Act Rule lOb-5() [17 C.F.R. § 240.lOb-5( )] 

COUNT VII 
Fraud in Connection with the Purchase or Sale of Securities in Violation of 

and Rule lOb- (c) of the Exchange Act 

The Commission repeats and realleges paragraphs 1 through of this Complaint 

as if fully set forth herein. 

From at least as early as February 2015 and continuing through at least September 

Newman directly or indirectly, in connection with the purchase or sale of securities by the 

use of the means or instrumentalities of interstate commerce, or of the mails, knowingly or 

recklessly engaged in acts, practices, and courses of business which have operated, or would have 

operated as a fraud upon the purchasers of such securities. 

By reason of the foregoing, Newman iolated, and unless enjoined, is reasonably 

likely to continue to violate Section 0(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Exchange 

Act Rule 1 -5(c) [17 C.F R. -5(c)] 

COUNT VIII 
Unregistered Broker-Dealer Conduct in Violation of 

Section 15(a)(l) of the Exchange Act 

The Commission repeats and realleges paragraphs 1 through of this Complaint 

as if fully set forth herein 

From at least as early as February 2015 and continuing through at least September 

Newman irectly and indirectly, by the use of the mails or the means and instrumentalities 

of interstate commerce, effected transactions in, or induced or attempted to induce the purchase 



12

.

48.

,

49. 23

.

50. ,

2019, 

.

51.

.

, , 

U.S.C. §§ 78j(b), 78o(a)

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 12 of 14 

and sale of securities, while he was not not registered with the Commission as a broker or dealer 

or when he was not associated with an entity registered with the Commission as a broker or dealer 

in accordance with Section 15(b) of the Exchange Act [15 U.S.C. § 78o(b)] 

By reason of the foregoing, Newman violated and, unless enjoined, is reasonably 

likely to continue to violate Section 15(a)(l) of the Exchange Act [15 U.S.C. § 78o(a)(l)]. 

COUNT IX 
Violation of a Commission Order 

The Commission repeats and realleges paragraphs 1 through of this Complaint 

as if fully set forth herein 

Beginning on or about September 29, 2016 and continuing through at least 

September Newman acted as a broker or dealer and participated in an offering of a penny 

stock in contravention of a prior Commission order prohibiting such activities 

By reason of the foregoing, Newman violated and, unless enjoined, is reasonably 

likely to continue to violate, Section 15(b)(6)(B) of the Exchange Act [15 U.S.C. § 78o(b)(6)(B)] 

RELIEF REQUESTED 

WHEREFORE, the Commission respectfully requests the Court find that Newman 

committed the violations alleged, and: 

I. 
Permanent Injunction 

Issue a Permanent Injunction restraining and enjoining Newman his officers, agents, 

servants, employees, attorneys, and all persons in active concert or participation with him, and 

each of them, from violating Sections 5(a), 5(c), and 17(a) of the Securities Act [15 U.S.C. §§ 

77e(a), 77e(c), and 77q(a)] and Sections lO(b), 15(a)(l), and 15(b)(6)(B) of the Exchange Act [15 

(1), and 78o(b)(6)(B)] and Rule l0b-5 thereunder [17 C.F.R. § 240.l0b-

5]. 



13

.

§ .

.

.

.

29, 2020

0142859
6376

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 13 of 14 

II 
Civil Money Penalties 

Issue an Order directing Newman to pay civil money penalties pursuant to Section 20(d) 

of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d) of the Exchange Act [15 U.S.C. 

78(d)] 

III 
Disgorgement and Preiudgment Interest 

Issue an Order directing Newman to disgorge all ill-gotten gains, including prejudgment 

interest, resulting from the acts and/or courses of conduct complained of herein. 

IV 
Further Relief 

Grant such other and further relief as may be necessary and appropriate. 

V 
Retention of Jurisdiction 

Further, the Commission respectfully requests that the Court retain jurisdiction over this 

action in order to implement and carry out the terms of all orders and decrees that may hereby be 

entered, or to entertain any suitable application or motion by the Commission for additional relief 

within the jurisdiction of this Court. 

DEMANDFORJURYTRIAL 

The Commission hereby demands a trial by jury on any and all issues in this action so triable. 

Dated: September Respectfully submitted, 

By: s/Wilfredo Fernandez 
Wilfredo Fernandez 
Senior Trial Counsel 
Florida Bar No. 
Telephone: (305) 982-
Email: [email protected] 



14

982 6318

6300
536 4154

Case 0:20-cv-61976-XXXX Document 1 Entered on FLSD Docket 09/29/2020 Page 14 of 14 

Of Counsel: 
Eric E. Morales, Senior Counsel 
Securities and Exchange Commission 
801 Brickell Avenue, Suite 1950 
Miami, Florida 33131 

Michael J. Gonzalez 
Senior Counsel 
Florida Bar No. 110598 
Telephone: (305) 
Email: [email protected] 

Attorneys for Plaintiff 
SECURITIES AND EXCHANGE 
COMMISSION 
801 Brickell A venue, Suite 1950 
Miami, Florida 33131 
Telephone: (305) 982-
Facsimile: (305)