SEC v. Jack Brewer, No. 1:20-cv-06175, Southern District of New York (Aug. 6, 2020) — Complaint

MARC P. BERGER
REGIONAL DIRECTOR
Lara S. Mehraban
Preethi Krishnamurthy
Sheldon L. Pollock
Todd Brody
Bennett Ellenbogen
Lindsay S. Moilanen
Attorneys for Plaintiff
SECURITIES AND EXCHANGE COMMISSION
New York Regional Office
200 Vesey Street, Suite 400
New York, New York 10281-1022
(212) 336-0080 (Brody)
[email protected]

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

SECURITIES AND EXCHANGE COMMISSION,

     Plaintiff,

-against-

JACK BREWER,

                                                            Defendant.

COMPLAINT

20 Civ. 6175 (    )

JURY TRIAL DEMANDED

 Plaintiff Securities and Exchange Commission (“Commission”), for its Complaint against
Defendant Jack Brewer (“Brewer”), alleges as follows:
SUMMARY
1. In January 2017, Jack Brewer—the owner and principal of both a Commission-
registered investment adviser and a consulting firm, each bearing his last name—engaged in
unlawful insider trading in the stock of COPsync, Inc. (“COPsync”), among other securities law
violations.

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2. Brewer provided consulting and endorsement services to COPsync, a microcap
company that operated a communication network for law enforcement officers. Brewer did so
pursuant to at least two agreements he signed, which prohibited him from using or disclosing
confidential information he learned from the company. In return, Brewer and his companies
received payment in cash and shares of COPsync’s stock.
3. In approximately December 2016, Brewer, through this consulting and endorsement
relationship, learned that COPsync was engaged in efforts to sell two million shares of its freely-
trading stock in a private stock offering, likely at a significant discount to the market price. Brewer
knew that there would likely be a negative impact on COPsync’s stock price once the market learned
of the private offering.
4. In late December 2016, Brewer entered into a stock purchase agreement with
COPsync to buy shares in the offering. Under the agreement’s terms, Brewer agreed that he would
not buy or sell any shares of the company’s stock before the company issued a press release
announcing the offering to the public.
5. On January 4 and 5, 2017, before COPsync issued any such press release, Brewer
sold 100,000 shares of his pre-existing stock in the company at prices ranging from $1.01 to $1.16
per share, for proceeds of approximately $104,000.
6. On the morning of January 6, 2017, the company issued a press release announcing
that it had issued over 1.77 million shares of stock (including warrants to purchase additional shares)
in a private offering at an average price of $0.65 per share. At the end of that trading day, the market
price of the stock closed at $0.69 per share, a 30% decrease from the prior day’s closing price.
7. By unlawfully selling his shares on January 4 and 5 based on the material, non-public
information he had obtained, Brewer profited by approximately $35,000 more than he would have
had he sold his shares shortly after COPsync issued its press release.

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8. In addition, from at least 2015 until November 2017, Brewer aided and abetted his
investment advisory firm’s failure to design and enforce its written policies and procedures to
prevent the misuse of non-public information. For example, despite the firm’s written policies
requiring that the firm maintain a list of restricted stocks about which firm personnel had material,
non-public information and in which they would therefore not be permitted to trade, Brewer failed
to ensure that his firm maintained such a list.
9. From at least April 2015 through July 2017, Brewer also unlawfully acted as a
securities broker—including by working with microcap companies to provide advice on raising
capital, introducing the companies to sources of capital, identifying potential investors, and soliciting
investors for the companies—without being associated with a broker-dealer or being registered as a
broker with the Commission.
VIOLATIONS
10. By engaging in the conduct set forth in this Complaint, Brewer violated Section 10(b)
of the Securities Exchange Act of 1934 (the “Exchange Act”) [15 U.S.C. § 78j(b)] and Rule 10b-5
thereunder [17 C.F.R. § 240.10b-5], violated Exchange Act Section 15(a) [15 U.S.C. § 78o(a)], and
aided and abetted violations of Section 204A of the Investment Advisers Act of 1940 (“Advisers
Act”) [15 U.S.C. § 80b-4a] and Rule 204A-1 thereunder [17 C.F.R. § 275.204A-1].
11. Unless Brewer is permanently restrained and enjoined, he will engage in the acts,
practices, transactions, and courses of business set forth in this Complaint or in acts, practices,
transactions, and courses of business of similar type and object.
NATURE OF THE PROCEEDINGS AND RELIEF SOUGHT
12. The Commission brings this action pursuant to the authority conferred upon it by
Exchange Act Sections 21(d) and 21A(a) [15 U.S.C. §§ 78u(d) and 78u-1(a)] and Advisers Act
Section 209(d) [15 U.S.C. § 80b-9(d)].

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13. The Commission seeks a final judgment (a) permanently enjoining Brewer from
violating the federal securities laws and rules this Complaint alleges he violated; (b) ordering Brewer
to disgorge the ill-gotten gains he received with prejudgment interest thereon; (c) ordering Brewer to
pay civil money penalties pursuant to Exchange Act Sections 21A and 21(d)(3) [15 U.S.C. §§ 78u-1
and 78u(d)(3)] and Advisers Act Section 209(e) [15 U.S.C. § 80b-9(e)]; (d) prohibiting Brewer from
participating in any offering of a penny stock, pursuant to Exchange Act Section 21(d)(6) [15 U.S.C.
§ 78u(d)(6)]; and (e) ordering any other and further relief the Court may deem just and proper.
JURISDICTION AND VENUE
14. This Court has jurisdiction over this action pursuant to Exchange Act Section 27 [15
U.S.C. § 78aa] and Advisers Act Section 214 [15 U.S.C. § 80b-14].
15. Brewer, directly and indirectly, has made use of the means or instrumentalities of
interstate commerce or of the mails in connection with the transactions, acts, practices, and courses
of business alleged herein.
16. Venue lies in this District under Exchange Act Section 27 [15 U.S.C. § 78aa] and
Advisers Act Section 214 [15 U.S.C. § 80b-14]. Brewer transacted business in the Southern District
of  New York, and certain of  the acts, practices, transactions, and courses of  business alleged in this
Complaint occurred within this District. For example, Brewer attended COPsync’s Board of
Directors meeting in Manhattan on December 9, 2016; Brewer’s Manhattan-based broker placed
Brewer’s relevant trades in COPsync’s stock; and Brewer’s investment advisory firm had its principal
place of business in New York City.
THE DEFENDANT
17. Brewer, age 41, resides in Minnesota and Florida. From at least 2011, Brewer was
the president, chief executive officer, and portfolio manager of the Brewer Group Inc. (“Brewer
Group”), a consulting firm. From at least 2010 until November 2017, Brewer was also the principal,

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CEO, and portfolio manager of BSI Wealth Management LLC d/b/a Brewer Capital Management
(“Brewer Capital”), a Commission-registered investment adviser. Brewer is, or until recently has
been, the co-host of the digital podcast “Level Headed.” In addition, Brewer has been a regular
contributor to media networks, programs, and publications, including Yahoo Finance, CNBC, Fox
Business, CNN, and the American City Business Journals.
OTHER RELEVANT ENTITIES
18. Brewer Group is a Minnesota corporation and consulting firm with a portfolio
covering financial services, healthcare, agriculture, sports, media and entertainment. At all relevant
times, Brewer was the Brewer Group’s president, chief executive officer, and portfolio manager.
Brewer owns 100% of the Brewer Group.
19. Brewer & Associates Consulting LLC (“Brewer Consulting”) was at all relevant
times a wholly-owned subsidiary of the Brewer Group and has described itself as an “advisory firm
focused on providing tailored business development, marketing and event management services and
support for small-cap and middle market companies.” At all relevant times, Brewer was Brewer
Consulting’s CEO.
20. Brewer Capital was at all relevant times a Delaware limited liability company with
its principal place of business in New York, New York. Brewer Capital was founded in 2009. From
2010 through November 2017, Brewer Capital was registered with the Commission as an investment
adviser. According to its Form ADV dated October 30, 2017, filed with the Commission, Brewer
Capital’s managing member was Brewer Sports International, LLC, which Brewer managed and 80%
of which the Brewer Group owned. At all relevant times, Brewer was Brewer Capital’s CEO and
portfolio manager.
21. COPsync was a Delaware corporation with its principal place of business in New
Orleans, Louisiana for portions of the relevant period. At all relevant times, COPsync purported to

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operate the COPsync Network, a communication network for law enforcement officers. From at
least December 31, 2008 until July 23, 2018, COPsync’s common stock was registered under
Exchange Action Section 12(g). From July 1, 2008 to November 2015, COPsync’s common stock
was quoted on the OTCQB, an interdealer quotation service. From November 2015 through at least
January 2017, COPsync’s shares were listed on the NASDAQ Capital Market under the ticker
symbol “COYN.” On September 29, 2017, COPsync filed a Chapter 11 petition in the U.S.
Bankruptcy Court for the Eastern District of Louisiana. On July 23, 2018, the Commission revoked
the registration of COPsync’s common stock pursuant to Exchange Act Section 12(j). At all relevant
times, COPsync’s common stock met the definition of a “penny stock” under Exchange Act Section
3(a)(51) [15 U.S.C. § 78c(a)(51)] and Rule 3a-51-1 thereunder [17 C.F.R. § 240.3a51-1], because the
stock traded below five dollars per share and did not satisfy any of the exceptions to the definition
of “penny stock” set forth in Rule 3a-51-1.
FACTS
I. BACKGROUND
22. From approximately 2002 to 2006, Brewer played football in the National Football
League.
23. Upon his retirement from professional football, Brewer transitioned his career to the
financial services industry.
24. In approximately 2006, Brewer founded the Brewer Group.
25. In approximately 2007, Brewer became a registered representative of a large,
Commission-registered broker-dealer firm in its Private Client Group.
26. From approximately 2009 until 2011, Brewer served as a managing director of a
Commission-registered, private, biotech-focused investment bank.

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27. From approximately 2011 through 2015, Brewer worked as an associated person for
at least three different firms in the financial services industry, other than his affiliated entities.
28. At various times from 2007 through 2016, Brewer held Series 7, Series 66, and Series
79 securities licenses, which permitted him to undertake certain securities-related activities.
29. In approximately 2009, Brewer founded Brewer Capital.
30. From approximately 2010 through November 2017, while registered with the
Commission as an investment adviser, Brewer Capital provided investment advisory services to a
handful of high net-worth individuals, primarily professional athletes and former professional
athletes.
31. As of January 1, 2016, Brewer Capital had approximately $27 million in assets under
management.
II. BREWER CAPITAL’S WRITTEN SUPERVISORY PROCEDURES DESCRIBED
PROHIBITIONS ON INSIDER TRADING.

32. In both 2015 and 2016, Brewer Capital had written supervisory procedures.
33. Among other things, the written supervisory procedures for both years—which all
Brewer Capital personnel were required to read, acknowledge in writing, and follow—stated:
The legal prohibitions against ‘insider trading’ and [Brewer Capital]’s
professional responsibility forbid the use or disclosure by all
directors, officers and Access Persons of [Brewer Capital], for direct
or indirect personal gain or profit of ‘insider information’ received in
connection with the business of [Brewer Capital] or from any source.
Moreover, the use of material, non-public information in securities
transactions (‘insider trading’) or the communication of such inside
information to others (‘tipping’) may violate federal and/or state
securities laws. Such a violation of law could result in severe personal
consequences to the individuals involved....

34. The written supervisory procedures for both years further stated:
All persons associated with [Brewer Capital] are prohibited from
engaging in any securities transaction for their own benefit or the
benefit of others, while in possession of: (a) Material, non-public
information concerning such securities which is known to the any

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person by virtue of his or her position as an insider with respect to
the issuer of such securities....

35. The same written supervisory procedures explained that “a person can be a
‘temporary insider’ if he or she enters into a special confidential relationship in the conduct of a
company’s affairs and as a result is given access to information solely for the company’s purposes”
and that “consultants” and “advisers” can be temporary insiders.
III. BREWER PROVIDED CONSULTING AND OTHER SERVICES TO COPSYNC.
36. On approximately August 12, 2015, Brewer Consulting, the Brewer Group’s wholly-
owned subsidiary, entered into a consulting agreement with COPsync, effective as of that date.
37. Brewer signed the agreement on Brewer Consulting’s behalf as its CEO.
38. The agreement described COPsync as a “publically held company... (OTCQB:
COYN).”
39. Under the agreement’s terms, Brewer Consulting agreed to provide “global business
development and marketing” consulting services to COPsync at its request, including by
“participat[ing] in [COPsync] conference calls and meetings as requested.”
40. In exchange for its services, Brewer Consulting stood to receive $4,500 per month
from COPsync (to be accrued and payable only after COPsync’s shares of common stock were
“uplist[ed]” on the NASDAQ exchange) plus one million shares of COPsync’s common stock.
41. The agreement lasted until the earlier of twelve months from the effective date or
the termination by either party with thirty days’ written notice to the other party.
42. The agreement contained a confidentiality provision that lasted for at least three
years:
[Brewer Consulting] will maintain in confidence all proprietary, non-
published information obtained by [Brewer Consulting] with respect
to [COPsync] during the course of the performance of [Brewer
Consulting]’s services hereunder, and [Brewer Consulting] shall not
use any of the same for its own benefit or disclose any of the same to

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any third party, without [COPsync’s] prior written consent, both
during and within three (3) years after the term of this Agreement.
For the purposes of this Agreement, “Confidential Information”
means information about the Company’s business activities that is
proprietary and confidential, which shall include all business,
financial, technical and other information of [COPsync]....
43. On approximately December 1, 2015, Brewer Consulting and COPsync expanded
the consulting agreement by entering into an “Expansion Advisory Agreement,” effective as of that
date.
44. Brewer signed the expansion agreement on Brewer Consulting’s behalf as its CEO.
45. Under the agreement’s terms, Brewer Consulting agreed to provide additional
services at COPsync’s request, including “[a]ssisting in managing ongoing marketing efforts which
include working with [COPsync]’s investor relations strategic partners in an effort to increase market
awareness for [COPsync]’s publicly traded securities.”
46. In return, COPsync agreed to make monthly payments of $4,000 to Brewer
Consulting and to issue an additional 20,000 shares of COPsync’s common stock directly to the
Brewer Group in two equal installments.
47. The expansion agreement extended the original consulting agreement until the earlier
of twelve months from the expansion agreement’s effective date—that is, November 30, 2016—or
termination in writing by either party.
48. The expansion agreement ratified all other provisions in the original agreement,
including the three-year confidentiality provision.
49. On approximately January 1, 2016, Brewer personally entered into an endorsement
agreement with COPsync, effective as of that date.
50. Brewer signed the agreement on his own behalf, noting underneath his title of CEO
of the Brewer Group.

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51. The endorsement agreement provided that Brewer would “[e]ndorse and serve as a
public figure for the Company” and would “work with [COPsync] to assist with enhancing
[COPsync] brand recognition of the COPsync technology, services and product line”—including by
“[a]ttend[ing] and participat[ing] in key, high-level [COPsync] meetings and calls upon occasion.”
52. In return, the endorsement agreement required COPsync to pay Brewer $1,500,000
either in four equal, quarterly installments or partly or wholly through certain “commission
payments” Brewer stood to receive under the agreement.
53. As further payment, the endorsement agreement required COPsync to issue 200,000
shares of COPsync’s restricted common stock—in essence, stock that Brewer had to hold for a
certain period of time before he could sell the stock into the public market, unlike freely-trading
shares that could be sold upon receipt—to Brewer in two equal installments over six months.
54. The endorsement agreement also contained a confidentiality clause that included the
following terms:
[Brewer] acknowledges and understands that in [his] capacity as [an
e]ndorser, [he] will have access to [COPsync]’s and [COPsync]’s [sic]
confidential and proprietary information (the ‘Confidential
Information’). [Brewer] agrees to hold in trust and confidence all
Confidential Information disclosed to [him] and further agrees not to
exploit or disclose the Confidential Information directly or indirectly
for any purpose other than for [Brewer]’s work with [COPsync].
55. The endorsement agreement had a term of 18 months from the effective date—that
is, it lasted until June 30, 2017—absent an earlier written termination by either party in writing.
56. COPsync issued the first 100,000 shares of its restricted stock to Brewer pursuant to
the endorsement agreement on approximately February 12, 2016.
57. Brewer exchanged these 100,000 restricted shares for freely-trading COPsync shares
on approximately November 30, 2016.

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IV. BREWER PARTICIPATED IN COPSYNC’S CONFIDENTIAL PLANS TO
RAISE CAPITAL THROUGH A PRIVATE STOCK OFFERING.
58. On July 1, 2016, COPsync filed a “shelf” registration statement with the
Commission on Form S-3 in connection with COPsync’s potential issuance of up to $25 million of
its securities
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59. This “shelf” registration statement covered COPsync’s potential securities
offerings—including “common stock, preferred stock, warrants and rights, or any combination”—
“from time to time in indeterminate amounts and at indeterminate times.”
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60. The registration statement made clear that COPsync “may distribute” the securities
“in one or more transactions” through various unspecified pricing mechanisms: “a fixed price or
prices, which may be changed,” “market prices prevailing at the time of sale,” “prices related to such
prevailing market prices,” or “negotiated prices.”
61. The registration statement further noted that the “estimated expenses” in connection
with any issuance and distribution of securities described in the statement were “not presently
known because they depend upon, among other things, the number of offerings that will be made
pursuant to this registration statement, the amount and type of securities being offered and the
timing of such offerings.”
62. On July 13, 2016, the Commission declared COPsync’s “shelf” registration statement
effective.

1
  A “shelf” registration statement allows an issuer in certain circumstances to offer securities
to the public without a separate prospectus for each offering but instead with a single prospectus for
multiple, indeterminate future offerings.
2
  A warrant gives the holder the right to buy or sell a security, such as stock, at a certain price
before the warrant’s expiration.

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63. On August 19, 2016, COPsync’s Board of Directors (the “Board”) held an in-person
meeting at the company’s office in Addison, Texas.
64. Brewer attended the entire meeting at the Board’s invitation.
65. At the meeting, the Board made no firm decisions about how to finance COPsync
but discussed a potential sequence of funding events, including a bridge loan in August 2016 and an
equity raise—that is, issuing stock to obtain capital—in September 2016.
66. The Board also discussed the creation of a special financing committee to explore
COPsync’s financing options and invited Brewer to participate as an advisor to the committee.
67. On November 14, 2016, COPsync filed its quarterly report on Form 10-Q for the
quarter ending September 30, 2016.
68. The Form 10-Q mentioned the Form S-3 registration statement but, like the Form S-
3, did not specify any planned offering of stock, other than that stock “may be issued by [COPsync]
from time to time in indeterminate amounts and at indeterminate times.”
69. On December 6, 2016, a firm that had performed investment banking functions for
COPsync (the “Investment Bank”) entered into an agreement—marked “confidential”—with
COPsync to serve as its placement agent for a potential offering of two million shares of the
company’s stock.
70. On December 8, 2016, COPsync’s common stock price closed at $0.89 per share.
71. On December 9, 2016, COPsync’s Board held a meeting in New York, New York, in
which some participants participated by phone and others appeared in person.
72. Brewer attended the Board meeting in person.
73. At the meeting, the Board decided that COPsync would offer up to two million
freely-trading shares of its common stock, with each share sold as a “unit” with two warrants. Each
warrant would entitle the holder to purchase an additional share of common stock.

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74. The Board proposed that the purchase price for each of these “units” would be the
lesser of (a) the ten-day volume weighted average price of the common stock, measured as of the
close of the market on the offering date, or (b) $0.90. The Board further proposed that the first of
the two warrants in each “unit” would be exercisable for cash within six months at a price of $1.10
per share of common stock, and that the second warrant in each “unit” would be exercisable in cash
or in a cashless exercise transaction within five years at a price of $1.25 per share of common stock.
75. At the same meeting, the Board established a special pricing committee, consisting
solely of COPsync’s then-chief executive officer, to determine the final terms and conditions of the
offering, including the pricing of the securities offering within specified parameters. Among other
things, the Board resolved that the “units” could be sold at up to a 30% discount to the market price
of COPsync’s common stock without any further Board action or ratification.
76. This information was confidential and non-public.
77. On the afternoon of December 12, 2016, COPsync’s CEO emailed Brewer
documents relating to the proposed offering, including an investor presentation and a “Summary of
Proposed Offering Terms for COPSync, Inc.”
78. The investor presentation, which itself contained a brief summary of the offering,
bore the following legend in capital letters on the bottom of each page: “Strictly confidential. Not
for distribution to the public.”
79. The second page of the investor presentation further stated: “This presentation is
strictly confidential and may not be distributed to any other person, and may not be reproduced or
published, in whole or in part, in any form. Failure to comply with this restriction may constitute a
violation of applicable securities laws.”
80. The separate summary of the proposed offering terms made clear, among other
things, that COPsync proposed to offer up to two million freely-trading shares of its common stock

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in units comprised of one share of stock and two warrants and that the proposed purchase price for
each of these “units” would be the lesser of the ten-day volume weighted average price of the
common stock, measured as of the close of the market on the offering date, or $0.90.
81. That afternoon, Brewer forwarded the email and attachments to the co-manager of
an emerging growth fund (the “Fund Manager”) with whom Brewer had done business before and
copied two Brewer Group colleagues. Brewer wrote: “Let’s discuss again if you can.”
82. Within an hour, one of Brewer’s colleagues replied to Brewer’s email and pointed
out, among other things, that any purchasers in the offering would promptly sell their shares after
receiving them once the transaction closed:
Terms will end up being expensive money – this will be a death spiral
if he [COPsync’s CEO] can even raise the capital. For it not to be – it
would have to be raised from complete new-to-the-game retail
investors... Warrants will act as the asset and call option to upside
for investors, as the common gets flushed into market on close of
transactions.
83. On December 21, 2016, Brewer emailed COPsync’s corporate counsel and asked
her: “Any eta on the terms of the equity financing? Is that still happening this week?”
84. Later the same day, Brewer received another email from the Fund Manager, who
noted “the discounted purchase or any downside movement on the stock”—meaning the offering’s
discounted share price and COPsync’s expected stock price decline after the company announced
the offering and the investors in the offering sold their shares.
85. In an email that evening, Brewer made clear to the Fund Manager that the Brewer
Group planned to invest in the COPsync offering.
86. On December 21, 2016, Brewer received by email a copy of the securities purchase
agreement (the “Purchase Agreement”) to participate in COPsync’s offering.
87. The Purchase Agreement contained a clause entitled “Certain Transactions and
Confidentiality,” by which each purchaser in the offering agreed:

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[N]either it nor any [a]ffiliate acting on its behalf or pursuant to any understanding
with it will execute any purchases or sales, including [s]hort [s]ales of any of
[COPsync’s] securities during the period commencing with the execution of this
Agreement and ending at such time that the transactions contemplated by this
Agreement are first publicly announced pursuant to the initial press release
[described above]. Each [p]urchaser... covenants that until such time as the
transactions contemplated by this Agreement are publicly disclosed by [COPsync]
pursuant to the initial press release [described above], such [p]urchaser will maintain
the confidentiality of the existence and terms of this transaction....
88. On December 28, 2016, the Brewer Group’s chief operating officer emailed Brewer’s
signed signature page on the Purchase Agreement, which Brewer had signed on the Brewer Group’s
behalf, to COPsync and copied Brewer on the email.
V. BREWER SOLD SHARES OF COPSYNC TO MAXIMIZE HIS
PROFIT BEFORE COPSYNC ANNOUNCED THE OFFERING.
89. On or about January 4, 2017, Brewer directly or indirectly instructed his Manhattan-
based broker to sell shares of COPsync from Brewer’s personal brokerage account.
90. On January 4, 2017, Brewer’s broker executed Brewer’s sale of 5,000 shares of
COPsync at a price of approximately $1.01 per share, for total proceeds of $5,063.88.
91. That evening, Brewer received an email from his broker informing him that the sale
of the COPsync shares had been executed and that the broker would sell more shares the next day.
92. On January 5, 2017, Brewer’s broker sold an additional 95,000 shares of COPsync
from Brewer’s brokerage account at prices ranging from approximately $1.01 to $1.16 per share, for
total proceeds of $99,114.29.
93. Before selling his stock, Brewer did not seek COPsync’s consent to do so or disclose
to COPsync that he intended to do so.
94. On January 5, 2017, COPsync’s shares of common stock closed at a price of $1.03
per share.
95. On the morning of January 6, 2017, COPsync issued a press release announcing the
offering and disclosing that it had sold 1,772,614 shares of common stock, as well as warrants to

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purchase additional shares. The press release stated that the price to purchase one common stock
share, one Class A warrant, and one Class B warrant combined was $0.65.
96. Over the course of the day, the volume of trading in COPsync’s stock more than
tripled from the previous day, and the stock price closed that day at $0.69 per share—approximately
a 30% drop from the prior day’s closing price.
97. By selling 100,000 shares on January 4 and 5, rather than waiting until after COPsync
announced the offering on January 6, Brewer profited by approximately $35,000 more than he
otherwise would have.
98. The Brewer Group never obtained any COPsync stock pursuant to the Purchase
Agreement. Shortly after the offering closed, the Brewer Group assigned its rights to purchase
COPsync stock under the Purchase Agreement to a third party.
99. Later in January 2017, the Financial Industry Regulatory Authority, a self-regulatory
organization, began a review of trading in COPsync shares around the time of the offering.
100. As part of this review, COPsync reached out to certain individuals who had been
privy to information about events leading up to the offering announcement, including Brewer.
101. Brewer refused to respond to COPsync’s inquiry.
VI. BREWER AIDED AND ABETTED BREWER CAPITAL’S FAILURE TO
REASONABLY ESTABLISH AND ENFORCE WRITTEN POLICIES
CONCERNING THE MISUSE OF MATERIAL, NONPUBLIC INFORMATION.

A. Background: Advisers Act Section 204A and Rule 204A-1 Thereunder

102. Advisers Act Section 204A and Rule 204A-1 together serve to ensure that
investment advisers establish, maintain, and enforce written policies to prevent advisory firms, their
control persons, and their employees from misusing material, nonpublic information.
103. Advisers Act Section 204A requires investment advisers to establish, maintain, and
enforce written policies and procedures reasonably designed, taking into consideration the nature of

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the investment adviser’s business, to prevent the misuse of material, nonpublic information by the
investment adviser or any person associated with the investment adviser, including any person who
directly or indirectly controls the investment adviser.
104. Rule 204A-1 requires investment advisers to “establish, maintain and enforce a
written code of ethics.”
105. The required code of ethics must include at least (a) a standard of business conduct,
reflecting the adviser’s fiduciary obligations, that the adviser requires of its supervised persons, (b)
provisions that require persons with access to certain nonpublic information or persons involved in
making securities recommendations to clients to periodically report personal securities transactions
and holdings, and (c) provisions requiring supervised persons to acknowledge in writing their receipt
of the code of ethics.
B. Brewer Capital Failed to Reasonably Design and Enforce Its Code of Ethics
and Written Supervisory Procedures, and Brewer Aided and Abetted Brewer
Capital’s Failure.
106. From at least 2015 through November 2017, Brewer, as Brewer Capital’s manager
and majority owner (through his ownership of the Brewer Group), made Brewer Capital’s trading
decisions.
107. During the same period, Brewer and others who worked at Brewer Capital also
performed work for one or more of Brewer Capital’s affiliated firms under the Brewer Group
umbrella, including Brewer Consulting.
108. During the same period, Brewer and other Brewer Capital employees repeatedly
obtained material, non-public information about securities based on their work on behalf of
securities issuers for Brewer Capital’s affiliated firms, including Brewer Consulting.
109. For example, Brewer and others at Brewer Capital obtained material non-public
information about COPsync pursuant to the consulting agreement between Brewer Consulting and

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COPsync described above in paragraphs 36 through 48 and pursuant to the endorsement agreement
between Brewer and COPsync described above in paragraphs 49 through 55.
110. During the same period, Brewer Capital had written supervisory procedures whose
purpose was to “provide personnel with an awareness of the requirements of the law, rules and
regulations governing investment adviser and investment-Advisory representative activities; and ...
provide procedural means necessary to ensure that the operations of the Firm meet those
requirements,” including the descriptions of insider trading prohibitions described above in
paragraphs 32 through 35.
111. The written supervisory procedures for at least 2015 and 2016 provided that Brewer
Capital’s “access persons”—which included employees, directors, officers, partners and members of
Brewer Capital who had access to non-public information regarding advisory clients’ purchases or
sales of securities or who made securities recommendations to clients—were required, when they
had any question as to whether information in their possession was material or non-public, to
“[r]eport the matter immediately to the CCO [chief compliance officer]” and “[r]efrain from the
purchase or sale of [the] securities on behalf of themselves or others.”
112. The same supervisory procedures also provided that a Brewer Capital access person
“may not buy or sell any security in which the person had a beneficial ownership unless the
transaction occurred in an exempted security or the employee has complied with the Personal
Security Transaction Policy.” That policy in turn required the access person to complete Brewer
Capital’s pre-clearance form and submit that form to the chief compliance officer (“CCO”) for
review before making any such securities transaction.
113. These supervisory procedures further provided that Brewer Capital access persons
were required to have written pre-clearance for personal securities transactions when the securities
were (1) on the restricted security list—that is, a list of securities that a firm prohibits its employees

19

from buying or selling, typically because of access to material, non-public information about the
securities; (2) on the security watch list—a list of securities that a company selects for special
surveillance as to potential transactions by employees; (3) offered in an initial public offering; (4)
offered in a private placement—a sale of securities to pre-selected investors, rather than to the
public; or (5) offered in a limited offering—an offering exempt from registration under the
Securities Act of 1933. In each of those instances, the supervisory procedures required access
persons to complete Brewer Capital’s pre-clearance form.
114. From at least 2015 through November 2017, Brewer Capital’s written supervisory
procedures included a Code of Ethics.
115. The Code of Ethics provided that access persons “may be subject to a blackout
period from trading” in thinly traded securities, defined as securities with average daily trading
volume below 100,000 shares.
116. The Code of Ethics further made clear: “[Brewer Capital] and its employees generally
may not participate in private placements or initial public offerings (IPOs) without pre-clearance
from [Brewer Capital]’s Compliance Officer.”
117. In 2016, Brewer held joint responsibility, together with Brewer Capital’s CCO, for
reading and updating Brewer Capital’s supervisory procedures and Code of Ethics.
118. In 2016, Brewer and the CCO likewise held joint responsibility for conducting the
annual employee compliance training.
119. From at least 2015 through November 2017, Brewer Capital did not enforce the
procedures in the written supervisory procedures and Code of Ethics described above in paragraphs
32 through 35 and 111 through116.
120. For example, during at least that period, Brewer Capital did not keep a restricted list
or watch list to track stocks for which the firm had obtained material, non-public information.

20

121. During at least the same period, Brewer Capital did not impose blackout periods for
trading thinly traded securities.
122. Before July 2017, Brewer Capital did not enforce its pre-clearance policies for
trading.
123. From at least 2015 through at least July 2017, Brewer never submitted any Personal
Trading Pre-Clearance forms and from at least 2015 through November 2017, Brewer never
consulted any restricted list or watch list before engaging in securities transactions, because no such
lists existed.
124. From 2015 through November 2017, Brewer (on Brewer Consulting’s behalf)
negotiated and entered into consulting agreements with at least nine issuers, pursuant to which
Brewer Consulting performed services and received or had the potential of receiving material non-
public information.
125. From at least 2015 through November 2017, Brewer negotiated and entered into
personal endorsement agreements with three of those same issuers.
126. Brewer Capital’s 2015 and 2016 written supervisory procedures and Code of Ethics
failed to establish procedures reasonably designed to prevent Brewer and other Brewer Capital
employees from misusing material, non-public information they obtained as a result of their
responsibilities at Brewer Capital’s affiliated entities.
VII. BREWER ACTED AS AN UNREGISTERED BROKER.
127. From April 2015 through July 2017, Brewer was not associated with any broker-
dealer or registered with the Commission as a broker-dealer.
128. During this period, Brewer worked with microcap companies to provide advice on
raising capital, to introduce the companies to sources of capital, and to identify potential investors.

21

129. For example, on June 26, 2015, Brewer Consulting entered into an agreement with a
microcap company, Issuer A, to provide global business development and marketing consulting
services, including to “work on the Company’s behalf with investment banking firms and potential
investors....”
130. This agreement was extended several times.
131. For this and other services, Issuer A agreed to pay Brewer Consulting an advisory fee
of $2,000 per month and to issue 500,000 shares of restricted common stock to the Brewer Group
each quarter.
132. As reported in Issuer A’s annual report on Form 10-K for the year ended December
31, 2016, “the Brewer Group ... arranged a number of meetings with various hedge funds in New
York to assist with the funding of the company.”
133. Similarly, Brewer Consulting entered into an agreement, effective February 10, 2017,
with another microcap company, Issuer B, to represent the company by “providing ongoing support
including, but not limited to, facilitating introductory meetings with financial firms and institutional
investors.”
134. For this and other services, Issuer B agreed to issue 800,000 shares of restricted
common stock and 800,000 warrants spread out over quarterly payments to the Brewer Group.
135. Issuer B’s Chairman of the Board of Directors repeatedly asked Brewer to introduce
him to potential investors.
136. Brewer repeatedly solicited investments in Issuer B.
137. Similarly, as a consultant to COPsync, Brewer identified and communicated with
potential purchasers of COPsync’s securities, solicited securities transactions, and had his advisory
clients purchase COPsync securities.

22

138. For these and other services, Brewer received cash and COPsync shares from
COPsync.
139. In August 2016, COPsync’s CEO requested that the Brewer Group provide a bullet
point list of the top accomplishments that the Brewer Group had achieved for COPsync because the
CEO was expecting a “rigorous review” of the relationship from COPsync’s Board and wanted help
articulating “the value created versus the expense incurred.”
140. The Brewer Group’s response stated that Brewer Consulting was “instrumental in
COPsync’s NASDAQ uplisting and ongoing capital markets support.”
141. The response further explained that Brewer Consulting “provides ongoing capital
markets support including facilitating introductions to various investment bankers including [the
Investment Bank] surrounding COPsync’s uplisting transaction as well as to several private
investors, research analysts, etc. leading up to, during and following the Company’s successful uplist
to the NASDAQ stock exchange market.”
142. In a follow-up email reviewed by Brewer, the Brewer Group added:
Given his background, vast network, and extremely established
relationships in the space including with public and private investors
and high-net-worth individuals, Jack Brewer was instrumental in
helping COPSync with the NASDAQ uplisting process and provides
ongoing capital markets support including facilitating introduction to
various investment bankers ... surrounding COPSync’s uplisting
transaction as well as to several private investors, research analysts,
etc. leading up to, during and following the Company’s successful
uplist to the NASDAQ stock exchange market.
143. The email also included a breakdown of the nearly $2.8 million of investments in
COPsync securities made as a result of Brewer’s introductions.
144. This amount included investments made by four Brewer Capital clients as well as
“over $500,000 in open market support from various investors.”

23

FIRST CLAIM FOR RELIEF
Violations of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder

145. The Commission re-alleges and incorporates by reference here the allegations in
paragraphs 1 through 8, 15 through 101, and 106 through 126.
146. Defendant, directly or indirectly, in connection with the purchase or sale of securities
and by the use of means or instrumentalities of interstate commerce, or the mails, or the facilities of
a national securities exchange, knowingly or recklessly has (i) employed one or more devices,
schemes, or artifices to defraud, (ii) made one or more untrue statements of a material fact or
omitted to state one or more material facts necessary in order to make the statements made, in light
of the circumstances under which they were made, not misleading, and/or (iii) engaged in one or
more acts, practices, or courses of business which operated or would operate as a fraud or deceit
upon other persons.
147. By reason of the foregoing, Defendant, directly or indirectly, has violated and, unless
enjoined, will again violate Exchange Act Section 10(b) [15 U.S.C. § 78j(b)] and Rule 10b-5
thereunder [17 C.F.R. § 240.10b-5].
SECOND CLAIM FOR RELIEF
Aiding and Abetting Violations of Section 204A of the Advisers Act
and Rule 204A-1 Thereunder

148. The Commission re-alleges and incorporates by reference here the allegations in
paragraphs 1 through 8, 15 through 126, and 128 through 138.
149. Brewer Capital, while acting as an investment adviser, failed to establish, maintain,
and enforce written policies and procedures reasonably designed, taking into consideration the
nature of its business, to prevent the misuse in violation of the Advisers Act [15 U.S.C. § 80b-1 et
seq.] or the Exchange Act [15 U.S.C. § 78a et seq.], or the rules or regulations thereunder, of material
nonpublic information by such investment adviser or any person associated with such investment
adviser.

24

150. Brewer Capital, while acting as an investment adviser failed to establish, maintain,
and enforce a written code of ethics that includes at least (a) a standard of business conduct,
reflecting the adviser’s fiduciary obligations, that the adviser requires of its supervised persons, (b)
provisions that require persons with access to certain nonpublic information or persons involved in
making securities recommendations to clients to periodically report personal securities transactions
and holdings, and (c) provisions requiring supervised persons to acknowledge in writing their receipt
of the code of ethics.
151. By reason of the foregoing, Brewer Capital violated Section 204A of the Advisers
Act [15 U.S.C. § 80b-4a] and Rule 204A-1 promulgated under the Advisers Act [17 CFR §
275.204A-1].
152. Defendant, directly or indirectly, aided and abetted Brewer Capital’s primary
violations of Section 204A of the Advisers Act and Rule 204A-1 thereunder because he knowingly
or recklessly provided substantial assistance to Brewer Capital’s violation of Section 204A and Rule
204A-1.
THIRD CLAIM FOR RELIEF
Violations of Section 15(a) of the Exchange Act

153. The Commission re-alleges and incorporates by reference here the allegations in
paragraphs 1, 9, 15 through 28, 36 through 57, and 127 through 144.
154. Defendant, a natural person not associated with a broker or dealer which is a person
other than a natural person, made use of the mails or any means or instrumentality of interstate
commerce to effect transactions in, or to induce or attempt to induce the purchase or sale of, any
security without being registered with the Commission as a broker-dealer.
155. By reason of the foregoing, Defendant violated, and, unless enjoined, will again
violate Exchange Act Section 15(a) [15 U.S.C. § 78o(a)].

25

PRAYER FOR RELIEF
WHEREFORE, the Commission respectfully requests that the Court enter a judgment:
I.
Permanently enjoining Brewer and his agents, servants, employees and attorneys and all
persons in active concert or participation with any of them from violating, directly or indirectly,
Sections 10(b) and 15(a) of the Exchange Act [15 U.S.C. §§ 78j(b) and 78o(a)] and Rule 10b-5 [17
C.F.R. § 240.10b-5] and from aiding and abetting any violation of Section 204A of the Advisers Act
[15 U.S.C. § 80b-4a] and Rule 204A-1 [17 C.F.R. § 275.204A-1];
II.
Ordering Brewer to disgorge all ill-gotten gains he received directly or indirectly, with pre-
judgment interest thereon, as a result of the alleged violations;
III.
Ordering Brewer to pay civil monetary penalties under Exchange Act Section 21A [15 U.S.C.
§78u-1] on the Commission’s first claim for relief; ordering Brewer to pay civil monetary penalties
under Exchange Act Section 21(d)(3) [15 U.S.C. § 78u(d)(3)] on the Commission’s second claim for
relief; and ordering Brewer to pay civil monetary penalties under Advisers Act Section 209(e) [15
U.S.C. § 80b-9] on the Commission’s third claim for relief;
IV.
Permanently prohibiting Brewer from participating in any offering of a penny stock,
including engaging in activities with a broker, dealer, or issuer for purposes of issuing, trading, or
inducing or attempting to induce the purchase or sale of any penny stock, under Exchange Act
Section 21(d)(6) [15 U.S.C. § 78u(d)(6)]; and

26

V.
Granting any other and further relief this Court may deem just and proper.

Dated:     August 6, 2020
               New York, New York
 /s/ Marc P. Berger
MARC P. BERGER
REGIONAL DIRECTOR
Lara S. Mehraban
Preethi Krishnamurthy
Sheldon L. Pollock
Todd Brody
Bennett Ellenbogen
Lindsay S. Moilanen
Attorneys for Plaintiff
 SECURITIES AND EXCHANGE COMMISSION
New York Regional Office
Brookfield Place
200 Vesey Street, Suite 400
New York, New York 10281-1022
(212) 336-0080 (Brody)
[email protected]

MARC P. BERGER 
REGIONAL DIRECTOR 
Lara S. Mehraban 
Preethi Krishnamurthy 
Sheldon L. Pollock 
Todd Brody 
Bennett Ellenbogen 
Lindsay S. Moilanen 
Attorneys for Plaintiff 
SECURITIES AND EXCHANGE COMMISSION 
New York Regional Office 
200 Vesey Street, Suite 400 
New York, New York 10281-1022 
(212) 336-0080 (Brody) 
[email protected]  
 
 
UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF NEW YORK 

 
SECURITIES AND EXCHANGE COMMISSION, 
 
     Plaintiff, 
 

-against- 
 

JACK BREWER, 
  
     Defendant. 

 
COMPLAINT 

 
20 Civ. 6175 (    ) 

  
 

JURY TRIAL DEMANDED 
  
 
 
 

 

 Plaintiff Securities and Exchange Commission (“Commission”), for its Complaint against 

Defendant Jack Brewer (“Brewer”), alleges as follows: 

SUMMARY 

1. In January 2017, Jack Brewer—the owner and principal of both a Commission-

registered investment adviser and a consulting firm, each bearing his last name—engaged in 

unlawful insider trading in the stock of COPsync, Inc. (“COPsync”), among other securities law 

violations.  

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2 
 

2. Brewer provided consulting and endorsement services to COPsync, a microcap 

company that operated a communication network for law enforcement officers. Brewer did so 

pursuant to at least two agreements he signed, which prohibited him from using or disclosing 

confidential information he learned from the company. In return, Brewer and his companies 

received payment in cash and shares of COPsync’s stock. 

3. In approximately December 2016, Brewer, through this consulting and endorsement 

relationship, learned that COPsync was engaged in efforts to sell two million shares of its freely-

trading stock in a private stock offering, likely at a significant discount to the market price. Brewer 

knew that there would likely be a negative impact on COPsync’s stock price once the market learned 

of the private offering. 

4. In late December 2016, Brewer entered into a stock purchase agreement with 

COPsync to buy shares in the offering. Under the agreement’s terms, Brewer agreed that he would 

not buy or sell any shares of the company’s stock before the company issued a press release 

announcing the offering to the public.  

5. On January 4 and 5, 2017, before COPsync issued any such press release, Brewer 

sold 100,000 shares of his pre-existing stock in the company at prices ranging from $1.01 to $1.16 

per share, for proceeds of approximately $104,000. 

6. On the morning of January 6, 2017, the company issued a press release announcing 

that it had issued over 1.77 million shares of stock (including warrants to purchase additional shares) 

in a private offering at an average price of $0.65 per share. At the end of that trading day, the market 

price of the stock closed at $0.69 per share, a 30% decrease from the prior day’s closing price. 

7. By unlawfully selling his shares on January 4 and 5 based on the material, non-public 

information he had obtained, Brewer profited by approximately $35,000 more than he would have 

had he sold his shares shortly after COPsync issued its press release.  

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3 
 

8. In addition, from at least 2015 until November 2017, Brewer aided and abetted his 

investment advisory firm’s failure to design and enforce its written policies and procedures to 

prevent the misuse of non-public information. For example, despite the firm’s written policies 

requiring that the firm maintain a list of restricted stocks about which firm personnel had material, 

non-public information and in which they would therefore not be permitted to trade, Brewer failed 

to ensure that his firm maintained such a list.  

9. From at least April 2015 through July 2017, Brewer also unlawfully acted as a 

securities broker—including by working with microcap companies to provide advice on raising 

capital, introducing the companies to sources of capital, identifying potential investors, and soliciting 

investors for the companies—without being associated with a broker-dealer or being registered as a 

broker with the Commission.  

VIOLATIONS 

10. By engaging in the conduct set forth in this Complaint, Brewer violated Section 10(b) 

of the Securities Exchange Act of 1934 (the “Exchange Act”) [15 U.S.C. § 78j(b)] and Rule 10b-5 

thereunder [17 C.F.R. § 240.10b-5], violated Exchange Act Section 15(a) [15 U.S.C. § 78o(a)], and 

aided and abetted violations of Section 204A of the Investment Advisers Act of 1940 (“Advisers 

Act”) [15 U.S.C. § 80b-4a] and Rule 204A-1 thereunder [17 C.F.R. § 275.204A-1]. 

11. Unless Brewer is permanently restrained and enjoined, he will engage in the acts, 

practices, transactions, and courses of business set forth in this Complaint or in acts, practices, 

transactions, and courses of business of similar type and object. 

NATURE OF THE PROCEEDINGS AND RELIEF SOUGHT 

12. The Commission brings this action pursuant to the authority conferred upon it by 

Exchange Act Sections 21(d) and 21A(a) [15 U.S.C. §§ 78u(d) and 78u-1(a)] and Advisers Act 

Section 209(d) [15 U.S.C. § 80b-9(d)].  

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4 
 

13. The Commission seeks a final judgment (a) permanently enjoining Brewer from 

violating the federal securities laws and rules this Complaint alleges he violated; (b) ordering Brewer 

to disgorge the ill-gotten gains he received with prejudgment interest thereon; (c) ordering Brewer to 

pay civil money penalties pursuant to Exchange Act Sections 21A and 21(d)(3) [15 U.S.C. §§ 78u-1 

and 78u(d)(3)] and Advisers Act Section 209(e) [15 U.S.C. § 80b-9(e)]; (d) prohibiting Brewer from 

participating in any offering of a penny stock, pursuant to Exchange Act Section 21(d)(6) [15 U.S.C. 

§ 78u(d)(6)]; and (e) ordering any other and further relief the Court may deem just and proper. 

JURISDICTION AND VENUE 

14. This Court has jurisdiction over this action pursuant to Exchange Act Section 27 [15 

U.S.C. § 78aa] and Advisers Act Section 214 [15 U.S.C. § 80b-14]. 

15. Brewer, directly and indirectly, has made use of the means or instrumentalities of 

interstate commerce or of the mails in connection with the transactions, acts, practices, and courses 

of business alleged herein. 

16. Venue lies in this District under Exchange Act Section 27 [15 U.S.C. § 78aa] and 

Advisers Act Section 214 [15 U.S.C. § 80b-14]. Brewer transacted business in the Southern District 

of  New York, and certain of  the acts, practices, transactions, and courses of  business alleged in this 

Complaint occurred within this District. For example, Brewer attended COPsync’s Board of 

Directors meeting in Manhattan on December 9, 2016; Brewer’s Manhattan-based broker placed 

Brewer’s relevant trades in COPsync’s stock; and Brewer’s investment advisory firm had its principal 

place of business in New York City.   

THE DEFENDANT 

17. Brewer, age 41, resides in Minnesota and Florida. From at least 2011, Brewer was 

the president, chief executive officer, and portfolio manager of the Brewer Group Inc. (“Brewer 

Group”), a consulting firm. From at least 2010 until November 2017, Brewer was also the principal, 

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5 
 

CEO, and portfolio manager of BSI Wealth Management LLC d/b/a Brewer Capital Management 

(“Brewer Capital”), a Commission-registered investment adviser. Brewer is, or until recently has 

been, the co-host of the digital podcast “Level Headed.” In addition, Brewer has been a regular 

contributor to media networks, programs, and publications, including Yahoo Finance, CNBC, Fox 

Business, CNN, and the American City Business Journals.  

OTHER RELEVANT ENTITIES 

18. Brewer Group is a Minnesota corporation and consulting firm with a portfolio 

covering financial services, healthcare, agriculture, sports, media and entertainment. At all relevant 

times, Brewer was the Brewer Group’s president, chief executive officer, and portfolio manager. 

Brewer owns 100% of the Brewer Group. 

19. Brewer & Associates Consulting LLC (“Brewer Consulting”) was at all relevant 

times a wholly-owned subsidiary of the Brewer Group and has described itself as an “advisory firm 

focused on providing tailored business development, marketing and event management services and 

support for small-cap and middle market companies.” At all relevant times, Brewer was Brewer 

Consulting’s CEO. 

20. Brewer Capital was at all relevant times a Delaware limited liability company with 

its principal place of business in New York, New York. Brewer Capital was founded in 2009. From 

2010 through November 2017, Brewer Capital was registered with the Commission as an investment 

adviser. According to its Form ADV dated October 30, 2017, filed with the Commission, Brewer 

Capital’s managing member was Brewer Sports International, LLC, which Brewer managed and 80% 

of which the Brewer Group owned. At all relevant times, Brewer was Brewer Capital’s CEO and 

portfolio manager.  

21. COPsync was a Delaware corporation with its principal place of business in New 

Orleans, Louisiana for portions of the relevant period. At all relevant times, COPsync purported to 

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6 
 

operate the COPsync Network, a communication network for law enforcement officers. From at 

least December 31, 2008 until July 23, 2018, COPsync’s common stock was registered under 

Exchange Action Section 12(g). From July 1, 2008 to November 2015, COPsync’s common stock 

was quoted on the OTCQB, an interdealer quotation service. From November 2015 through at least 

January 2017, COPsync’s shares were listed on the NASDAQ Capital Market under the ticker 

symbol “COYN.” On September 29, 2017, COPsync filed a Chapter 11 petition in the U.S. 

Bankruptcy Court for the Eastern District of Louisiana. On July 23, 2018, the Commission revoked 

the registration of COPsync’s common stock pursuant to Exchange Act Section 12(j). At all relevant 

times, COPsync’s common stock met the definition of a “penny stock” under Exchange Act Section 

3(a)(51) [15 U.S.C. § 78c(a)(51)] and Rule 3a-51-1 thereunder [17 C.F.R. § 240.3a51-1], because the 

stock traded below five dollars per share and did not satisfy any of the exceptions to the definition 

of “penny stock” set forth in Rule 3a-51-1. 

FACTS 

I. BACKGROUND 

22. From approximately 2002 to 2006, Brewer played football in the National Football 

League.  

23. Upon his retirement from professional football, Brewer transitioned his career to the 

financial services industry.  

24. In approximately 2006, Brewer founded the Brewer Group. 

25. In approximately 2007, Brewer became a registered representative of a large, 

Commission-registered broker-dealer firm in its Private Client Group.  

26. From approximately 2009 until 2011, Brewer served as a managing director of a 

Commission-registered, private, biotech-focused investment bank.  

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7 
 

27. From approximately 2011 through 2015, Brewer worked as an associated person for 

at least three different firms in the financial services industry, other than his affiliated entities. 

28. At various times from 2007 through 2016, Brewer held Series 7, Series 66, and Series 

79 securities licenses, which permitted him to undertake certain securities-related activities. 

29. In approximately 2009, Brewer founded Brewer Capital. 

30. From approximately 2010 through November 2017, while registered with the 

Commission as an investment adviser, Brewer Capital provided investment advisory services to a 

handful of high net-worth individuals, primarily professional athletes and former professional 

athletes.   

31. As of January 1, 2016, Brewer Capital had approximately $27 million in assets under 

management. 

II. BREWER CAPITAL’S WRITTEN SUPERVISORY PROCEDURES DESCRIBED 
PROHIBITIONS ON INSIDER TRADING. 
 
32. In both 2015 and 2016, Brewer Capital had written supervisory procedures.  

33. Among other things, the written supervisory procedures for both years—which all 

Brewer Capital personnel were required to read, acknowledge in writing, and follow—stated: 

The legal prohibitions against ‘insider trading’ and [Brewer Capital]’s 
professional responsibility forbid the use or disclosure by all 
directors, officers and Access Persons of [Brewer Capital], for direct 
or indirect personal gain or profit of ‘insider information’ received in 
connection with the business of [Brewer Capital] or from any source. 
Moreover, the use of material, non-public information in securities 
transactions (‘insider trading’) or the communication of such inside 
information to others (‘tipping’) may violate federal and/or state 
securities laws. Such a violation of law could result in severe personal 
consequences to the individuals involved…. 
  

34. The written supervisory procedures for both years further stated: 

All persons associated with [Brewer Capital] are prohibited from 
engaging in any securities transaction for their own benefit or the 
benefit of others, while in possession of: (a) Material, non-public 
information concerning such securities which is known to the any 

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8 
 

person by virtue of his or her position as an insider with respect to 
the issuer of such securities….  

 
35. The same written supervisory procedures explained that “a person can be a 

‘temporary insider’ if he or she enters into a special confidential relationship in the conduct of a 

company’s affairs and as a result is given access to information solely for the company’s purposes” 

and that “consultants” and “advisers” can be temporary insiders. 

III. BREWER PROVIDED CONSULTING AND OTHER SERVICES TO COPSYNC. 

36. On approximately August 12, 2015, Brewer Consulting, the Brewer Group’s wholly-

owned subsidiary, entered into a consulting agreement with COPsync, effective as of that date.  

37. Brewer signed the agreement on Brewer Consulting’s behalf as its CEO.  

38. The agreement described COPsync as a “publically held company… (OTCQB: 

COYN).” 

39. Under the agreement’s terms, Brewer Consulting agreed to provide “global business 

development and marketing” consulting services to COPsync at its request, including by 

“participat[ing] in [COPsync] conference calls and meetings as requested.”  

40. In exchange for its services, Brewer Consulting stood to receive $4,500 per month 

from COPsync (to be accrued and payable only after COPsync’s shares of common stock were 

“uplist[ed]” on the NASDAQ exchange) plus one million shares of COPsync’s common stock.  

41. The agreement lasted until the earlier of twelve months from the effective date or 

the termination by either party with thirty days’ written notice to the other party.  

42. The agreement contained a confidentiality provision that lasted for at least three 

years: 

[Brewer Consulting] will maintain in confidence all proprietary, non-
published information obtained by [Brewer Consulting] with respect 
to [COPsync] during the course of the performance of [Brewer 
Consulting]’s services hereunder, and [Brewer Consulting] shall not 
use any of the same for its own benefit or disclose any of the same to 

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9 
 

any third party, without [COPsync’s] prior written consent, both 
during and within three (3) years after the term of this Agreement. 
For the purposes of this Agreement, “Confidential Information” 
means information about the Company’s business activities that is 
proprietary and confidential, which shall include all business, 
financial, technical and other information of [COPsync]….   

43. On approximately December 1, 2015, Brewer Consulting and COPsync expanded 

the consulting agreement by entering into an “Expansion Advisory Agreement,” effective as of that 

date.  

44. Brewer signed the expansion agreement on Brewer Consulting’s behalf as its CEO.  

45. Under the agreement’s terms, Brewer Consulting agreed to provide additional 

services at COPsync’s request, including “[a]ssisting in managing ongoing marketing efforts which 

include working with [COPsync]’s investor relations strategic partners in an effort to increase market 

awareness for [COPsync]’s publicly traded securities.”  

46. In return, COPsync agreed to make monthly payments of $4,000 to Brewer 

Consulting and to issue an additional 20,000 shares of COPsync’s common stock directly to the 

Brewer Group in two equal installments.  

47. The expansion agreement extended the original consulting agreement until the earlier 

of twelve months from the expansion agreement’s effective date—that is, November 30, 2016—or 

termination in writing by either party.  

48. The expansion agreement ratified all other provisions in the original agreement, 

including the three-year confidentiality provision. 

49. On approximately January 1, 2016, Brewer personally entered into an endorsement 

agreement with COPsync, effective as of that date.  

50. Brewer signed the agreement on his own behalf, noting underneath his title of CEO 

of the Brewer Group.  

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51. The endorsement agreement provided that Brewer would “[e]ndorse and serve as a 

public figure for the Company” and would “work with [COPsync] to assist with enhancing 

[COPsync] brand recognition of the COPsync technology, services and product line”—including by 

“[a]ttend[ing] and participat[ing] in key, high-level [COPsync] meetings and calls upon occasion.”  

52. In return, the endorsement agreement required COPsync to pay Brewer $1,500,000 

either in four equal, quarterly installments or partly or wholly through certain “commission 

payments” Brewer stood to receive under the agreement.  

53. As further payment, the endorsement agreement required COPsync to issue 200,000 

shares of COPsync’s restricted common stock—in essence, stock that Brewer had to hold for a 

certain period of time before he could sell the stock into the public market, unlike freely-trading 

shares that could be sold upon receipt—to Brewer in two equal installments over six months. 

54. The endorsement agreement also contained a confidentiality clause that included the 

following terms:  

[Brewer] acknowledges and understands that in [his] capacity as [an 
e]ndorser, [he] will have access to [COPsync]’s and [COPsync]’s [sic] 
confidential and proprietary information (the ‘Confidential 
Information’). [Brewer] agrees to hold in trust and confidence all 
Confidential Information disclosed to [him] and further agrees not to 
exploit or disclose the Confidential Information directly or indirectly 
for any purpose other than for [Brewer]’s work with [COPsync].  

55. The endorsement agreement had a term of 18 months from the effective date—that 

is, it lasted until June 30, 2017—absent an earlier written termination by either party in writing.    

56. COPsync issued the first 100,000 shares of its restricted stock to Brewer pursuant to 

the endorsement agreement on approximately February 12, 2016.  

57. Brewer exchanged these 100,000 restricted shares for freely-trading COPsync shares 

on approximately November 30, 2016. 

  

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IV. BREWER PARTICIPATED IN COPSYNC’S CONFIDENTIAL PLANS TO 
RAISE CAPITAL THROUGH A PRIVATE STOCK OFFERING.  

58. On July 1, 2016, COPsync filed a “shelf” registration statement with the 

Commission on Form S-3 in connection with COPsync’s potential issuance of up to $25 million of 

its securities1  

59. This “shelf” registration statement covered COPsync’s potential securities 

offerings—including “common stock, preferred stock, warrants and rights, or any combination”—

“from time to time in indeterminate amounts and at indeterminate times.”2  

60. The registration statement made clear that COPsync “may distribute” the securities 

“in one or more transactions” through various unspecified pricing mechanisms: “a fixed price or 

prices, which may be changed,” “market prices prevailing at the time of sale,” “prices related to such 

prevailing market prices,” or “negotiated prices.” 

61. The registration statement further noted that the “estimated expenses” in connection 

with any issuance and distribution of securities described in the statement were “not presently 

known because they depend upon, among other things, the number of offerings that will be made 

pursuant to this registration statement, the amount and type of securities being offered and the 

timing of such offerings.”  

62. On July 13, 2016, the Commission declared COPsync’s “shelf” registration statement 

effective.  

                                                 
1  A “shelf” registration statement allows an issuer in certain circumstances to offer securities 
to the public without a separate prospectus for each offering but instead with a single prospectus for 
multiple, indeterminate future offerings.  

2  A warrant gives the holder the right to buy or sell a security, such as stock, at a certain price 
before the warrant’s expiration.  

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63. On August 19, 2016, COPsync’s Board of Directors (the “Board”) held an in-person 

meeting at the company’s office in Addison, Texas. 

64. Brewer attended the entire meeting at the Board’s invitation.  

65. At the meeting, the Board made no firm decisions about how to finance COPsync 

but discussed a potential sequence of funding events, including a bridge loan in August 2016 and an 

equity raise—that is, issuing stock to obtain capital—in September 2016. 

66. The Board also discussed the creation of a special financing committee to explore 

COPsync’s financing options and invited Brewer to participate as an advisor to the committee.  

67. On November 14, 2016, COPsync filed its quarterly report on Form 10-Q for the 

quarter ending September 30, 2016.  

68. The Form 10-Q mentioned the Form S-3 registration statement but, like the Form S-

3, did not specify any planned offering of stock, other than that stock “may be issued by [COPsync] 

from time to time in indeterminate amounts and at indeterminate times.” 

69. On December 6, 2016, a firm that had performed investment banking functions for 

COPsync (the “Investment Bank”) entered into an agreement—marked “confidential”—with 

COPsync to serve as its placement agent for a potential offering of two million shares of the 

company’s stock.  

70. On December 8, 2016, COPsync’s common stock price closed at $0.89 per share. 

71. On December 9, 2016, COPsync’s Board held a meeting in New York, New York, in 

which some participants participated by phone and others appeared in person.  

72. Brewer attended the Board meeting in person.  

73. At the meeting, the Board decided that COPsync would offer up to two million 

freely-trading shares of its common stock, with each share sold as a “unit” with two warrants. Each 

warrant would entitle the holder to purchase an additional share of common stock.   

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74. The Board proposed that the purchase price for each of these “units” would be the 

lesser of (a) the ten-day volume weighted average price of the common stock, measured as of the 

close of the market on the offering date, or (b) $0.90. The Board further proposed that the first of 

the two warrants in each “unit” would be exercisable for cash within six months at a price of $1.10 

per share of common stock, and that the second warrant in each “unit” would be exercisable in cash 

or in a cashless exercise transaction within five years at a price of $1.25 per share of common stock.  

75. At the same meeting, the Board established a special pricing committee, consisting 

solely of COPsync’s then-chief executive officer, to determine the final terms and conditions of the 

offering, including the pricing of the securities offering within specified parameters. Among other 

things, the Board resolved that the “units” could be sold at up to a 30% discount to the market price 

of COPsync’s common stock without any further Board action or ratification.  

76. This information was confidential and non-public. 

77. On the afternoon of December 12, 2016, COPsync’s CEO emailed Brewer 

documents relating to the proposed offering, including an investor presentation and a “Summary of 

Proposed Offering Terms for COPSync, Inc.” 

78. The investor presentation, which itself contained a brief summary of the offering, 

bore the following legend in capital letters on the bottom of each page: “Strictly confidential. Not 

for distribution to the public.” 

79. The second page of the investor presentation further stated: “This presentation is 

strictly confidential and may not be distributed to any other person, and may not be reproduced or 

published, in whole or in part, in any form. Failure to comply with this restriction may constitute a 

violation of applicable securities laws.” 

80. The separate summary of the proposed offering terms made clear, among other 

things, that COPsync proposed to offer up to two million freely-trading shares of its common stock 

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in units comprised of one share of stock and two warrants and that the proposed purchase price for 

each of these “units” would be the lesser of the ten-day volume weighted average price of the 

common stock, measured as of the close of the market on the offering date, or $0.90.  

81. That afternoon, Brewer forwarded the email and attachments to the co-manager of 

an emerging growth fund (the “Fund Manager”) with whom Brewer had done business before and 

copied two Brewer Group colleagues. Brewer wrote: “Let’s discuss again if you can.”  

82. Within an hour, one of Brewer’s colleagues replied to Brewer’s email and pointed 

out, among other things, that any purchasers in the offering would promptly sell their shares after 

receiving them once the transaction closed:  

Terms will end up being expensive money – this will be a death spiral 
if he [COPsync’s CEO] can even raise the capital. For it not to be – it 
would have to be raised from complete new-to-the-game retail 
investors… Warrants will act as the asset and call option to upside 
for investors, as the common gets flushed into market on close of 
transactions. 

83. On December 21, 2016, Brewer emailed COPsync’s corporate counsel and asked 

her: “Any eta on the terms of the equity financing? Is that still happening this week?”   

84. Later the same day, Brewer received another email from the Fund Manager, who 

noted “the discounted purchase or any downside movement on the stock”—meaning the offering’s 

discounted share price and COPsync’s expected stock price decline after the company announced 

the offering and the investors in the offering sold their shares.   

85. In an email that evening, Brewer made clear to the Fund Manager that the Brewer 

Group planned to invest in the COPsync offering. 

86. On December 21, 2016, Brewer received by email a copy of the securities purchase 

agreement (the “Purchase Agreement”) to participate in COPsync’s offering.   

87. The Purchase Agreement contained a clause entitled “Certain Transactions and 

Confidentiality,” by which each purchaser in the offering agreed:  

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[N]either it nor any [a]ffiliate acting on its behalf or pursuant to any understanding 
with it will execute any purchases or sales, including [s]hort [s]ales of any of 
[COPsync’s] securities during the period commencing with the execution of this 
Agreement and ending at such time that the transactions contemplated by this 
Agreement are first publicly announced pursuant to the initial press release 
[described above]. Each [p]urchaser… covenants that until such time as the 
transactions contemplated by this Agreement are publicly disclosed by [COPsync] 
pursuant to the initial press release [described above], such [p]urchaser will maintain 
the confidentiality of the existence and terms of this transaction….  

88. On December 28, 2016, the Brewer Group’s chief operating officer emailed Brewer’s 

signed signature page on the Purchase Agreement, which Brewer had signed on the Brewer Group’s 

behalf, to COPsync and copied Brewer on the email.  

V. BREWER SOLD SHARES OF COPSYNC TO MAXIMIZE HIS 
PROFIT BEFORE COPSYNC ANNOUNCED THE OFFERING.  

89. On or about January 4, 2017, Brewer directly or indirectly instructed his Manhattan-

based broker to sell shares of COPsync from Brewer’s personal brokerage account. 

90. On January 4, 2017, Brewer’s broker executed Brewer’s sale of 5,000 shares of 

COPsync at a price of approximately $1.01 per share, for total proceeds of $5,063.88.  

91. That evening, Brewer received an email from his broker informing him that the sale 

of the COPsync shares had been executed and that the broker would sell more shares the next day. 

92. On January 5, 2017, Brewer’s broker sold an additional 95,000 shares of COPsync 

from Brewer’s brokerage account at prices ranging from approximately $1.01 to $1.16 per share, for 

total proceeds of $99,114.29.   

93. Before selling his stock, Brewer did not seek COPsync’s consent to do so or disclose 

to COPsync that he intended to do so. 

94. On January 5, 2017, COPsync’s shares of common stock closed at a price of $1.03 

per share.  

95. On the morning of January 6, 2017, COPsync issued a press release announcing the 

offering and disclosing that it had sold 1,772,614 shares of common stock, as well as warrants to 

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purchase additional shares. The press release stated that the price to purchase one common stock 

share, one Class A warrant, and one Class B warrant combined was $0.65. 

96. Over the course of the day, the volume of trading in COPsync’s stock more than 

tripled from the previous day, and the stock price closed that day at $0.69 per share—approximately 

a 30% drop from the prior day’s closing price. 

97. By selling 100,000 shares on January 4 and 5, rather than waiting until after COPsync 

announced the offering on January 6, Brewer profited by approximately $35,000 more than he 

otherwise would have.  

98. The Brewer Group never obtained any COPsync stock pursuant to the Purchase 

Agreement. Shortly after the offering closed, the Brewer Group assigned its rights to purchase 

COPsync stock under the Purchase Agreement to a third party. 

99. Later in January 2017, the Financial Industry Regulatory Authority, a self-regulatory 

organization, began a review of trading in COPsync shares around the time of the offering.  

100. As part of this review, COPsync reached out to certain individuals who had been 

privy to information about events leading up to the offering announcement, including Brewer.  

101. Brewer refused to respond to COPsync’s inquiry. 

VI. BREWER AIDED AND ABETTED BREWER CAPITAL’S FAILURE TO 
REASONABLY ESTABLISH AND ENFORCE WRITTEN POLICIES 
CONCERNING THE MISUSE OF MATERIAL, NONPUBLIC INFORMATION.  

 
A. Background: Advisers Act Section 204A and Rule 204A-1 Thereunder  

 
102. Advisers Act Section 204A and Rule 204A-1 together serve to ensure that 

investment advisers establish, maintain, and enforce written policies to prevent advisory firms, their 

control persons, and their employees from misusing material, nonpublic information.  

103. Advisers Act Section 204A requires investment advisers to establish, maintain, and 

enforce written policies and procedures reasonably designed, taking into consideration the nature of 

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the investment adviser’s business, to prevent the misuse of material, nonpublic information by the 

investment adviser or any person associated with the investment adviser, including any person who 

directly or indirectly controls the investment adviser.  

104. Rule 204A-1 requires investment advisers to “establish, maintain and enforce a 

written code of ethics.”  

105. The required code of ethics must include at least (a) a standard of business conduct, 

reflecting the adviser’s fiduciary obligations, that the adviser requires of its supervised persons, (b) 

provisions that require persons with access to certain nonpublic information or persons involved in 

making securities recommendations to clients to periodically report personal securities transactions 

and holdings, and (c) provisions requiring supervised persons to acknowledge in writing their receipt 

of the code of ethics. 

B. Brewer Capital Failed to Reasonably Design and Enforce Its Code of Ethics 
and Written Supervisory Procedures, and Brewer Aided and Abetted Brewer 
Capital’s Failure.  

106. From at least 2015 through November 2017, Brewer, as Brewer Capital’s manager 

and majority owner (through his ownership of the Brewer Group), made Brewer Capital’s trading 

decisions. 

107. During the same period, Brewer and others who worked at Brewer Capital also 

performed work for one or more of Brewer Capital’s affiliated firms under the Brewer Group 

umbrella, including Brewer Consulting.  

108. During the same period, Brewer and other Brewer Capital employees repeatedly 

obtained material, non-public information about securities based on their work on behalf of 

securities issuers for Brewer Capital’s affiliated firms, including Brewer Consulting. 

109. For example, Brewer and others at Brewer Capital obtained material non-public 

information about COPsync pursuant to the consulting agreement between Brewer Consulting and 

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COPsync described above in paragraphs 36 through 48 and pursuant to the endorsement agreement 

between Brewer and COPsync described above in paragraphs 49 through 55. 

110. During the same period, Brewer Capital had written supervisory procedures whose 

purpose was to “provide personnel with an awareness of the requirements of the law, rules and 

regulations governing investment adviser and investment-Advisory representative activities; and … 

provide procedural means necessary to ensure that the operations of the Firm meet those 

requirements,” including the descriptions of insider trading prohibitions described above in 

paragraphs 32 through 35.  

111. The written supervisory procedures for at least 2015 and 2016 provided that Brewer 

Capital’s “access persons”—which included employees, directors, officers, partners and members of 

Brewer Capital who had access to non-public information regarding advisory clients’ purchases or 

sales of securities or who made securities recommendations to clients—were required, when they 

had any question as to whether information in their possession was material or non-public, to 

“[r]eport the matter immediately to the CCO [chief compliance officer]” and “[r]efrain from the 

purchase or sale of [the] securities on behalf of themselves or others.”  

112. The same supervisory procedures also provided that a Brewer Capital access person 

“may not buy or sell any security in which the person had a beneficial ownership unless the 

transaction occurred in an exempted security or the employee has complied with the Personal 

Security Transaction Policy.” That policy in turn required the access person to complete Brewer 

Capital’s pre-clearance form and submit that form to the chief compliance officer (“CCO”) for 

review before making any such securities transaction. 

113. These supervisory procedures further provided that Brewer Capital access persons 

were required to have written pre-clearance for personal securities transactions when the securities 

were (1) on the restricted security list—that is, a list of securities that a firm prohibits its employees 

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from buying or selling, typically because of access to material, non-public information about the 

securities; (2) on the security watch list—a list of securities that a company selects for special 

surveillance as to potential transactions by employees; (3) offered in an initial public offering; (4) 

offered in a private placement—a sale of securities to pre-selected investors, rather than to the 

public; or (5) offered in a limited offering—an offering exempt from registration under the 

Securities Act of 1933. In each of those instances, the supervisory procedures required access 

persons to complete Brewer Capital’s pre-clearance form. 

114. From at least 2015 through November 2017, Brewer Capital’s written supervisory 

procedures included a Code of Ethics.  

115. The Code of Ethics provided that access persons “may be subject to a blackout 

period from trading” in thinly traded securities, defined as securities with average daily trading 

volume below 100,000 shares. 

116. The Code of Ethics further made clear: “[Brewer Capital] and its employees generally 

may not participate in private placements or initial public offerings (IPOs) without pre-clearance 

from [Brewer Capital]’s Compliance Officer.”   

117. In 2016, Brewer held joint responsibility, together with Brewer Capital’s CCO, for 

reading and updating Brewer Capital’s supervisory procedures and Code of Ethics.  

118. In 2016, Brewer and the CCO likewise held joint responsibility for conducting the 

annual employee compliance training. 

119. From at least 2015 through November 2017, Brewer Capital did not enforce the 

procedures in the written supervisory procedures and Code of Ethics described above in paragraphs 

32 through 35 and 111 through116. 

120. For example, during at least that period, Brewer Capital did not keep a restricted list 

or watch list to track stocks for which the firm had obtained material, non-public information.  

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121. During at least the same period, Brewer Capital did not impose blackout periods for 

trading thinly traded securities. 

122. Before July 2017, Brewer Capital did not enforce its pre-clearance policies for 

trading. 

123. From at least 2015 through at least July 2017, Brewer never submitted any Personal 

Trading Pre-Clearance forms and from at least 2015 through November 2017, Brewer never 

consulted any restricted list or watch list before engaging in securities transactions, because no such 

lists existed.  

124. From 2015 through November 2017, Brewer (on Brewer Consulting’s behalf) 

negotiated and entered into consulting agreements with at least nine issuers, pursuant to which 

Brewer Consulting performed services and received or had the potential of receiving material non-

public information.   

125. From at least 2015 through November 2017, Brewer negotiated and entered into 

personal endorsement agreements with three of those same issuers. 

126. Brewer Capital’s 2015 and 2016 written supervisory procedures and Code of Ethics 

failed to establish procedures reasonably designed to prevent Brewer and other Brewer Capital 

employees from misusing material, non-public information they obtained as a result of their 

responsibilities at Brewer Capital’s affiliated entities. 

VII. BREWER ACTED AS AN UNREGISTERED BROKER.  

127. From April 2015 through July 2017, Brewer was not associated with any broker-

dealer or registered with the Commission as a broker-dealer. 

128. During this period, Brewer worked with microcap companies to provide advice on 

raising capital, to introduce the companies to sources of capital, and to identify potential investors. 

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129. For example, on June 26, 2015, Brewer Consulting entered into an agreement with a 

microcap company, Issuer A, to provide global business development and marketing consulting 

services, including to “work on the Company’s behalf with investment banking firms and potential 

investors….”   

130. This agreement was extended several times. 

131. For this and other services, Issuer A agreed to pay Brewer Consulting an advisory fee 

of $2,000 per month and to issue 500,000 shares of restricted common stock to the Brewer Group 

each quarter. 

132. As reported in Issuer A’s annual report on Form 10-K for the year ended December 

31, 2016, “the Brewer Group … arranged a number of meetings with various hedge funds in New 

York to assist with the funding of the company.” 

133. Similarly, Brewer Consulting entered into an agreement, effective February 10, 2017, 

with another microcap company, Issuer B, to represent the company by “providing ongoing support 

including, but not limited to, facilitating introductory meetings with financial firms and institutional 

investors.” 

134. For this and other services, Issuer B agreed to issue 800,000 shares of restricted 

common stock and 800,000 warrants spread out over quarterly payments to the Brewer Group. 

135. Issuer B’s Chairman of the Board of Directors repeatedly asked Brewer to introduce 

him to potential investors.  

136. Brewer repeatedly solicited investments in Issuer B.  

137. Similarly, as a consultant to COPsync, Brewer identified and communicated with 

potential purchasers of COPsync’s securities, solicited securities transactions, and had his advisory 

clients purchase COPsync securities. 

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138. For these and other services, Brewer received cash and COPsync shares from 

COPsync. 

139. In August 2016, COPsync’s CEO requested that the Brewer Group provide a bullet 

point list of the top accomplishments that the Brewer Group had achieved for COPsync because the 

CEO was expecting a “rigorous review” of the relationship from COPsync’s Board and wanted help 

articulating “the value created versus the expense incurred.” 

140. The Brewer Group’s response stated that Brewer Consulting was “instrumental in 

COPsync’s NASDAQ uplisting and ongoing capital markets support.”   

141. The response further explained that Brewer Consulting “provides ongoing capital 

markets support including facilitating introductions to various investment bankers including [the 

Investment Bank] surrounding COPsync’s uplisting transaction as well as to several private 

investors, research analysts, etc. leading up to, during and following the Company’s successful uplist 

to the NASDAQ stock exchange market.”  

142. In a follow-up email reviewed by Brewer, the Brewer Group added:  

Given his background, vast network, and extremely established 
relationships in the space including with public and private investors 
and high-net-worth individuals, Jack Brewer was instrumental in 
helping COPSync with the NASDAQ uplisting process and provides 
ongoing capital markets support including facilitating introduction to 
various investment bankers … surrounding COPSync’s uplisting 
transaction as well as to several private investors, research analysts, 
etc. leading up to, during and following the Company’s successful 
uplist to the NASDAQ stock exchange market. 

143. The email also included a breakdown of the nearly $2.8 million of investments in 

COPsync securities made as a result of Brewer’s introductions.  

144. This amount included investments made by four Brewer Capital clients as well as 

“over $500,000 in open market support from various investors.” 

  

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FIRST CLAIM FOR RELIEF 
Violations of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder 

 
145. The Commission re-alleges and incorporates by reference here the allegations in 

paragraphs 1 through 8, 15 through 101, and 106 through 126. 

146. Defendant, directly or indirectly, in connection with the purchase or sale of securities 

and by the use of means or instrumentalities of interstate commerce, or the mails, or the facilities of 

a national securities exchange, knowingly or recklessly has (i) employed one or more devices, 

schemes, or artifices to defraud, (ii) made one or more untrue statements of a material fact or 

omitted to state one or more material facts necessary in order to make the statements made, in light 

of the circumstances under which they were made, not misleading, and/or (iii) engaged in one or 

more acts, practices, or courses of business which operated or would operate as a fraud or deceit 

upon other persons. 

147. By reason of the foregoing, Defendant, directly or indirectly, has violated and, unless 

enjoined, will again violate Exchange Act Section 10(b) [15 U.S.C. § 78j(b)] and Rule 10b-5 

thereunder [17 C.F.R. § 240.10b-5]. 

SECOND CLAIM FOR RELIEF 
Aiding and Abetting Violations of Section 204A of the Advisers Act  

and Rule 204A-1 Thereunder 
 

148. The Commission re-alleges and incorporates by reference here the allegations in 

paragraphs 1 through 8, 15 through 126, and 128 through 138. 

149. Brewer Capital, while acting as an investment adviser, failed to establish, maintain, 

and enforce written policies and procedures reasonably designed, taking into consideration the 

nature of its business, to prevent the misuse in violation of the Advisers Act [15 U.S.C. § 80b-1 et 

seq.] or the Exchange Act [15 U.S.C. § 78a et seq.], or the rules or regulations thereunder, of material 

nonpublic information by such investment adviser or any person associated with such investment 

adviser. 

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150. Brewer Capital, while acting as an investment adviser failed to establish, maintain, 

and enforce a written code of ethics that includes at least (a) a standard of business conduct, 

reflecting the adviser’s fiduciary obligations, that the adviser requires of its supervised persons, (b) 

provisions that require persons with access to certain nonpublic information or persons involved in 

making securities recommendations to clients to periodically report personal securities transactions 

and holdings, and (c) provisions requiring supervised persons to acknowledge in writing their receipt 

of the code of ethics. 

151. By reason of the foregoing, Brewer Capital violated Section 204A of the Advisers 

Act [15 U.S.C. § 80b-4a] and Rule 204A-1 promulgated under the Advisers Act [17 CFR § 

275.204A-1]. 

152. Defendant, directly or indirectly, aided and abetted Brewer Capital’s primary 

violations of Section 204A of the Advisers Act and Rule 204A-1 thereunder because he knowingly 

or recklessly provided substantial assistance to Brewer Capital’s violation of Section 204A and Rule 

204A-1. 

THIRD CLAIM FOR RELIEF 
Violations of Section 15(a) of the Exchange Act 

 
153. The Commission re-alleges and incorporates by reference here the allegations in 

paragraphs 1, 9, 15 through 28, 36 through 57, and 127 through 144. 

154. Defendant, a natural person not associated with a broker or dealer which is a person 

other than a natural person, made use of the mails or any means or instrumentality of interstate 

commerce to effect transactions in, or to induce or attempt to induce the purchase or sale of, any 

security without being registered with the Commission as a broker-dealer.  

155. By reason of the foregoing, Defendant violated, and, unless enjoined, will again 

violate Exchange Act Section 15(a) [15 U.S.C. § 78o(a)]. 

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PRAYER FOR RELIEF 

WHEREFORE, the Commission respectfully requests that the Court enter a judgment:   

I.  

Permanently enjoining Brewer and his agents, servants, employees and attorneys and all 

persons in active concert or participation with any of them from violating, directly or indirectly, 

Sections 10(b) and 15(a) of the Exchange Act [15 U.S.C. §§ 78j(b) and 78o(a)] and Rule 10b-5 [17 

C.F.R. § 240.10b-5] and from aiding and abetting any violation of Section 204A of the Advisers Act 

[15 U.S.C. § 80b-4a] and Rule 204A-1 [17 C.F.R. § 275.204A-1]; 

II. 

Ordering Brewer to disgorge all ill-gotten gains he received directly or indirectly, with pre-

judgment interest thereon, as a result of the alleged violations; 

III. 

Ordering Brewer to pay civil monetary penalties under Exchange Act Section 21A [15 U.S.C. 

§78u-1] on the Commission’s first claim for relief; ordering Brewer to pay civil monetary penalties 

under Exchange Act Section 21(d)(3) [15 U.S.C. § 78u(d)(3)] on the Commission’s second claim for 

relief; and ordering Brewer to pay civil monetary penalties under Advisers Act Section 209(e) [15 

U.S.C. § 80b-9] on the Commission’s third claim for relief; 

IV. 

Permanently prohibiting Brewer from participating in any offering of a penny stock, 

including engaging in activities with a broker, dealer, or issuer for purposes of issuing, trading, or 

inducing or attempting to induce the purchase or sale of any penny stock, under Exchange Act 

Section 21(d)(6) [15 U.S.C. § 78u(d)(6)]; and 

  

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V. 

Granting any other and further relief this Court may deem just and proper. 

 
Dated:     August 6, 2020  
               New York, New York  

 /s/ Marc P. Berger   
MARC P. BERGER 
REGIONAL DIRECTOR 
Lara S. Mehraban 
Preethi Krishnamurthy 
Sheldon L. Pollock 
Todd Brody 
Bennett Ellenbogen 
Lindsay S. Moilanen  
Attorneys for Plaintiff           

 SECURITIES AND EXCHANGE COMMISSION 
New York Regional Office 
Brookfield Place  
200 Vesey Street, Suite 400 
New York, New York 10281-1022  
(212) 336-0080 (Brody) 
[email protected] 

 
 

Case 1:20-cv-06175   Document 1   Filed 08/06/20   Page 26 of 26