SEC v. Phillip Frost; OPKO Health, Inc.; Frost Gamma Investments Trust; Mark Groussman; Melechdavid Inc.; and Alpha Capital Anstalt, No. LR-24431, Southern District of New York (Mar. 22, 2019) — Press Release
raw: Barry Honig, et al.
Barry Honig, et al., No. LR-24431 (S.D.N.Y. Mar. 22, 2019)
summary
Phillip Frost, OPKO Health, and others settled with the SEC for over $7.8 million in a microcap stock manipulation scheme that generated over $27 million in illicit gains.
paragraph
The SEC settled with six defendants, including billionaire investor Phillip Frost and publicly traded company OPKO Health, Inc., in a market manipulation case involving microcap schemes that generated over $27 million in unlawful stock sales. The settling defendants paid over $7.8 million in disgorgement, prejudgment interest, and civil penalties, and consented to permanent injunctions and penny stock bars. Thirteen remaining defendants are still facing charges.
narrative
The Securities and Exchange Commission (SEC) has settled with six defendants, including billionaire investor Phillip Frost and publicly traded company OPKO Health, Inc., in a market manipulation case involving microcap schemes that generated over $27 million in unlawful stock sales. The settling defendants, who also include Mark Groussman and associated entities, paid over $7.8 million in disgorgement, prejudgment interest, and civil penalties, and consented to permanent injunctions and penny stock bars. The original complaint alleged that the defendants failed to disclose their membership in an investor group, misleading investors and violating federal securities laws. The SEC amended its complaint against 13 remaining defendants, adding further allegations of undisclosed coordinated trading and violations of securities registration and disclosure rules. Southern Biotech, Inc., a now-defunct entity, had its charges dismissed. The defendants settled without admitting or denying guilt, but agreed to cease future violations of federal securities laws. The case centers on a coordinated effort to manipulate penny stocks by concealing group membership and improperly selling unregistered securities.
Classified market-manipulation(confidence 100%). EDGAR detection: forms SC 13D/G/13F· recall 53% / precision 9%. detection rule →
Parties
Securities and Exchange CommissionPhillip FrostOPKO Health, Inc.Frost Gamma Investments TrustMark GroussmanMelechdavid Inc.Alpha Capital Anstalt
Keywords
secfrostbarry honigobtained finalsecuritiesseptemberfinalmarch securitiessecurities exchangeexchange commissioncivil actionfinal consentfinal judgmentscompany whichfrost gamma
Exhibits & Attached Documents (1)
Extracted insights
Dollar amounts 2
- $27.00M $27 million $10M–$100M
- $7.80M $7.8 million $1M–$10M
Entities 9
- scheme_term a civil action for microcap market manipulation
- person amended complaint
- person barry honig
- person Defendant
- person microcap schemes
- scheme_term multiple defendants in a market manipulation case
- agency Securities and Exchange Commission
- organization Securities and Exchange Commission
- scheme_term with multiple defendants in market manipulation case
Triples 20
- SEC settles with Multiple Defendants in Market Manipulation Case
- SEC amends complaint as to Thirteen Remaining Defendants
- SEC filed an amended complaint in an ongoing civil action
- SEC alleges that numerous individuals and associated entities participated in microcap schemes
- microcap schemes generated over $27 million from unlawful stock sales
- Securities and Exchange Commission filed an amended complaint in an ongoing civil action alleging numerous individuals and entities participated in microcap schemes generating over $27 million from unlawful stock sales
- SEC settles with multiple defendants in a market manipulation case
- SEC amends complaint as to thirteen remaining defendants
- Barry Honig, et al. are defendants in a civil action for microcap market manipulation
- Securities and Exchange Commission filed amended complaint
- Securities and Exchange Commission settles with Multiple Defendants
- SEC alleges that individuals and associated entities participated in microcap schemes
- microcap schemes generated $27 million
- Securities and Exchange Commission filed complaint
- Barry Honig is a Defendant
- SEC settles with multiple defendants
- SEC amends complaint as to thirteen remaining defendants
- Securities and Exchange Commission filed amended complaint
- numerous individuals and associated entities participated in microcap schemes
- microcap schemes generated over $27 million
Text layers
Extracted body text (2,571c)
SEC Settles with Multiple Defendants in Market Manipulation Case and Amends Complaint as to Thirteen Remaining Defendants Litigation Release No. 24431 / March 22, 2019 Securities and Exchange Commission v. Barry Honig, et al., 18 Civ. 08175 (S.D.N.Y. filed September 7, 2018) On March 8, 2019, the Securities and Exchange Commission filed an amended complaint in an ongoing civil action in which the SEC alleges that numerous individuals and associated entities participated in microcap schemes that generated over $27 million from unlawful stock sales. The amended complaint includes additional allegations in support of its claims against thirteen of the original twenty defendants in a civil action. Since the filing of the initial action last September, the SEC has obtained final consent judgments as to six defendants who allegedly had a role in the schemes. On January 10, 2019, the SEC obtained final judgments against Miami-based billionaire investor Phillip Frost; OPKO Health, Inc., a publicly traded company for which Frost serves as Board Chairman and Chief Executive Officer; and Frost Gamma Investments Trust, a trust controlled by Frost. On February 6, 2019, the SEC obtained final consent judgements as to Miami-based investor Mark Groussman; Melechdavid Inc., a company of which Groussman is President; and Alpha Capital Anstalt, a Lichtenstein-based hedge fund. The SEC dismissed its charges against Southern Biotech, Inc., a now-defunct entity. According to the SEC's initial complaint, filed on September 7, 2018, the settling defendants failed to disclose that they were members of an investor group with respect to their investments in certain public companies, and in so doing, misled investors, and/or allegedly violated registration provisions of the federal securities in connection with their sales of securities in a penny stock issuer. Without admitting or denying the SEC's allegations, the settling defendants consented to the entry of final judgments permanently enjoining them from future violations of various provisions of the federal securities laws, and cumulatively paid more than $7.8 million in disgorgement of ill-gotten gains together with prejudgment interest thereon and civil penalties. In addition, defendants Frost, Frost Gamma, Groussman and Melechdavid each consented to penny stock bars, and defendants OPKO and Alpha each consented to certain undertakings related to their respective investment policies and procedures. For further information, see Litigation Release No. 24262, September 7, 2018. SEC Amended Complaint
OCR text (2,571c · html-text · 99% conf)
SEC Settles with Multiple Defendants in Market Manipulation Case and Amends Complaint as to Thirteen Remaining Defendants Litigation Release No. 24431 / March 22, 2019 Securities and Exchange Commission v. Barry Honig, et al., 18 Civ. 08175 (S.D.N.Y. filed September 7, 2018) On March 8, 2019, the Securities and Exchange Commission filed an amended complaint in an ongoing civil action in which the SEC alleges that numerous individuals and associated entities participated in microcap schemes that generated over $27 million from unlawful stock sales. The amended complaint includes additional allegations in support of its claims against thirteen of the original twenty defendants in a civil action. Since the filing of the initial action last September, the SEC has obtained final consent judgments as to six defendants who allegedly had a role in the schemes. On January 10, 2019, the SEC obtained final judgments against Miami-based billionaire investor Phillip Frost; OPKO Health, Inc., a publicly traded company for which Frost serves as Board Chairman and Chief Executive Officer; and Frost Gamma Investments Trust, a trust controlled by Frost. On February 6, 2019, the SEC obtained final consent judgements as to Miami-based investor Mark Groussman; Melechdavid Inc., a company of which Groussman is President; and Alpha Capital Anstalt, a Lichtenstein-based hedge fund. The SEC dismissed its charges against Southern Biotech, Inc., a now-defunct entity. According to the SEC's initial complaint, filed on September 7, 2018, the settling defendants failed to disclose that they were members of an investor group with respect to their investments in certain public companies, and in so doing, misled investors, and/or allegedly violated registration provisions of the federal securities in connection with their sales of securities in a penny stock issuer. Without admitting or denying the SEC's allegations, the settling defendants consented to the entry of final judgments permanently enjoining them from future violations of various provisions of the federal securities laws, and cumulatively paid more than $7.8 million in disgorgement of ill-gotten gains together with prejudgment interest thereon and civil penalties. In addition, defendants Frost, Frost Gamma, Groussman and Melechdavid each consented to penny stock bars, and defendants OPKO and Alpha each consented to certain undertakings related to their respective investment policies and procedures. For further information, see Litigation Release No. 24262, September 7, 2018. SEC Amended Complaint