SEC v. Stefan Benger; Handler, Thayer & Duggan, LLC; Stephan von Hase; and CTA Worldwide Services, SA, No. LR-21479, Northern District of Illinois (Apr. 7, 2010) — Press Release
raw: Stefan Benger, et al.
Stefan Benger, et al., No. 1:09-CV-676 (Apr. 7, 2010)
summary
Handler, Thayer & Duggan, LLC (HTD) was ordered to pay $238,359.63 in disgorgement, prejudgment interest, and civil penalties for acting as an unregistered broker in a massive international boiler room scheme.
paragraph
Handler, Thayer & Duggan, LLC (HTD), a Chicago law firm, was accused of participating in a massive international boiler room scheme by acting as an unregistered broker or dealer. The alleged scheme involved the sale of U.S. penny stocks to European investors, with over 60% of investment funds used to pay sales commissions, raising at least $44.2 million from 1,400 investors. HTD was ordered to pay $196,912.45 in disgorgement, $16,447.18 in prejudgment interest, and a $25,000 civil penalty.
narrative
Handler, Thayer & Duggan, LLC (HTD), a Chicago law firm, was accused of participating in a massive international boiler room scheme by acting as an unregistered broker or dealer. The alleged scheme involved the sale of U.S. penny stocks to European investors, with over 60% of investment funds used to pay sales commissions, raising at least $44.2 million from 1,400 investors. HTD was ordered to pay $196,912.45 in disgorgement, $16,447.18 in prejudgment interest, and a $25,000 civil penalty. The firm consented to the judgment without admitting or denying the allegations. The SEC's broader case targeted an international boiler room scheme that raised at least $44.2 million from 1,400 European investors, with over 60% of funds going to commissions. Stephan von Hase and CTA Worldwide Services, SA were also accused of orchestrating the scheme and violating Sections 17(a) and 10(b) of the securities laws. The judgment against HTD dismissed injunctive relief and a penny stock bar due to the firm's dissolution. The SEC obtained emergency relief on February 3, 2009, freezing assets and halting the scheme.
Classified boiler-room(confidence 100%). EDGAR detection: forms Form D· recall 50% / precision 4%. detection rule →
Statutes
Parties
Securities and Exchange CommissionStefan BengerHandler, Thayer & Duggan, LLCStephan von HaseCTA Worldwide Services, SA
Keywords
commissionstefan bengerpenny stocksecuritiesexchangehtdsecurities exchangeboiler roomschemeinvestorsactionvonhasectastefan
Extracted insights
Dollar amounts 5
- $44.20M $44.2 million $10M–$100M
- $16.70M $16.7 million $10M–$100M
- $197K $196,912 $100K–$1M
- $25K $25,000 $10K–$100K
- $16K $16,447 $10K–$100K
Entities 6
- company CTA Worldwide Services, SA
- person Joan H. Lefkow
- person philip t. powers
- agency Securities and Exchange Commission
- person Stefan Benger
- person Stephan Von Hase
Triples 2
- SEC entered a final judgment Handler, Thayer & Duggan, LLC (HTD)
- Handler, Thayer & Duggan, LLC (HTD) pay disgorgement in the amount of $19
Extracted body text (3,594c)
U.S. SECURITIES AND EXCHANGE COMMISSIONLitigation Release No. 21479 / April 7, 2010Securities and Exchange Commission v. Stefan Benger, et al., Civil Action No. 1:09-CV-676 (United States District Court for the Northern District of Illinois)The Commission announced that on April 1, 2010, the Honorable Joan H. Lefkow, U.S. District Court for the Northern District of Illinois, entered a final judgment by consent against Handler, Thayer & Duggan, LLC (HTD) in SEC v. Stefan H. Benger, et al., Civil Action No. 09-cv-00676 (N.D. Ill.). The judgment orders HTD to pay disgorgement in the amount of $196,912.45, representing profits gained as a result of the conduct alleged in the Complaint, together with prejudgment interest thereon in the amount of $16,447.18, and a civil penalty in the amount of $25,000. In addition, the judgment dismisses the Commission's claims for permanent injunctive relief and a penny stock bar against HTD in light of the fact that the firm is in the process of winding down its affairs and will be dissolved. HTD consented to entry of the final judgment without admitting or denying the allegations in the Commission's complaint.The Commission commenced this action on February 3, 2009, when it filed an ex parte, emergency action alleging that four Chicago residents and their entities worked in concert with boiler room sales agents based in Europe to orchestrate a massive international boiler room scheme. The allegedly fraudulent scheme involved the sale of shares of U.S. penny stock issuers to investors located throughout Europe. Critical to the scheme was the fact that defendants never informed investors that more than 60% of their investment funds were used to pay sales commissions. From March 2007 until the filing of the Commission action, the scheme allegedly raised at least $44.2 million from at least 1,400 investors. On February 3, U.S. District Judge Joan Lefkow granted all emergency relief requested by the Commission.The Commission alleged in its original complaint that HTD, a Chicago law firm, acted as an escrow agent through its employee, Philip T. Powers. The Commission charged HTD solely with effecting transactions in, or inducing or attempt to induce, the purchase or sale of securities, without registering with the Commission as a broker or dealer, in violation of Section 15(a) of the Securities Exchange Act of 1934 (Exchange Act).In addition, Judge Lefkow granted the Commission leave to file an amended complaint naming Stephan von Hase (von Hase) and his entity, CTA Worldwide Services, SA (CTA) as defendants. The Commission alleges that von Hase and CTA participated in the boiler room scheme described in the original complaint by acting in concert with the remaining defendants. The amended complaint alleges von Hase and CTA entered into agreements with penny stock issuers to solicit foreign investors in exchange for commissions that collectively exceed 60% of the investor proceeds. Von Hase and CTA allegedly retained foreign sales agents to solicit investors and, through escrow agents, received approximately $16.7 million from investors without informing them of the exorbitant fees. The Commission's amended complaint alleges that von Hase and CTA violated Section 17(a) of the Securities Act of 1933 (Securities Act), Sections 10(b) and 15(a) of the Exchange Act and Rule 10b-5 thereunder through their participation in the scheme and seeks an order of permanent injunction, disgorgement plus prejudgment interest, civil penalties and a penny stock bar.For further information, see LR-20881 (February 4, 2009).
OCR text (3,594c · html-text · 99% conf)
U.S. SECURITIES AND EXCHANGE COMMISSIONLitigation Release No. 21479 / April 7, 2010Securities and Exchange Commission v. Stefan Benger, et al., Civil Action No. 1:09-CV-676 (United States District Court for the Northern District of Illinois)The Commission announced that on April 1, 2010, the Honorable Joan H. Lefkow, U.S. District Court for the Northern District of Illinois, entered a final judgment by consent against Handler, Thayer & Duggan, LLC (HTD) in SEC v. Stefan H. Benger, et al., Civil Action No. 09-cv-00676 (N.D. Ill.). The judgment orders HTD to pay disgorgement in the amount of $196,912.45, representing profits gained as a result of the conduct alleged in the Complaint, together with prejudgment interest thereon in the amount of $16,447.18, and a civil penalty in the amount of $25,000. In addition, the judgment dismisses the Commission's claims for permanent injunctive relief and a penny stock bar against HTD in light of the fact that the firm is in the process of winding down its affairs and will be dissolved. HTD consented to entry of the final judgment without admitting or denying the allegations in the Commission's complaint.The Commission commenced this action on February 3, 2009, when it filed an ex parte, emergency action alleging that four Chicago residents and their entities worked in concert with boiler room sales agents based in Europe to orchestrate a massive international boiler room scheme. The allegedly fraudulent scheme involved the sale of shares of U.S. penny stock issuers to investors located throughout Europe. Critical to the scheme was the fact that defendants never informed investors that more than 60% of their investment funds were used to pay sales commissions. From March 2007 until the filing of the Commission action, the scheme allegedly raised at least $44.2 million from at least 1,400 investors. On February 3, U.S. District Judge Joan Lefkow granted all emergency relief requested by the Commission.The Commission alleged in its original complaint that HTD, a Chicago law firm, acted as an escrow agent through its employee, Philip T. Powers. The Commission charged HTD solely with effecting transactions in, or inducing or attempt to induce, the purchase or sale of securities, without registering with the Commission as a broker or dealer, in violation of Section 15(a) of the Securities Exchange Act of 1934 (Exchange Act).In addition, Judge Lefkow granted the Commission leave to file an amended complaint naming Stephan von Hase (von Hase) and his entity, CTA Worldwide Services, SA (CTA) as defendants. The Commission alleges that von Hase and CTA participated in the boiler room scheme described in the original complaint by acting in concert with the remaining defendants. The amended complaint alleges von Hase and CTA entered into agreements with penny stock issuers to solicit foreign investors in exchange for commissions that collectively exceed 60% of the investor proceeds. Von Hase and CTA allegedly retained foreign sales agents to solicit investors and, through escrow agents, received approximately $16.7 million from investors without informing them of the exorbitant fees. The Commission's amended complaint alleges that von Hase and CTA violated Section 17(a) of the Securities Act of 1933 (Securities Act), Sections 10(b) and 15(a) of the Exchange Act and Rule 10b-5 thereunder through their participation in the scheme and seeks an order of permanent injunction, disgorgement plus prejudgment interest, civil penalties and a penny stock bar.For further information, see LR-20881 (February 4, 2009).